Maritime Safety Authority of Fiji v Narayan [2016] FJHC 1; ERCC13.2013 (4 January 2016)

IN THE EMPLOYMENT RELATIONS COURT
AT SUVA
ORIGINAL AND APPELLATE JURISDICTION

CASE NUMBER: ERCC13 of 2013
ERCA 17 of 2013

BETWEEN:

MARITIME SAFETY AUTHORITY OF FIJI
APPELLANT

AND:

SURESH NARAYAN
RESPONDENT

Appearances: Mr. P. Katiafor the Appellant.
Mr. R. Singh for the Respondent.
Date/Place of Oral Judgment: Thursday 15October 2015 at Suva.
Date/Place of Written Judgment: Monday 4 January 2016 at Suva.
Coram: Hon. Madam Justice Anjala Wati.

JUDGMENT

Catchwords:
Employment Law – Appeal –Summary Dismissal –assessing lawfulness of dismissal: examination of cause and procedure – assessing fairness of dismissal: examination of conduct of employer and manner of treatment provided to employee in carrying out dismissal- assessing remedies – reinstatement generally not permitted where the employee found to be cheating employer and incurring loss to the employer and public.

Legislation:

1. The Employment Relations Promulgation 2007 ("ERP"): ss.33; 34.
   

Cause/Background

1. There are two actions before this Court. The first was an original action filed on 14 October 2013 for compliance of theorder of the Employment Relations Tribunal ("ERT") of 22 September 2013. The second is the appeal against the same decision of the ERT which was filed on 18 October 2013. The original action is ERCC 13 of 2013 and the appeal action is ERCA 17 of 2013.
   
2. Since the Court was faced with two applications between the same parties regarding the same decision, it was prudent that the appeal be heard and the compliance matter to follow suit.
   
3. The employee Suresh Narayan ("SN") was employed by the Maritime Safety Authority of Fiji ("MSAF") as a Clerical Officer.
   
4. Sometimes in June 2012, MSAF, on the directives of the Permanent Secretary for Works, Transport and Public Utilities carried out an investigation on the employee SN who was at that time based in Savusavu occupying the position of an enforcement officer.
   
5. On 2 October 2013, SN was suspended without pay and was asked to respond to the allegations contained in the employer's letter. The suspension letter is to the following effect:
   

" 2nd October 2012

Mr. Suresh Narayan

Clerical Officer

Re: Suspension from Duties and Please Explain

We have received an allegation made against you in accordance with the provisions of the Whistle Blower Protection Policy which is one of the policies in our Human Resources Policy.

The allegations contained in the report allege that you had acted outside your authority:

1. Acted outside of your authority when you had requested for fuel in exchange of providing a Survey Certificate during and in the course of your employment as Clerical Officer with MSAF.
   
2. Acted outside your authority when you had requested vessel owners to deposit survey and other fees into your personal bank account.
   

It is alleged in the report that you had reached MSAF's zero tolerance policy and behaved unethically when;

3. You had requested favours (fuel) in exchange of providing Survey Certificates to vessel owners in the Northern Division.
   
4. You allowed vessel owners to deposit survey and other fees into your personal bank account.
   

Accordingly the aforementioned alleged actions of yours have breached MSAF's Human Resources Policy and constitute major misdemeanor and gross misconduct.

1. You are immediately suspended from your position as Clerical Officer, without salary with immediate effect.
   
2. You are to immediately handover all MSAF office keys, laptop, I.D. Card and MSAF documentations (soft and hard copy) and/orany MSAF properties that you have in your possession.
   

100. However you are provided with seven (7) working days (effective from the date of this letter) to provide a written explanation as to the allegations contained in this letter.
     

4. You are banned from entering any MSAF premises during your period of suspension and you are instructed not to interfere with any witnesses, investigators and or manipulate any documents; investigations may require your presence and you will be advised accordingly.
   
5. You are to note that the nature of these is serious and if proven, may result in termination of your employment with MSAF.
   

You are welcome to send your responses via an e-mail but will require making an appointment with me if your need to personally hand deliver your explanation".

6. The suspension letter was received by SN on 2 October 2012.
   
7. On or about 8 October 2012, SN responded to the said allegation by an email to the Chief Executive Officer. His response was to the following effect:
   

"Sir, this is to bring to your attention the above two (2) allegations against me No. s 1 & 2.

However, I deny both the allegations.

Furthermore, Sir please refer to correspondence via email to respective managers on 12th and 13th of August and also via telephone to shipping officer on allegation (1).

The allegation is baseless/unfounded without prove, it is just to frame me as a result of doing my work honestly.

Please take note that procedures for all surveys of vessels as well as issuance of survey certificates are handled by respective managers/chief executive officer. I do not have any authority in that regard. I am a clerical officer and do not have authority in regards to clearance of vessels/surveys as there are respective officers based – E & C Officers 1 & 2 in Savusavu.

The second allegation regarding deposit of survey fees in to my personal account is not true. Please take note that all MSAF revenue received is either by TMO (Post Office), paid by cheque or paid cash by stakeholders/agents into the office.

My twenty five (25) years of honest and dedicated service in various stations whilst employed by Marine Department, FIMSA/MSAF has a clean records and speaks volumes.

Sir, I am requesting for immediate uplifting of my suspension which is based on unfounded evidence and hearsay allegations.

Many thanks".

8. Thereafter on or about 21 November 2012 the employee referred the grievance to the Ministry of Labour requesting immediate reinstatement and compensation for loss of salary. Whilst the matter was going through mediation, MSAF summarily dismissed the employee for gross misconduct. The termination letter was dated 23 January 2013 and had a retrospective effect from 2 October 2012. The letter reads:
   

"Re: Summary Dismissal

We refer to the initial suspension and please explain letter provided to you on the 2nd October 2012 which raised various allegations against you.

The Maritime Safety Authority of Fiji herein after referred to as the "Authority" received a complaint from one of the vessel Masters that you were asking for favours like fuel in return for arranging for surveys and survey certificates for their vessel.

It had also come to the knowledge of the Authority that you vessels owners depositing survey and other fees into your personnel bank account.

In addition you requested some of the vessel owners for extra amounts of money, which has remain unaccounted and undeclared in return of arranging for certificates and surveys (in your capacity as an employee of the Authority)

Subsequently an investigation was conducted on the directive of the Chief Executive Officer of the Authority and you were provided with a Please Explain to show cause as to why you should not be disciplined for gross misconduct, acting outside one's authority, misrepresentation and manipulating and doctoring Authority records.

You were provided seven (7) days to respond to the allegations raised in the letter served to you on 2nd October 2012. Having received and carefully considered your explanations on 8th October 2012 in which you had vehemently denied both the allegations, the management has established that you are guilty of gross misconduct, acting outside your authority and manipulating and doctoring Authority records.

The offences are as follows:

1. You acted outside your authority when you had provided your personal bank account to vessel owners to deposit funds/ fees and other dues. This offence took place on 27th January 2012 when you had requested the owner of a vessel to deposit fees due to the Authority into your personal bank account.
   
2. You had manipulated and/or doctored Authorities records and documents when you had deposited Authority's income into your personal bank account and then issued receipts three (3) working days after the actual deposit.
   
3. You had misrepresented to the Authority for personal gain when you had requested fuel from a Boat Master in return for you to sorting out his expired survey certificate.
   
4. You had misrepresented the Authority for personal gain when you had requested extra sums of money from vessel owners when they requested assistance in matters pertaining to their vessel and licensing.
   

These offences constitute gross misconduct and in accordance with section 33 of the ERP 2007 you are summarily dismissed retrospective from 2nd October 2012. The Authority terminates your employment forthwith without payment of any compensation or salaries due to your suspension.

You are to return any property belonging to the Authority in your possession in order for the Authority to process any outstanding salary or annual leave accrued".

9. The matter was not settled and ended up in the Tribunal after a defended hearing.
   

ERT's Findings

10. The ERT found that the employee's dismissal was unjust and unfair and as a result awarded the following remedies:
    

(a). reinstatement to worker's former position;

(b). reimbursement of the whole of the wages lost by him as a result of the grievance; and

(c). payment to the worker of a further 6 months' wages as compensation for humiliation, loss of dignity, and injury to feelings.

11. In arriving at the conclusion that the dismissal was unlawful and unjustified, the ERT found that:
    
    1. the cause for terminating the employee was established in that there was gross misconduct on the part of the employee which led to the termination however the procedures followed in terminating the employee was not proper in that:
       
       • (i) It was the duty of MSAF to provide the employee with all reports and information for the employee to comment on the same before any decision was made, which was breached by MSAF;
         
       • (ii) It was the duty of MSAF to make the employee aware that he was entitled to legal representation and to ensure that he is properly represented at all stages of the enquiry. The employee perhaps would not have said or done something if he had good legal advice. This duty was also breached by MSAF.
         
       • (iii) MSAF did in this case what a fair and reasonable employer would not have done by suspending the employee and when the mediation was in progress terminated his employment.
         

Grounds of Appeal

12. Aggrieved at the decision, the employer appealed raising 14 grounds of appeal alleging that the ERT erred in law and in fact:
    
    1. in holding that the employer had made out a case of gross misconduct without exhausting its own internal procedures in the Appellant's Human Resources Policies.
       
    2. in holding that the employer failed to meet its fair process standards and that it relied upon this failure to make findings against the employee without representation and advice.
       
    3. in holding that the employer did in this case what a fair and reasonable employer would not have done in that it disadvantaged the employee by its unjustifiable action of demoting him when there is no evidence of this available to the ERT to make such a finding.
       
    4. in failing to take into account that the employer had provided the employee with an opportunity to respond to the allegations made against him when the suspension letter was given to him on 2 October 2012 for two allegations which were that the employee requested for fuel favours in exchange for providing survey certificates and for allowing vessel owners to deposit survey and other fees into his personal bank account.
       
    5. in not taking into account the evidence of Captain Siga Tale who was an independent person and who had no interest in the matter.
       
    6. in holding that the substantive decision made by the employer that the employee was guilty of gross misconduct was unjustifiable when all facts looked at by a fair and reasonable employer point to gross misconduct by a senior officer in asking for fuel from vessel owners or its stakeholders and for depositing monies paid by owners of vessels into his personal account.
       
    7. in holding that management made out a case of gross misconduct without exhausting its own procedures which have been suspended when what was meant was that the employer exercised its discretion under s. 33 of the ERP to summarily dismiss the employee on the grounds of gross misconduct.
       
    8. in holding that the basis of summary dismissal should not be considered because due process was not accorded to the employee when he was afforded an opportunity to explain his position which he did by an email.
       
    9. in holding that the employer should have given the employee an opportunity to be accompanied by a representative at all stages of the inquiry when there is no such requirement imposed on the employer by contract or by law.
       
    10. in not giving weight to the employer's notice to the employee to produce statements of his account number 1946194 at the Bank of South Pacific or that the account belonged to him and his wife.
        
    11. in failing to give directions and consider that the employee chose not to answer the questions of the employer on the issue that a vehicle owner had deposited a sum of $431.75 in his account at BSP 1946194.
        
    12. in holding that the employee was disadvantaged by the unjustifiable action of the employer in first suspending him before serving him with a summary dismissal letter when parties were in mediation when the employer retains the right to summarily dismiss an employee at any time.
        
    13. in awarding the remedy of reinstatement and payment of all lost wages when the summary dismissal was proper for gross misconduct.
        
    14. in awarding the employee compensation of 6 months' wages for humiliation, loss of dignity and injury to feelings when this was neither pleaded nor any evidence given to that effect to qualify for an award.
        

Submissions

13. Mr. Katia admitted that most of his appeal grounds of appeal are overlapping and repetitive and so he will argue the appeal in a general manner. I do not see the need for counsel to repeat the grounds of appeal. By doing that they are consuming their own time and that of the Court. Grounds of appeal must be precise, must not contain arguments and must not be repetitive. I hope these comments will be taken seriously and in future appeals from the same legal practice will avoid this untidiness.
    
14. Mr. Katia argued that the ERT recognized that the employer had its Human Resources Policy and said that the employer did not follow the same. Under the Human Resources Policy, cases of gross misconduct are dealt with by the CEO in his discretion.
    
15. It was also submitted that the employer is under no contractual or legal obligation to provide the employee with legal representative or to ensure that the employee is represented.
    
16. The ERT also made a finding that the employee was demoted when there was no such evidence to this effect.
    
17. The employer had provided the ERT with substantial evidence on the act of gross misconduct of the employee. Captain Siga Tale was an independent witness. He gave evidence that the employee did ask for fuel. His evidence was not challenged by the employee. There was also evidence that boat owners were depositing monies in the employee's account. How would they know his account number when he did not ask them to deposit it in that? The inference that ought to have been drawn especially after the employee failed to answer whether he asked the monies to be deposited in his account should have been that the employee provided the vessel owners with his bank account details and instructed them to deposit the monies in his personal account which in fact was done.
    
18. The employee was also given a chance to respond to the allegations when there is no requirement in cases of gross misconduct that such chances be given. Out of good faith the employer allowed him the opportunity and also told him the specific allegations against him.
    
19. There was no unreasonable act on the part of the employer when it proceeded to summarily dismiss the employee whilst the mediation was in process between the parties. The employer retains the right to dismiss the employee for gross misconduct.
    
20. Mr. Katia also argued that there was no evidence that the employer's conduct in carrying out the dismissal was bad or wrong or unfair and that the employee suffered any humiliation due to that. There was therefore no evidence to establish unfair dismissal and any such award under that head is improper.
    
21. On the question of remedies, Mr. Katia argued that since misconduct was established, the employee is not entitled to any remedies.
    
22. Mr. Singh argued that the investigation reports against the employee were never shown to the Union or the employee. It is a requirement of natural justice that a party against whom a case is being made out be given the full disclosures of facts against him. This is what the ERT correctly found was missing in the process leading to the termination.
    
23. The contract of service did not allow for summary dismissal. The employer chose a procedure of investigation and if that was the process that was chosen, the employee was entitled to a hearing before the decision was made.
    
24. The employee was not found guilty of gross misconduct so the allegation is not established. The Human Resources Policy ought to have been followed. There are so many versions and if the employee was to be treated fairly, those policies ought to have been followed.
    
25. It was also argued that the employee did not produce the joint account statement because it belonged to his wife too. He ought to have been asked for disclosures. There was no evidence that money was deposited in his account.
    
26. Further, there was bad faith on the part of the employer when it tendered a dismissal letter to the employee when the parties were trying to mediate the issue of suspension. The process of mediation was frustrated and this shows bad conduct on the part of the employer.
    

Law and Analysis

27. I will first deal with the issue of the cause for summary dismissal. The ERT held that the cause for dismissal was justified. It said at paragraph 4.6 of the judgment as follows:
    

"From the evidence the MSAF laid out the reason for dismissal to be gross misconduct and I am attracted irresistibly by the evidence that management made out a case of gross misconduct without exhausting its own procedures which have been suspended".

28. The second part of the above finding is confusing but I interpret it to mean that although the cause for dismissal was justified, the procedure was not.
    
29. Even if I am wrong in understanding what the ERT said, I find from the evidence that the case of gross misconduct was established. Captain Siga Tale gave evidence that the employee asked for fuel from them when one of his crews had gone to the employee to ask for grog cloth. This evidence was put to the employee and he refused to answer the allegations. He chose to keep quiet.
    
30. Another allegation against him was that he received in his personal bank account the monies of the employer in the sums of $431.74 and $4,119.89. Two deposit slips were tendered in as evidence during the trial.
    
31. The employee was asked to produce his statement from account number 1946194. He stated that it was a joint account in his name and the name of his wife. This indicated that the employee accepted that he owned that account. There were deposit slips made out in the name of the employee in the sum of $431.74 and $ 4,119.89 in respect of this account. The ERT did not place any weight on this evidence on the basis that the deposit slip did not have any bank stamp.
    
32. The ERT failed to give weight to the fact that the employer had on the balance of probability established that monies used to be paid in the personal account of the employee. How else will the customers know his account number? When the employee was asked whether he was receiving money in his account, he chose to remain silent. This is all indicated that the employer's evidence was not contradicted and the case of gross misconduct established.
    
33. If the ERT has failed to make a finding of gross misconduct, it is open to this court to make a finding on the available evidence and I repeat that the employer's evidence was largely not contradicted based on which it is established that the employee used to ask vessel owners for fuel favours and asked them to directly deposit the employer's money in his personal account. All this amounts to dishonesty and theft and should not be condoned by any employer.
    
34. On the question of whether the correct procedure was followed, I do not find that it was as the termination letter which was served on the employee a day after made the termination retrospective to the date of suspension. S. 33(2) requires that the written reasons for dismissal be given to the employee at the time of dismissal. This is a section on summary dismissal. If the dismissal was carried out under s. 33 of the ERP, then that procedure ought to have been followed.
    
35. Mr. Singh argued that there is no provision for summary dismissal in the contract. This is not correct. Clause 10 (f) of the contract provides that the employer can terminate without notice if the employee is guilty of any neglect or serious misconduct which justified summary dismissal. A right to hearing is not provided for by that contract. This provision of the contract is analogous to s. 33 of the ERP which I have discussed above.
    
36. Whether the dismissal was unfair, the Court will assess whether the employer acted in bad faith or the manner of treating the employee was improper or unfair. There was no evidence to that effect that the employer acted in bad faith or in a way that humiliated, demeaned or caused injuries to the feelings of the worker. Any remedy therefore under that head was not properly founded on the facts.
    
37. Mr. Singh argued that it is bad faith on the part of the employer to serve the employee with a dismissal letter when the parties were undergoing mediation. It is the prerogative of the employer to dismiss the employee at a time it feels that allegations against it is sufficient to justify the dismissal. Even if the mediation was in process, the employer had the right dismiss the employee. There is nothing in law that precludes the employer from doing that. That is not bad conduct on part of the employer rather an exercise of right.
    
38. I must also deal with the ERT's findings that the employer was under an obligation to provide the employee with all reports and information for him to make comments on before the dismissal. The employer is not obliged to provide any such information. it will carry out its own investigations and if it is satisfied on the facts available to it that one or more causes has been made out under s. 33 of the ERP, it can proceed to carry out the summary dismissal. If the employee feels that the dismissal is unlawful or unfair, his or her recourse is to the Court for determination where the employer will have the onus of establishing that the cause was justified, the procedure properly followed and that it acted in good faith without malice.
    
39. Despite not being required to provide any information to the employee before carrying out the dismissal, the employer did put all the allegations to the employee to comment upon. He was thus given a chance to explain his position and not deprived of any explanation.
    
40. The ERT found that it was the obligation of the employer to provide or to ensure that the employee was represented at all stages of the proceedings. There is no such obligation imposed on the employer by the contract or the ERP and by finding to that effect, the ERT has placed an onerous burden on the employer which is neither supported by the agreement of the parties or the law.
    
41. The ERT stated that if legal representation was provided, the employee would not have said or done anything to jeopardise his position. In fact the employee did not make any admission of the allegation so there was no prejudice caused to him when he without being represented responded to the allegations. Furthermore, if the employee felt that he wanted legal representation, it was open to him to seek one and then respond to the allegations. The employer, on the evidence, never precluded the employee from seeking such representation.
    
42. The ERT's assessment of what is fair procedure in carrying out the dismissal is not supported by law and thus the findings in that regard are set aside.
    
43. In the final analysis I find that the cause for dismissal was justified but the procedure was not as written reasons for dismissal was not provided to the employee at the time of dismissal. There was, I find, no evidence to establish that the dismissal was unfair.
    
44. I must also make some comments about the ERT's finding that the employee was demoted. In paragraph 4.9 of its judgment the ERT states that it was going to examine the process leading to the employee's demotion. Mr. Katia says that there was no evidence to this effect that the employee was demoted. He was first suspended then terminated. I find that the use of the word demotion is a typographical error. There was never any evidence of demotion. The word should be dismissal. The rest of the judgment does not even use the term demotion.
    
45. On the question of remedies, since the allegation of gross misconduct was established, it is established that the employee is a dishonest person. He worked for his gain and for the loss of the employer. It is not fair and in the interest of this employer and the public that he be kept at employment. The productivity of employment is affected as well as the public who are being cheated by such people.
    
46. The most suitable remedy is part of the wages lost as a result of the grievance. I say part because the onus was on the employee to mitigate his loss and he did not give any evidence why he could not or did not find another employment when he was terminated. Another reason is that this employee has been established to have banked substantial amount of the employer's money into his personal bank account thus reaping benefits unjustly.
    
47. The employee is expected to have found a job within the six months period so I award him only 6 months' lost wages.
    

Final Orders

48. I allow the appeal on the basis that the employee was guilty of misconduct for which he was terminated but that the employer did not follow proper procedure in carrying out the dismissal thus making it unlawful for want of correct procedure. The employee is thus entitled to part wages lost as a result of the dismissal which I so order to be six months wages.
    
49. Each party must bear their own cost of the appeal proceeding.
    

Anjala Wati
Judge

04.01.2016
____________________
To:

1. Mr. P. Katiafor the Appellant.
2. Mr. R. Singh for the Respondent.
3. Files: (1). Suva ERCC 13 of 2013.

(2). Suva ERCA 17 of 2013.