Industrial Relations Secretary v Wattie

On 13 May 2016 the employment of Jason Wattie (the defendant) was terminated for misconduct pursuant to s 69 of the Government Sector Employment Act 2013 (NSW) (the GSE Act). There is no challenge to the validity of the termination. The defendant commenced unfair dismissal proceedings pursuant to s 84 of the Industrial Relations Act 1996 (NSW) (the IR Act) in the Industrial Relations Commission of New South Wales (IRC). On 11 October 2016 Commissioner Murphy (the Commissioner) determined that the termination was harsh, though neither unjust nor unreasonable, and ordered that the defendant be reinstated without back pay: Wattie v Industrial Relations Secretary on behalf of the Secretary of the Department of Justice (CSNSW) [2016] NSWIRComm 1036.

The defendant’s nominal employer, the Industrial Relations Secretary on behalf of the Secretary of the Department of Justice (the plaintiff), sought leave from the Full Bench of the IRC to appeal against the reinstatement order. The Full Bench refused leave on 28 February 2017.

By summons filed on 17 May 2017 the plaintiff claims relief in respect of the Commissioner’s decision to reinstate the defendant’s employment; and the Full Bench’s decision to refuse leave to appeal. An extension of time is required to challenge the Commissioner’s decision. For reasons given below I am persuaded that it is appropriate to extend time.

By reason of s 179(1) of the IR Act, this Court’s jurisdiction under s 69 of the Supreme Court Act 1970 (NSW) is limited to cases where jurisdictional error in a decision of the IRC has been established: Kirk v Industrial Relations Court of NSW (2010) 239 CLR 531; [2010] HCA 1 at [55] (French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ).

The sole ground on which jurisdictional error is alleged is that the Commissioner was obliged, and failed, to take into account the statutory framework and instruments germane to the defendant’s employment in his determination that the defendant’s dismissal was, though neither unreasonable nor unjust, harsh.

Because of the limited nature of this Court’s jurisdiction, the facts relevant to the determination of this issue can be summarised briefly.

The defendant had been employed within Corrective Services NSW (CSNSW) as a correctional officer since 1994. He had not been the subject of disciplinary investigation or action prior to the matters resulting in his dismissal. He was dismissed as a result of three assaults he committed against three inmates on 13 September 2014, 19 December 2014 and 29 December 2014.

On 7 August 2015 the defendant pleaded guilty to two counts of common assault and one count of assault occasioning actual bodily harm arising from the three incidents referred to above. The Local Court did not record a conviction on the common assault charges, but required the defendant to enter into good behaviour bonds for 12 months pursuant to s 10(1)(b) of the Crimes (Sentencing Procedure) Act 1999 (NSW) (s 10 bonds). In respect of the assault occasioning actual bodily harm, the defendant was convicted and required to enter into a good behaviour bond for 12 months pursuant to s 9 of the Crimes (Sentencing Procedure) Act. The defendant appealed to the District Court against the sentence imposed for the assault occasioning actual bodily harm. Garling ADCJ quashed the conviction for that offence and found the offence proven without proceeding to a conviction. He imposed a s 10 bond to be of good behaviour.

After the criminal proceedings were finalised, the plaintiff began disciplinary action against the defendant, who was invited to respond to the allegations of misconduct based on the three assaults. The allegations were contained in a letter to the defendant dated 11 September 2015, the following part of which was ultimately reproduced in the Commissioner’s reasons at [47] (see below):

At the conclusion of the disciplinary processes (which included oral and written representations from the defendant), the defendant was informed by letter to his solicitors dated 5 May 2016 that, on the basis of the following misconduct, his employment would be terminated if he did not tender his resignation within 7 days:

Assistant Commissioner Wilson (who made the decision to dismiss the defendant) gave the following reasons for his decision (which the IRC reproduced in [57] of its reasons (see below)):

The defendant did not tender his resignation, as a consequence of which he was informed by letter dated 13 May 2016 that his employment was terminated.

The proceedings in the IRC took place on 29 and 30 August 2016. As there is an issue about whether the plaintiff sufficiently raised the matter which he now contends to be a mandatory relevant consideration it is necessary to examine what was put by the plaintiff to the Commissioner. Ms Graycar, who appeared for the plaintiff in the IRC, relied on oral and written submissions. In the written submissions made on behalf of the plaintiff, it was submitted:

In oral submissions, Ms Graycar said:

Ms Graycar referred to the governing legislative scheme and confirmed that the defendant was dismissed for misconduct, as opposed to having been convicted of a criminal offence, since the legislation at that time required a conviction. She referred to a subsequent amendment (which came into force on 1 July 2016, which was after the relevant time) which provided for a finding of guilt (rather than a conviction) as being a basis for dismissal. She also referred to the “broader principles” referred to in ss 6 and 7 of the GSE Act and the relevant provisions of the Crimes (Sentencing Procedure) Act, ss 9 and 10. When referring to salient authorities, Ms Graycar said:

Ms Graycar submitted:

On 11 October 2016 the Commissioner, after having given reasons for his decision, made the following orders:

Under the heading “Disciplinary proceedings”, the Commissioner included, at [47] of his reasons, the extract from the letter dated 11 September 2015 set out above. At [57] of the reasons, the Commissioner extracted the reasons given for the decision to terminate the defendant’s employment which are set out above (from the letter of 5 May 2016).

The Commissioner said, at [78]:

The Commissioner also made the following findings:

The Commissioner said at [101]:

The plaintiff sought to appeal to the Full Bench of the IRC pursuant to s 187 of the IR Act. Appeals to the Full Bench require the grant of leave: s 188 of the IR Act. The nature of the appeal was specified in s 191 of the IR Act, which provided:

By application for leave to appeal filed in the IRC on 28 October 2016 the plaintiff identified the questions raised by the appeal as including the following:

The plaintiff identified reasons why leave should be granted, which included the following:

The plaintiff included in the proposed grounds of appeal (if leave were granted):

In written submissions provided to the Full Bench, the plaintiff submitted that the Commissioner had “failed in his reasons to indicate that he had given any consideration to such matters as the following”. The matters referred to included: Part 2 of the GSE Act; cl 24 of the Crown Employees (Correctional Officers, Department of Attorney General and Justice – Corrective Services) Award 2012, which deals with professional conduct (the award); the requirements of the CSNSW Operations Procedures Manual, including Section 13.7, “Using Force on Inmates Policy”; the express obligation on correctional officers to report in writing the use of force on inmates “no matter how minor”; and cl 131 of the Crimes (Administration of Sentences) Regulation 2014, which prohibits the use of force that is more than is reasonably necessary.

The plaintiff relied in written submissions to the Full Bench on what was said in Public Service Association and Professional Officers’ Association Amalgamated Union of New South Wales v Secretary of the Treasury [2014] NSWCA 112; (2014) 242 IR 318 (the PSA Case) at [59] (Basten JA, Ward JA and Bergin CJ in Eq agreeing) to support the submission that the Commissioner ought be taken to have failed to address the regulatory context because it was not apparent from his reasons that he had done so:

In the hearing before the Full Bench of the Commission, Mr Benson, who appeared for the plaintiff, emphasised that the Commissioner could not perform the task he was required to perform without assessing the seriousness of the defendant’s misconduct in the regulatory context.

For the reasons given above, I am satisfied that the plaintiff sufficiently raised before the Commissioner and the Full Bench the matters presently relied upon.

It was not disputed that it would have been within the power of the Full Bench of the IRC to grant leave to the plaintiff to appeal against the Commissioner’s decision.

On 28 February 2017 the Full Bench of the IRC refused leave to the plaintiff to appeal against the Commissioner’s decision: Industrial Relations Secretary v Wattie [2017] NSWIRComm 1007. In its reasons the Full Bench said, of present relevance:

The first question is whether, in order for this Court to have jurisdiction to grant relief, the plaintiff must establish jurisdictional error in the Full Bench’s decision to refuse leave or whether it is sufficient for the plaintiff to establish that the Commissioner made a jurisdictional error in making his decision.

The starting point is that, where a party seeks to challenge a decision, it must challenge the operative decision. Thus, if a party has appealed against a decision, generally, the party will not be permitted to seek relief in the nature of prerogative relief against the original decision, since it is the decision on appeal that is operative: The Queen v Marks; ex parte Australian Building Construction Employees Builders’ Labourers’ Federation (1981) 147 CLR 471 at 476; [1981] HCA 33. In Kirk v Industrial Relations Court of NSW, the High Court quashed the decision of the Industrial Court and the decision of the Full Bench dismissing the appeal from the Industrial Court. I do not discern any inconsistency between the matters raised by the plaintiff in the Full Bench and the matters raised in this Court; see the consideration of relevant authorities in Navazi v New South Wales Land and Housing Corporation [2015] NSWCA 308 at [82]-[120] (Sackville AJA, Leeming JA and Adamson J agreeing). One of the bases for the application for leave was that the Commissioner had committed jurisdictional error.

The present case is to be distinguished from the PSA Case in which the Full Bench identified error in the Commissioner’s decision but itself committed jurisdictional error by failing to undertake the “essential task” of identifying the element of misconduct, assess its seriousness and weigh that against the consequences of the proposed dismissal: [71] (Basten JA). The Court in that case held at [72]:

The present case is also, in my view, to be distinguished from Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union v Abigroup Contractors Pty Ltd [2013] FCAFC 148 (CEPU v Abigroup). In that case, unlike in the present, the Full Bench of the Fair Work Commission had granted leave to appeal but dismissed the appeal. The Full Federal Court, by majority (Katzmann and Rangiah JJ) said at [176] that it would refuse relief against the decision at first instance unless it concluded that the decision of the Full Bench of the Fair Work Commission involved jurisdictional error since “it would be futile to grant relief in respect of a decision at first instance when the appellate decision stands and is conclusive and operative”. As their Honours were satisfied that the Full Bench of the Fair Work Commission had committed jurisdictional error, the decision of the Full Bench was set aside, as were aspects of the first instance decision.

In Coal & Allied v Australian Industrial Relations Commission (2000) 203 CLR 194; [2000] HCA 47 (a decision on which the defendant also relied), it was not argued that the decision at first instance (by Boulton J) was void for jurisdictional error. Accordingly, the question whether the Full Federal Court was correct to set aside the decision of the Full Bench of the Commission depended on the establishment of jurisdictional error at the level of the Full Bench of the commission. As the finding of error by the Full Bench was within its jurisdiction, the decision of the Full Bench could not be set aside and the appeal against the decision of the Full Federal Court was allowed.

The effect of The Queen v Marks and CEPU v Abigroup was considered, again in the federal context, in Daffallah v Fair Work Commission (2014) 225 FCR 559; [2014] FCA 328. Mortimer J said at [56]:

Having regard to the nature of the error alleged in the present case, I am satisfied that, if the plaintiff establishes jurisdictional error in the Commissioner’s decision, he will also have made out jurisdictional error in the Full Bench’s refusal of leave. In other words, I consider that the Full Bench would have had no jurisdiction to refuse leave to appeal if jurisdictional error in the Commissioner’s decision of the nature alleged was established in the present case. If jurisdictional error is established, both decisions must be set aside and the matter remitted to a single IRC Commissioner to be determined according to law.

Accordingly, the question is whether the plaintiff has established jurisdictional error in the Commissioner’s decision. Before turning to the characterisation of any error as one going to jurisdiction, it is necessary to determine whether the plaintiff has established an error of law. The failure to take into account a mandatory relevant consideration is an error of law: Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39-40 (Mason J); [1986] HCA 40. There is no suggestion that there was any express statutory requirement that the Commissioner consider the relevant statutory context before deciding whether the defendant’s dismissal was harsh, unjust or unreasonable. If there was any such requirement, it must arise by necessary implication having regard to the regulatory and policy context: Minister for Aboriginal Affairs v Peko-Wallsend Ltd at 40. This requires consideration of the applicable legislation, including subordinate legislation, and policy documents.

Section 84 of the IR Act relevantly provided:

Section 88 of the IR Act provided:

Section 89 of the IR Act provided in part:

Part 2 of the GSE Act relevantly provided:

Section 7, in Part 2, lists certain “Government sector core values”, which include: (under the heading “Integrity”) “(d) Place the public interest over personal interest”; (under the heading “Trust”) “(c) Uphold the law, institutions of government . . .”

Section 8, which is also in Part 2, provided:

Section 69 of the GSE Act relevantly provided:

Clause 131 of the Crimes (Administration of Sentences) Regulation 2014 (NSW) relevantly provided (at the time of the assaults committed by the defendant on inmates):

Clause 251 of the Crimes (Administration of Sentences) Regulation provided:

The Operations Procedures Manual for CSNSW contained, in Section 13.7, procedures for “Using Force on Inmates”. It referred expressly to cl 131 of the Crimes (Administration of Sentences) Regulation. It relevantly provided as follows:

Clause 24 of the award required officers to “perform their duties diligently, impartially and conscientiously to the best of their ability by complying with the CSNSW Code of Conduct in the performance of their duties” and to “be professional in their conduct with the public, other staff and inmates”. The values expressed in the Guide to Conduct and Ethics, 2010 edition, (which was accepted to be the relevant Code of Conduct referred to in the award) included “safety, welfare and positive development of offenders” and “secure and humane management of offenders”. Clause 2.8 of the Code of Conduct, entitled “Professional Conduct Towards Offenders”, said:

As referred to above, s 88 of the IR Act provides that certain matters “may” be taken into account by the IRC. On the face of it, none of these matters constitute mandatory relevant considerations by reason of the word “may”. However, this is not the end of the inquiry since the obligation to take certain matters into account may arise by necessary implication: Minister for Aboriginal Affairs v Peko-Wallsend Ltd at 40.

The relevant assessment required to be made by the IRC was whether the dismissal was “harsh, unreasonable or unjust”. There is no challenge to the finding that the dismissal was neither unreasonable nor unjust. The challenge was to the determination that it was “harsh”.

In Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 465; [1995] HCA 24 McHugh and Gummow JJ (in a minority judgment) said:

This passage was followed and applied by the Court of Appeal in the PSA Case, where Basten JA said at [70] that it was necessary to consider separately the possibility that the dismissal might be harsh although not unjust or unreasonable. In the PSA Case the Court of Appeal held that the Full Bench had committed jurisdictional error by failing to undertake the “essential task” of identifying the relevant misconduct, assessing its seriousness and weighing that against the consequences of the proposed dismissal. Basten JA explained the error (and why it was jurisdictional) in the following passages:

As can be seen from the passages set out above from the PSA Case, the Full Bench was found to have committed a jurisdictional error by failing to identify the misconduct, assess its seriousness and weigh it against the consequences of the proposed dismissal for the employee. In my view, the error made by the Commissioner in the present case was of the same character as the one found to have been made by the Full Bench of the IRC in the PSA Case.

While there may be other occupations to which the regulatory context is largely irrelevant, the same cannot be said for the employment of correctional officers. The State is responsible for every inmate, having either, through its enforcement arm (the police force), arrested and taken an accused person into custody, or through its judicial arm, imposed a sentence, or refused bail. Correctional officers are centrally engaged in the obligations of the State to safeguard all persons who are in custody, either on remand following refusal of bail, or not having applied for bail, awaiting a criminal hearing, or who are serving a custodial sentence imposed by a court. When a correctional officer assaults a prisoner, he or she is doing so in the exercise of the actual or ostensible authority conferred by the State on correctional officers who are its agents, even where, as here, the assault falls outside the warranty of authority because it is in breach of the Using Force on Inmates policy.

Clause 131 of the Crimes (Administration of Sentences) Regulation is plainly intended to ensure that correctional officers do not use force against inmates except in certain defined circumstances. Section 13.7 of the CSNSW Operations Procedures Manual, Using Force on Inmates Policy, is designed to implement cl 131. As a consequence of the relationship between the State and those it detains in custody, the State owes a duty to exercise reasonable care for the safety of inmates during the period of their detention: Howard v Jarvis (1958) 98 CLR 177 at 183; [1958] HCA 19. Where a prison officer has been found guilty of assault under the general law and has thereby breached cl 24 of the award and the Code of Conduct incorporated in it, and cl 131 of the Crimes (Administration of Sentences) Regulation (and the associated policy), the State may, by exposing inmates to the defendant (by permitting him to remain employed as a correctional officer), be putting itself in breach of that duty.

The importance of cl 131 of the Crimes (Administration of Sentences) Regulation and the Using Force on Inmates Policy ought to have been apparent to the Commissioner. Clause 131 was included in the tender of a slim bundle of regulatory material. The Using Force on Inmates policy was separately tendered and was specifically referred to in the correspondence between the plaintiff and the defendant that was in evidence, including the letter of 11 September 2015 from the Assistant Commissioner to the defendant in which detailed allegations of misconduct were set out. This letter was extracted in the IRC Commissioner’s reasons at [47]. As referred to above, I reject the defendant’s submission that the regulatory context was not sufficiently raised by the plaintiff in the IRC.

Having regard to the central relevance of the regulatory context to the question whether the dismissal was harsh, it was, in my view, a condition of the valid exercise of the Commissioner’s power that he consider that context. Although that requirement was not explicitly stated in the IR Act, it was central to the Commissioner’s task of deciding whether dismissal was relevantly harsh and, if so, what remedy would be appropriate. Any purported exercise by the Commissioner of the powers under s 89 of the IR Act in which he did not have regard to the regulatory context could not, in my view, be a bona fide attempt to exercise the power. In the present case, I am persuaded that the task of assessing the seriousness of the misconduct (which formed part of the “essential task” which the Commissioner was obliged to undertake in deciding whether the dismissal was unjust) required the regulatory context to be taken into account since it was only within that context that the seriousness of the defendant’s misconduct as a correctional officer could be assessed.

As I am satisfied that the Commissioner was obliged to take into account the relevant regulatory context, it is necessary to consider whether he actually did. The weight to be given to mandatory relevant considerations is a matter for the decision-maker, in this case, the Commissioner: Carr v Western Australia (2007) 232 CLR 138; [2007] HCA 47 at [5]-[7] (Gleeson CJ). However, where a decision-maker has failed to give any consideration to such a matter, the decision has not been made in accordance with law.

Mr Gibian, who appeared on behalf of the defendant, submitted that, in so far as the regulatory context was raised in the IRC, it was considered by the Commissioner. He argued that the Commissioner addressed the regulatory context by:

Although the Commissioner was not required to address in terms each of the statutory provisions or policy material relevant to the obligations of correctional officers towards inmates which are referred to above, he was required to consider the substance of these matters and demonstrate by his reasons that he had done so. In the context of the present case, he was obliged, when assessing the seriousness of the misconduct, at least to address the express prohibitions on the use of force against inmates (except in specified circumstances which are not said to be relevant here) and the mandatory obligations to report such use of force, however minor. I note that these prohibitions were expressed, not only in cl 131 of the Crimes (Administration of Sentences) Regulation but also in the Using Force on Inmates policy to which several references were made in the letter of 11 September 2015 referred to above. It is not necessary, in these circumstances, to consider whether s 8(3) of the GSE Act deprives the failure to take into account any of the “core values” of legal consequence in a case such as the present.

In his reasons, the Commissioner reproduced extracts from the correspondence in which the plaintiff set out the allegations made against the defendant (which contained references to the regulatory context and the Using Force on Inmates policy) and the plaintiff’s reasons for dismissing the defendant. However, the Commissioner’s reasons do not reveal that he addressed the regulatory context. Consideration of the substance of the regulatory context required consideration of the circumstance that use of force by a correctional officer against an inmate, which amounted to criminal assault on not one but three separate occasions, was antithetical to that context and to the integrity of the criminal justice system. It constituted an abuse of the power of the State by the defendant who, as one of its correctional officers, was acting as its agent. I do not regard the Commissioner’s general observation in [78] that assaults on inmates in correctional centres by correctional officers cannot be condoned or tolerated as sufficient to indicate that he gave any consideration to the regulatory context. Indeed, one could substitute almost any job title for “correctional officers” (including bouncers) and any workplace for “correctional centres” (including licensed premises) and any class of victims for “inmates” (including clients) and the sentence would remain true. The reference to the “relevant CSNSW policies” in [101] was insufficient to demonstrate that they had been taken into account.

There was no complaint about the reasons of the Commissioner per se. The complaint was about the substance of the Commissioner’s reasoning process in finding that the dismissal was harsh and that the defendant ought be reinstated. In my view, the Commissioner’s reasons warrant an inference that he failed to take into account the regulatory context since the scant reference to such matters is almost exclusively confined to quotations from the plaintiff’s correspondence. The passages in [78] and [101] are too general for an inference to be drawn that the regulatory context was actually considered by the Commissioner.

A failure to take into account a mandatory relevant consideration is an error of law. If it is also a jurisdictional error, then this Court has jurisdiction to intervene. If it is an error within jurisdiction, then this Court’s jurisdiction is excluded by s 179(1) of the IR Act. While the High Court in Kirk v Industrial Court has cautioned against using the statements in Craig v South Australia (1995) 184 CLR 163 at 179 as “providing a rigid taxonomy of jurisdictional error” ([73]), the oft-cited passage is useful as a list of examples of jurisdictional errors. The High Court (Brennan, Deane, Toohey, Gaudron and McHugh JJ) said in Craig v South Australia at 179:

It was argued on behalf of the defendant that substantial restraint should be exercised by courts in finding jurisdictional error in this area. Mr Gibian referred to what Buchanan J (Allsop CJ and Siopis J agreeing) said in Toms v Harbour City Ferries Pty Ltd (2015) 229 FCR 537; [2015] FCAFC 35 (which concerned a challenge in the Federal Court to a decision of the Fair Work Commission on the grounds of jurisdictional error) at [42]:

At [59], Buchanan J described the task of the court in this context:

There are significant differences between the federal and New South Wales regimes for unfair dismissal claims. For example, s 387 of the Fair Work Act 2009 (Cth) lists the matters which the Fair Work Commission must take into account, thereby making them mandatory relevant considerations. Despite these differences, I accept that these statements from Toms v Harbour City Ferries Pty Ltd are applicable to the determination whether there has been jurisdictional error by the Commission and the Full Bench.

In the present case, the Commissioner ignored relevant material (the regulatory context) and reached a conclusion which was erroneous because it lacked an essential integer: an assessment of the seriousness of the misconduct which required consideration of the regulatory context. I am satisfied that this amounted to a jurisdictional error since it centrally affected the task which the Commissioner was required to undertake in determining the defendant’s application under s 84 of the IR Act. In these circumstances the Commissioner’s decision ought not be seen as a true exercise of the power to determine whether the dismissal was, relevantly, harsh, and, if so, what relief ought be granted. I have arrived at my conclusion by the application of the principles to which I have referred. However, it is also significant that jurisdictional error was found by the Court of Appeal in the PSA Case, in circumstances which do not appear to me to be materially different from the present case.

For the reasons given above, the plaintiff has made good the challenge to the Commissioner’s decision and to the decision of the Full Bench to refuse leave to appeal. Both decisions must be set aside. Because the Commissioner’s decision was vitiated by jurisdictional error, it is appropriate for the matter to be remitted to the Commission to be determined in accordance with law by a single Commissioner.

The plaintiff commenced the proceedings on 17 May 2017, which was more than three months after the decision of the Commissioner. Accordingly, the plaintiff needs an extension of time under the Uniform Civil Procedure Rules (UCPR), r 59.10. The plaintiff explained the reasons for seeking leave to appeal to the Full Bench against the Commissioner’s decision rather than challenging it in this Court pursuant to s 69 of the Supreme Court Act. The consequence of this course was that the plaintiff was out of time for challenging the Commissioner’s decision by the time the decision of the Full Bench was made. In my view it was reasonable for the plaintiff to seek to challenge the Commissioner’s decision by applying for leave to appeal to the Full Bench since it was open to the Full Bench to correct the Commissioner’s jurisdictional error. That course forestalled the argument that prerogative relief ought be refused in this Court on grounds that the plaintiff had not exhausted other avenues of relief. No prejudice has been shown. I am satisfied that it is appropriate to grant an extension of time for the filing of the summons.

I have not heard the parties on costs. Ordinarily costs would follow the event: UCPR, r 42.1. I will make that order, subject to the parties’ right to make a different application to my Associate within seven days.

For the reasons set out above, I make the following orders: