PR940583 PR940583 Download Word Document AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION Workplace Relations Act 1996 s.170CE application for relief in respect of termination of employment Amanda James and Townsend Quality Flowers (U2003/718) COMMISSIONER LEWIN MELBOURNE, 18 NOVEMBER 2003 Termination of employment - re costs. DECISION [1] On 6 February 2003 Ms Amanda James (the applicant) made application to the Commission pursuant to section 170CE of the Workplace Relations Act 1996 for relief in respect of the termination of her employment by Townsend Quality Flowers (the respondent). [2] This decision concerns an application for an order for costs made by Townsend Quality Flowers, the respondent, in relation to that application. The application for an order as to costs is made pursuant to s.170CJ(2) of the Act which is as follows: "170CJ Commission may order payment of costs (2)If the Commission is satisfied that a party ( first party ) to a proceeding relating to an application under section 170CE has acted unreasonably in failing : (a) to discontinue the proceeding; or (b) to agree to terms of settlement that could lead to the discontinuance of the application; the Commission may, on an application under this section by the other party to the proceeding, make an order for costs against the first party."(emphasis added) [3] The original application was listed for arbitration on 7 and 8 July 2003 and 20 August 2003. At the conclusion of those hearings I directed the parties to file submissions in writing, the last of which was received on 1 September 2003. On 2 October 2003 I issued a decision [ PR938928 ] and order [ PR938929 ] in which I found that while there was valid reason for the termination of Ms James' employment the manner of that termination was lacking in procedural fairness. Accordingly, I found that the termination of Ms James' employment was harsh, unjust and unreasonable. However, on my assessment of the facts in relation to the criteria set out in s.170CH of the Act, I decided that it was not appropriate to award a remedy in Ms James favour. The central element of that decision was my determination that had Ms James been afforded procedural fairness in the manner of the termination of her employment it was unlikely that she would have remained employed by the respondent for more than two weeks beyond the date of the termination of her employment. The respondent had already paid to Ms James an amount equal to four weeks pay in lieu of notice at the time of the termination of her employment. [4] On October 16 2003 McPherson & Kelly, the solicitors for the respondent, filed the application for an order for the costs incurred by the respondent which is now before me. The respondent submits that the applicant acted unreasonably in failing to agree to terms of settlement that could have led to the discontinuance of the matter prior to arbitration. In the respondent's submission the applicant's decision to reject an offer of settlement made following a conciliation conference in their letter of 18 March was unreasonable and resulted in the respondent incurring significant legal costs. That offer was for the payment of $2500 in return for the discontinuance of the application. According to the applicant's submissions, which I accept, the applicant's wage rate at the time of the termination of her employment was $766.00 per week, not including superannuation. [5] The respondent submits that the offer of settlement made in the letter of 18 March was a reasonable offer based on an estimate of the duration of the applicant's likely further employment had the termination of her employment been effected in a manner which afforded her procedural fairness. [6] The applicant submits that in the context of the negotiations between the parties prior to the arbitration it was not unreasonable for her to decline the respondent's offer of 18 March. Following the expiry of the 18 March offer and prior to the arbitration the applicant, via her solicitors, made a counter offer to the respondent in which she offered to settle the matter in exchange for the payment of 8 weeks wages. The respondent did not reply to this counter offer. [7] The applicant further submits that as the facts regarding the termination of her employment were highly contentious and were disputed at all times prior to the arbitration it was not unreasonable for her to pursue the application. The applicant's submission is that her application was not without reasonable prospects of success and that the mere fact that it was ultimately unsuccessful does not mean that it was unreasonable for her to pursue it. In support of this submission the applicant points out that she was not confronted with any of the evidence led by the respondent which suggested that there was a valid reason for the termination of her employment until the time of the arbitration of the matter. The applicant finally submits that a party will not be taken to have acted unreasonably in rejecting proposed terms of settlement provided it was not unreasonable for that party to consider it may have had some prospect of success. In support of her submissions the applicant relies upon the decisions of Commissioner Whelan in Biviano v. Suji Kim Collection 1 , Commissioner Larkin in Jones v. Britax Rainsford 2 and Deputy President Ives in Dimovski v. Howe & Co Pty Ltd 3 . [8] In my view, the submissions of the applicant are well founded, had her version and interpretation of the facts or even a substantial part of it been accepted it is possible that a remedy would have been awarded. Importantly, to the extent that access to a remedy is dependent on an applicant successfully making out a case that the relevant termination of employment was harsh, unjust or unreasonable the applicant clearly had prospects of success and did not act unreasonably in seeking such a finding. [9] Moreover, my decision of 2 October in this matter devolved very much to an exercise of discretion. In my view, where the ultimate determination of whether or not a remedy should be awarded where a termination has been found to be harsh, unjust or unreasonable requires a finely balanced act of discretion it would be inappropriate to award costs where genuine attempts at settlement had been made. In my decision of 2 October I said: Having regard to all of the above I consider the exercise of the discretion to award a remedy in the form of an amount in lieu of reinstatement is very finely balanced. In the particular circumstances of this case I am not persuaded to do so 4 . [10] Accordingly I decline to order costs as sought by the respondent. Printed by authority of the Commonwealth Government Printer <Price code B> 1 PR919431 2 PR914076 3 PR937258 4 PR938928 paragraph 22