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Arbitration Tribunal of Fiji |
THE REPUBLIC OF THE FIJI ISLANDS
NO. 33 OF 2004
AWARD OF
THE ARBITRATION TRIBUNAL
IN THE DISPUTE BETWEEN
FIJI BANKS AND FINANCE SECTOR EMPLOYEES UNION
AND
COLONIAL NATIONAL BANK
FBFSEU: Mr R P Singh
Colonial: Mr H Nagin
DECISION
This is a dispute between the Fiji Banks and Finance Sector Employees Union (the "Union") and Colonial National Bank (the "company") concerning the dismissal of Mr Sunil Dutt (the "Grievor").
A trade dispute was reported by the Union on 18 September 2002. The Report was accepted by the Permanent Secretary on 18 October 2002. The Dispute was subsequently referred to a Disputes Committee. As a consensus decision could not be reached the Minister authorized the Permanent Secretary to refer the dispute to an Arbitration Tribunal for settlement pursuant to section 5A(5) (a) of the Trade Disputes Act Cap 97.
The Dispute was referred to the Permanent Arbitrator on 9 December 2002 with the following terms of reference:
"...... for settlement over the dismissal of Mr Sunil Dutt which the Union claims is harsh, unreasonable, unjust and unfair and seeks his re-instatement without loss of benefits".
The Dispute was listed for a preliminary hearing on 20 February 2003. As there was no appearance for the Company, it was relisted for a preliminary hearing on 27 February 2003. On that day the parties were directed to file preliminary submissions by the end of May and the hearing of the dispute was set down for 5 June 2003.
On 5 June 2003 the parties requested a brief adjournment for further discussions on possible settlement of the Dispute. The Tribunal agreed to the adjournment and the Dispute was listed for mention the following day. Between 6 June 2003 and 20 January 2004 the Dispute was listed for mention on seven occasions.
On 20 January the Dispute was listed for hearing on 29 March 2004. Again, at the request of the parties the hearing date was vacated. The Dispute was eventually heard on 4 June 2004.
The Company had filed its preliminary submissions on 28 May 2003 and the Union did so on 30 May 2003.
At the hearing the Company called two witnesses, Mr K Sokosoko and Mr A Kumar. The Union called the grievor Mr Dutt to five evidence.
At the conclusion of the evidence the parties requested and were granted leave to file final written submissions. The last of these was filed in the Tribunal on 20 August 2004.
Mr Sunil Dutt (the grievor) commenced employment with the Company on or about 24 August 2000 as a teller at the Company’s Savusavu Branch.
As a result of allegations relating to non-compliance with the Company’s Policy and Procedures between August 2001 and May 2002 the Grievor was initially suspended on 5 June and then summarily dismissed with effect from 7 June by letter dated 10 June 2002. Omitting formal and irrelevant parts, this letter stated:
"We refer to the Special Investigation conducted on the 5th and 6th of June 2002 and Investigation Report submitted by the Manager Security and Investigations dated 7 June 2002 regarding your involvement in aiding ex-staff Jone Saravaki (earlier dismissed for fraudulent conversion) by paying out forged cash withdrawals from your cash till on a number of customer’s passbook accounts totaling $5,615 at the CNB Savusavu Branch. We refer particularly to an interview held on Wednesday 5 June at the Branch with Manager Secretary and Investigations, Anirudh Kumar and Area Manager Northern and Western Branches, Kamini Mani wherein you had admitted serious breaches of Banking policy/procedures which resulted in several forged bank withdrawals for encashment.
Consequently you are hereby advised that you are Summarily Dismissed from Colonial’s employ with effect from the close of business Friday 7 June 2002 in accordance with Clause 4B (ii) (a) and (b) of the Collective Agreement. In arriving at this decision Management is fully convinced that you have deliberately failed in this instance to adhere to proper Banking Policy and Procedures, more so the trust placed in you by the Bank management.
.............. all leave owing to you shall be forfeited and directed towards recovery of the loss........"
Clause 4B(ii) of the Collective Agreement provides:
"Nothing contained in sub-clause (i) above shall be construed as in any way detracting from National Bank’s right to dismiss summarily any employee within the regulations agreed to upon the commencement of his or her employment and in the following circumstances:
(a) Where an employee is guilty of misconduct inconsistent with the fulfillment of the express or implied conditions of his or her contract of service;
(b) For willful disobedience to lawful orders given by National Bank or its authorized representative;"
It should be noted that these two grounds which were referred to in the dismissal letter are in terms consistent with grounds under which summary dismissal is permitted pursuant to section 28 of the Employment Act Capt.92.
The obligation on the part of the Grievor to follow and comply with the Bank’s Policy and Procedures is set out in a number of documents including the "Officer’s Declaration" signed by the Grievor on 24 August 2000, the Grievor’s letter of appointment dated 24 August 2000, the Bank’s Code of Conduct and Colonial’s Business Principles and Code of Conduct.
In this Dispute the relevant banking procedures were set out in the Savings Bank Procedure Manual, the Cash and Telling Manual, Internal Memorandum dated 9 November 2001 on Payments (savings, withdrawals and encashment of cheques) and Internal Memorandum dated 14 December 2002 on withdrawal without Passbook.
The Tribunal is satisfied that the Grievor knew or right to have known the procedures which were set out and prescribed in those documents.
The allegations which formed the Company’s justification for summary dismissal are set out in an Internal Memorandum dated 7 June 2002. The allegation is that on a number of occasions the Grievor gave cash from his till to Jone Saravaki (then also a bank employee) without receiving any vouchers. Later in the day Jone would hand over to the Grievor forged vouchers (withdrawal slips purported to be signed by customers). The Grievor would then balance his till by debiting those customer’s accounts on the Bank’s system. These withdrawals were effected without the customer’s passbook and without the requisite manager’s approval. Further the Grievor had in effect handed over cash to a third party and/or Jone Saravaki without any proper identification of the customer nor verification of the customer’s signature.
The dismissal letter refers to interviews which were conducted by Bank Officers with the Grievor on 5 and 6 June 2002. The principal interview was conducted on 5 June commencing at 11 am and finishing at 1.15pm. During the course of the interview the allegations concerning giving cash to Jone Saravaki from the till, receiving withdrawal slips from Jone later in the day, debiting customers accounts without passbooks and failing to verify signatures were put to the Grievor. The Grievor admitted the allegations. The brief interview the following day related to allegations concerning personal gain which were denied and which did not form the basis of the decision to dismiss summarily.
Following the interview conducted on 5 June 2002, the Grievor received a letter of suspension late on the same day.
In response to that letter, the Grievor wrote a letter dated 5 June 2002 to the Company’s People Relations Manager. The second paragraph of that letter states:
"Since Jone Saravaki was a Senior Staff and we had trust in him. I accept I did pass the withdrawals, but I did not ever had any idea or contribution towards his fraudulent activity"
In response to the dismissal letter the Grievor wrote a letter which appears to be undated but was received by the Company on 11 June 2002. In the second paragraph the Grievor states:
"As you have mentioned the bank procedures and policy which has resulted in my dismissal, I wish to let you know that it was not only me going against the procedures but some of your senior staff have also aided Jone Saravaki in cashing forged bank withdrawals".
In the same letter the Grievor outlines allegations against other staff at the Savusavu Branch. He also claims that similar practices had been authorized by local senior staff at the Branch.
The dismissed employee Jone Saravaki wrote a letter dated 30 July 2002 addressed to the General Manager of the Company. In that letter the following extract appeared in the second paragraph:
"I would also like to let you know that no other staff was involved with me, especially Sunil who has been dismissed because of me. Sunil was not aware of my fraudulent activities and he has been also dismissed. I did not have any involvement with Sunil neither did he. I have been doing this without any staff knowing about my activities".
In a letter dated 12 August 2002 the Grievor again made admissions in relation to the allegations. In the fourth paragraph the Grievor states:
"Also to highlight that I have give Jone cash a few times for his personal request and that he assured me that he will return the same if he does not use it and that is what he did but in fact I did not expect he would betray me by committing forgery, whereby he sends third Party to me authorizing the voucher himself and when asked for the passbook he said to both the tellers that he got the passbook with him so pass the withdrawal and sent him/her to enquiries for him to update the passbook/ issue receipt etc. we had trust in him as we were not aware of his fraudulent authority and he took advantage of us".
Having considered the evidence given in the hearing and the material in the documents before it, the Tribunal is satisfied that the Grievor did carry out the actions which are the subject of the allegations. The Tribunal also accepts that those actions amounted to misconduct in that they breached the Company’s Policy and Procedures. The Tribunal is satisfied that the Company acted reasonably in concluding that the misconduct was sufficiently grave to justify summary dismissal in accordance with clause 4B (ii) (a) and (b) of the Collective Agreement.
It is important to stress that the issue is not whether the Grievor gained financially or whether he was aware of the fraudulent activities of other staff. The issue is that the Grievor by his actions has fallen below the high standard of integrity, honesty and trust which both the Company’s management and its clients rightly expect from its employee.
To the extent that there is a suggestion that other employees at the Savusavu Branch have not been dealt with in the same manner as the Grievor, the Tribunal accepts the evidence on behalf of the Company that all staff have been or are being investigated. The allegation of unequal treatment has not been established.
The Tribunal does not consider that the penalty was harsh in the circumstances of this case. Much has been made of the fact that the Grievor acted in good faith and trusted the other dismissed employee, Jone Saravaki. However, the Grievor gave evidence at the hearing that he had previously reported Jone Saravaki to management for conduct which was not in compliance with procedure. It appears to the Tribunal that the Grievor should have been aware that Jone Saravaki was a colleague who would not be trusted.
There is also a suggestion by the Union that the Bank was tardy in detecting breaches at Savusavu and lax in insisting upon proper implementation of its procedures. Whatever fault (if any) is attributed to the Company cannot alter the fact that the Grievor on a number of occasions acted in contravention of Policy and Procedures at the instigation of another employee whom he knew or ought to have known could not be trusted.
Consequently the Tribunal concludes that the summary dismissal was justified and reasonable and in that sense was fair. The penalty was not harsh.
However, the question of procedural fairness is not so clearcut. In any dispute involving dismissal, this Tribunal has consistently indicated that in order to establish fairness, the Company must also establish that the Grievor was afforded procedural fairness. That will require evidence that not only have procedural requirements in the Collective Agreement been complied with, but also the relevant general principles implied by Common Law.
Clause 21 (b) of the Collective Agreement states:
"(i) When an employee is being interviewed in connection with an alleged irregularity, which may lead to disciplinary action against the employee he/she shall be informed by the Manager or his/her nominee of:
1. the purpose of the interview
2. the fact that disciplinary action may result
3. the employee shall be informed of his/her rights. Ie. If he/she wishes to be accompanied and represented by a Union representative".
A document which purported to be a hand written transcript of the interview conducted on 5 June 2002 by Mr A Kumar with the Grievor in the presence of Mr K Mani was exhibit 1 in the hearing.
The Tribunal accepts that the purpose of the interview was adequately explained to the Grievor at the commencement of the interview.
The Tribunal accepts that the second requirement was not recorded as having been stated to the Grievor until the end of the interview. At the bottom of page 8 (of 9 pages) the following appears:
"Q: Didn’t you realize what you did by giving money to Jone you were committing serious breaches of procedure that may result in dismissal from employment?
A: I knew what I did was contrary to bank policies and procedures".
The Tribunal considers that this caution coming as it does as the second last question is not in keeping with the spirit of the requirement or its purpose.
There was no evidence before the Tribunal that the Grievor had ever been the subject of a disciplinary interview before 5 June 2002. When the interview commenced there was no reason why the Grievor could not have formed the view that this was no more than the first preliminary investigation into the allegations. He should have been made aware at the commencement of the interview that this was a disciplinary interview following which disciplinary action may result. The Tribunal accepts that this was not done. The Tribunal accepts the evidence of the Grievor on this issue in preference to the evidence of Mr Kumar.
The Tribunal also accepts that the third requirement was not complied with at the interview. The question put by Mr Kumar on page 2 of the interview is recorded as:
"Q: Do you want anyone also to be present on this interview.
A: Yes, Jone
Q: Are you a Union member
A: Yes"
This form does not comply with either the actual wording or the purpose of the third requirement in clause 21 (b).
The Tribunal is concerned that the Union was not accurately informed of the interview content in a letter dated 11 July 2002 from the Company. The General Manager Personnel, Mr Howard Politini, in response to a query from the Union, appears to be quoting from a communication received by him from Mr A Kumar. The passage quoted by Mr Politini reads as follows:
"Sunil was asked the following questions in the presence of Kamini before the commencement of the interview:
Q: Sunil are you a union member?
A: Yes
Q: Do you want anyone else to be present in the interview apart from Kamini and myself.
A: Its okay"
It should be noted that this material does not appear in the transcript. The material in the transcript was not relayed to the Union. In neither case does the question comply with the third requirement of clause 21 (b).
The alteration in the transcript from "No" to "Yes Jone" was made by the Grievor at the conclusion of the interview. Mr Kumar pointed out that although Jone Saravaki was the Union representative, he was also in effect a co-accused.
The interviews were conducted on 5 and 6 June 2002. The dismissal letter was dated 10 June 2002. There was no communication with the Grievor between those dates. Although the Grievor made admissions to the allegations in the interview conducted on 5 June 2002, he should have been given the opportunity either himself or by a Union representative other than Jone Saravaki to address the question of penalty and put forward any mitigating material.
For the reasons stated above the Tribunal has reached the conclusion that the Grievor was not afforded procedural fairness and to that extent the summary dismissal was unfair.
Although the Tribunal finds that the dismissal was unfair, it declines to order re-instatement. This is because the Tribunal considers that the Grievor’s admitted conduct has made it impossible for the company to maintain trust and confidence in him and for him to be a harmonious and effective member of the Company’s team.
In the circumstances the Tribunal considers it to be fair and reasonable for the Company to pay the Grievor 3 months salary as compensation for its breach of his procedural rights.
AWARD
The grievor’s summary dismissal was fair to the extent that it was reasonable and justified. It was not harsh.
The summary dismissal was unfair in the sense that the company failed to afford the Grievor procedural fairness as set out in clause 21(b) of the agreement and implied by common law.
Re-instatement is refused. The Grievor is to be paid 3 months’ salary for the Company’s breach of its obligations.
DATED at Suva this 31st day of August 2004.
Mr W D Calanchini
ARBITRATION TRIBUNAL
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URL: http://www.paclii.org/fj/cases/FJAT/2004/39.html