Costs awarded against drug-test employee who doctored doctor’s report

The Fair Work Commission has ordered an employee to pay his employer more than $18,000 in costs after ‘doing a runner’ from his own unfair dismissal hearing when it emerged that he had manipulated a doctor’s report to hide a positive drug test.

The employee was dismissed from his job as a truck driver after a routine workplace drug and alcohol test showed positive results for amphetamine and methamphetamine.

The employee brought an unfair dismissal claim in the Fair Work Commission. Whilst giving evidence under oath, he stated that he went to his doctor immediately after the workplace drug test and submitted a urine sample which tested negative. The employee attached to his witness statement a copy of what he claimed was his doctor’s report showing the negative result.

The doctor who collected the urine sample was called to give evidence before the Commission.

The doctor told the Commission that the test results attached to the employee’s witness statement were not those which the doctor had provided, and that the original document (which he produced) in fact showed a positive result.

The employee left the courtroom during the doctor’s evidence and did not return. The proceedings were discontinued.

The employer subsequently applied for costs. The Commission found that the employee’s case was premised on fabricated evidence and a lie given under oath, and noted that:

“The lie was so central to the unfair dismissal remedy application that when it was uncovered as a lie during the proceedings, the case crumbled and the [employee], to use the colloquial, “did a runner” leaving his representative to clean up the mess and discontinue the proceeding.”

The Commission ordered that the employee pay the employer’s full costs (i.e. ‘indemnity costs’) of $18,618.31.

Mr James Green v Toll Holdings Ltd [2016] FWC 2790

Good Faith Obligations In Exercising Termination Rights

An employee has successfully argued on appeal that his employer had an obligation to act reasonably in relying upon a right to summarily terminate his employment. The NSW Court of Appeal upheld the bank executive’s wrongful termination claim although, the executive received only a small fraction of the $9m plus damages claimed. The NSWCA found that, despite the wrongful termination, the employer bank would likely have terminated for convenience, with notice, in any event and that damages should be assessed on that basis.

In 2012, the executive was one of a handful of recipients of an internal email about changes to his bank’s policies. A couple of weeks later, a journalist contacted the bank to say that he had been posted (in a handwritten envelope) a copy of the email, which turned out to have been doctored.

The bank investigated the leak and engaged a handwriting expert who concluded that it was “highly probable” that the writing on the envelope belonged to the executive. The executive denied that the writing was his or that he had sent the doctored email. He asked for a full copy of the expert’s report and an opportunity to provide his own report in response. The bank declined and terminated his employment without notice for serious misconduct.

The executive brought proceedings seeking over $9m in damages. At first instance, the Supreme Court rejected the claim, finding that the executive was responsible for posting the email to the journalist, and that summary dismissal was permitted on the basis that, in the bank’s opinion, serious misconduct had occurred.

On appeal, the NSWCA  reached different conclusions both about the extent to which the decision to dismiss could be reviewed, and about the merits of that decision. The NSWCA found that:

  • Even though the executive’s employment contract allowed summary termination if “in the opinion of [the bank]” he engaged in “serious misconduct“, the contract required that misconduct had objectively taken place, and that the bank act reasonably in reaching its opinion.
  • The bank had been unreasonable in limiting its investigation to the recipients of the email  and refusing to provide the expert’s report or allowing the executive to get advice on it;
  • The bank’s handwriting expert had “misapplied principles of fundamental importance” in reaching her conclusions; and
  • Accordingly, the bank was not entitled  to summarily terminate the executive’s employment.


However, the NSWCA’s wrongful termination finding did not lead to the damages claimed by the employee. It was accepted that, whilst  the bank had no grounds to dismiss for serious misconduct, it was entitled to terminate on notice “for any reason” and would likely have done so in any event. Accordingly, the executive’s damages were limited to the value of his notice period, plus interest, being approximately $110,000 (as opposed to the over $9m sought).

Obligation to act reasonably in arriving at an opinion about misconduct

Whilst an employer may have a right to terminate summarily, this decision suggests that an employer must read into that right an obligation to act reasonably. Acting reasonably in arriving at a view about whether misconduct has occurred may include, for example, following internal investigation procedures (even where those procedures are not contractual). Acting reasonably will also extend to a reasonable assessment of available evidence, including where relevant expert evidence.

Sobering effects of terminating for breach of alcohol policies

The Fair Work Commission has upheld an employee’s application for unfair dismissal following a positive blood alcohol test at work.

The employee, a maintenance worker, underwent a pre-work blood alcohol test.  His blood alcohol content first showed at 0.013%, and 0.006% some 30 minutes later.  The employee was stood down for the day, and his employment was terminated summarily 4 days later for breach of the company’s zero-tolerance Drug and Alcohol Policy.

Whilst the employee argued that his blood alcohol readings were low and still within legal limits to drive a B-double truck, Commissioner Bissett considered this as a rather dismissive attitude towards workplace health and safety on the part of the employee. The Commissioner also acknowledged that the incident was a clear breach of the Company’s zero-tolerance policy which required employees to present to work with 0.000% blood alcohol.

However, the employer relied upon other grounds to terminate, namely an earlier first and final warning for a safety breach, which the Commissioner found to have been inappropriate.  Also in issue was the fact that the employee did not appear to have been given an opportunity to respond to all of the matters being considered in respect of the decision to terminate, including the prior warning. Accordingly, where the first and final warning was found to have been harsh in the circumstances, and given the nature of the readings in question, the Commissioner found the dismissal to have been unfair.

The employee was not reinstated but was awarded compensation of $11,507.16.

The FWC has been increasingly willing to confirm the appropriateness of dismissals for breach of zero-tolerance work health and safety policies (see an earlier post on this topic at: Summary for breach of employer drug policy not unfair).

However, this decision suggests that, despite the existence of zero-tolerance drug and alcohol policies,  employers should still consider the appropriateness of dismissal for a “first offence”, particularly for otherwise lawful, low level breach.

Ingham v Metro Quarry Group Pty Ltd [2015] FWC 6472 (29 September 2015)

Excessive personal calls – What an employer can do when an employee just won’t hang up

A recent unfair dismissal decision contains key lessons for employers when managing employee use (and abuse) of work-related devices.  In this case the employer terminated the Applicant’s employment for failure to comply with a direction to repay a debt of $15,000 – being personal phone charges incurred on a work phone.

The Facts

The employer issued the Applicant with a work mobile phone. In late 2014, the employer detected that the Applicant’s use of the mobile phone was excessive and notified him that this was the case. The Applicant admitted that his excessive use was due to a number of personal international calls made to his family in India.  The Applicant apologised and offered to pay for the cost of the calls.  The total cost of the calls was $22,630 (incurred over a six month period from May to September 2014).  The Applicant repaid $7,500 towards the costs of the calls but refused to repay the remaining amount, claiming the amount was overly burdensome, and then claiming that he was not liable for the cost of the calls. 

The employer issued the Applicant with a warning letter in relation to his conduct, in which the employer:

  1. claimed the Applicant’s excessive personal calls on his work mobile phone breached its IT Equipment Policy and their Acceptable Use Guidelines (the Policies); and
  2. issued the Applicant with a direction to repay the outstanding monies owing. 

In response, the Applicant maintained his refusal to repay the outstanding phone bill and denied knowingly breaching the Policies.  For several months, the employer issued repeated directions to the Applicant to repay the monies, all of which where ignored.

Eventually in June 2015, the employer issued a ‘show cause’ letter to the Applicant, proposing a repayment plan which would see the Applicant repay $200 per fortnight until the outstanding monies were repaid.  The Applicant again failed to comply with the direction to accept a repayment plan and, as a consequence, the employer terminated the Applicant’s employment.

The Decision

Deputy President Gooley found that the Applicant was aware of, and breached, the IT Equipment Policy but was unable to make similar findings in respect of the Acceptable Use Guidelines (which outlined acceptable use of work-related equipment).  DP Gooley found it “surprising” that employees, including the Applicant, were not directed to the Guidelines during induction, at the commencement of employment.  Notwithstanding, DP Gooley found that the Applicant did breach the IT Equipment Policy, and that the employer was entitled to issue him with a warning in relation to his conduct. 

Importantly, the Applicant’s refusal to comply with the employer’s direction to enter into a repayment plan was a valid reason for termination.  In considering validity, DP Gooley noted that “I do not consider that the mere existence of a debt provides an employer with a valid reason to terminate the employment of an employee.  If there is a legitimate basis for the debt to be disputed then requiring the employee to repay the disputed amount on pain of dismissal may be unfair … however I find in this case that there was no reasonable basis for the Applicant to dispute the debt.  As such it was unreasonable of him not to enter into an agreement to repay the monies.” [60 to 61]

Tips for Employers

This decisions highlights that employers should:

  1. Ensure employees are aware of, and acknowledge, policies and procedures regarding the appropriate use of work related equipment, in particular IT and telephone equipment;
  2. Implement processes which provide for monitoring of such equipment and highlight the consequences associated with breach of such policies;
  3. When managing an employee debt, be flexible and reasonable when negotiating options for repayment, having regard to the quantum of the debt, the employee’s personal financial position and their remuneration; and
  4. Consider a direction to an employee to enter into a repayment plan, when managing employee debts become protracted and difficult.

Applicant v NBN Co Limited T/A NBN [2015] FWC 7412; Deputy President Gooley, 29 October 2015