Drugs, lies and dismissal: employee ordered to pay indemnity costs

A truck driver who knowingly brought an unfair dismissal claim based on a fabricated drug test result has been ordered to pay his employer’s costs of over $18,000.

In June 2015, Toll Holdings Ltd, the driver’s employer, requested that he provide an oral fluid sample for testing under its drug and alcohol policy. The driver tested positive for both amphetamine and methamphetamine and he was dismissed from his employment a few days later.

Before his dismissal, the driver told Toll that he had asked another doctor, Dr Chaudhry, to administer a urine sample drug test which had allegedly shown no traces of drugs in his system.

The driver claimed that his dismissal was unfair because Toll had not taken into account the purported negative result.

The driver maintained that he had a negative test result in his unfair dismissal application, filed a witness statement attaching a fabricated test result and gave evidence to the same effect during the hearing.

Toll called Dr Chaudhry to give evidence in the proceedings. The driver’s claim immediately unraveled. The doctor produced the original urine test result which had also shown a positive result for drugs. Dr Chaudhry also confirmed that the ‘clean’ result relied on by the driver was not the result he had given him. The driver left the hearing part way through Dr Chaudhry’s cross-examination and subsequently instructed his representative to discontinue the proceedings.

Whilst the Fair Work Commission is generally a ‘no costs’ jurisdiction, the Commission has a discretion under the Fair Work Act 2009 to make costs orders against parties in certain circumstances, including, where it is satisfied that an applicant has made an application vexatiously or without reasonable cause.

In deciding whether to exercise its discretion, Deputy-President Gostencnik found ‘this is plainly a case in which indemnity costs are warranted’. His Honour found that the driver’s whole claim had been based on lies and false evidence that had been ‘designed’ by him even before he had been dismissed and he had persisted with his lie until caught out by the evidence of Dr Chaudhry. As such, the Commission found that the driver’s claim had been brought vexatiously, without reasonable cause and with no reasonable prospects of success.

Given that the driver had continued with his claim until he was rather spectacularly ‘caught out’, the Commission considered it to be an appropriate case to exercise its discretion with respect to costs and ordered that that the driver pay Toll’s costs of the proceedings on an indemnity basis. Costs of $18,618.31 were ordered to be paid within 28 days. The costs included legal costs and witness expenses.

This case serves as a useful reminder that costs can be awarded in appropriate cases. As such, employers who find themselves defending a claim which appears to be vexatious, or without reasonable cause or prospects of success, should carefully consider whether an application for indemnity costs may be warranted in the circumstances.