Alexandra Milonas v Telstra Corporation Limited

[2017] FWC 6359

[2017] FWC 6359 [Note: An appeal pursuant to s.604 (C2017/7228) was lodged against this decision - refer to Full Bench decision dated 26 March 2018 [[2018] FWCFB 1683] for result of appeal.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Alexandra Milonas
v
Telstra Corporation Limited
(U2017/4027)

COMMISSIONER CAMBRIDGE SYDNEY, 8 DECEMBER 2017

Unfair dismissal - extensive period of alleged under performance - conduct in response to performance management - valid reason for dismissal - satisfactory warning - reasonable opportunity provided for improvement - personal circumstances considered - dismissal not harsh, unjust or unreasonable - application dismissed.

[1] This matter involves an application for unfair dismissal remedy made pursuant to s. 394 of the Fair Work Act 2009 (the Act). The application was lodged at Sydney on 12 April 2017. The application was made by Alexandra Milonas (the applicant) and the respondent employer is Telstra Corporation Limited (the employer or Telstra).

[2] The application indicated that the date that the applicant’s dismissal took effect was 23 March 2017. Consequently, the application was made within the 21 day time limit prescribed by subsection 394 (2) of the Act.

[3] The matter was not resolved at conciliation and it has proceeded to arbitration before the Fair Work Commission (the Commission) in a Hearing conducted at Sydney on 24 July, 6 and 7 November 2017.

[4] At the Hearing, Mr T Rogers appeared as Counsel for the applicant. Mr Rogers called the applicant as the only witness who provided evidence in support of the unfair dismissal claim. The employer was represented by Mr J Darams, of Counsel, who was instructed by Seyfarth Shaw Australia lawyers. Mr Darams called two witnesses, Messrs Phillip Moynahan and Vincent Bates who provided evidence on behalf of Telstra.

Factual Background

[5] The applicant had worked for Telstra for just over 22 years. The applicant was initially engaged in a position described as Customer Service Representative. The applicant worked in a number of different positions during her extensive period of employment with Telstra. Relevantly, in 2006 the applicant moved into a position described as Mobile Sales Specialist (MSS). In the role of a MSS, the applicant performed a range of sales related duties which involved the retention and extension of mobile phone and other telecommunications services to a designated portfolio of existing and potential Telstra customers.

[6] The employer is a large Australian telecommunications and media Company which, together with its subsidiary Companies, employs more than 30,000 people.

[7] Prior to about 2011, the employment history of the applicant was generally commendable, and the applicant received various awards in recognition for her achievements in sales performance. In about early 2011, the customer portfolio assigned to the applicant was changed. The applicant was assigned a customer portfolio that involved Government and not-for-profit organisations including charities, churches, schools and universities (the not-for-profit portfolio).

[8] The applicant raised concerns about the allocation of the not-for-profit portfolio as she understood that it represented a “dud” portfolio because it included a large number of customers and potential customers that were unlikely to generate significant sales opportunities or volumes. The applicant complained that the not-for-profit portfolio required increased work load for lower sales returns both in terms of volume and sales revenues achieved.

[9] The role of an MSS involved a requirement to meet an annual sales target figure which included sales revenue from retained existing services combined with an incremental sales revenue obtained from sales of new services to either existing customers or new Telstra customers. The applicant found it increasingly difficult to achieve her annual sales targets having been assigned the not-for-profit portfolio. The applicant believed that the sales target figures that were set for her in the not-for-profit portfolio were unrealistic.

[10] In 2012, Telstra implemented an organisational re-structure that included, inter alia, a changed job description for the MSS role which reflected the introduction of new technologies, particularly impacting upon mobile telephony services and related applications. The applicant maintained her not-for-profit portfolio under the re-structured arrangements.

[11] During 2013, the applicant raised ongoing complaints about her customer portfolio with her then Manager and immediate superior, Mr Bates. The applicant was not achieving her sales target figures, and various discussions occurred between the applicant and Mr Bates concerning the applicant not meeting sales performance expectations. In response to the complaints made by the applicant, Mr Bates allocated a new customer (NSW Health) to the applicant’s portfolio. However, the applicant did not experience any significant sales performance improvement from the allocation of NSW Health to her customer portfolio as she encountered considerable difficulties with securing the business of particular entities within the NSW Health group.

[12] In 2014, the applicant and Mr Bates had various discussions about the prospect that the applicant would look for a different job as she was experiencing ongoing performance difficulties. The applicant maintained that her sales performance targets were unrealistic, but as a result of some apparent tensions between herself and Mr Bates, the applicant openly contemplated a move to a different position.

[13] By November 2014, the applicant had not moved from the MSS position, and Mr Bates commenced an informal performance management process for the applicant. Although there was an initial improvement in the applicant’s sales performance (72% achieved for a target of 80%), which was recognised in January 2015 1, Mr Bates observed a subsequent deterioration in the applicant’s sales performance, and he placed her on a formal Performance Support Agreement (the 2015 PSA) on 16 February 2015.

[14] The timeframe for the 2015 PSA was extended partly as a result of the applicant’s deteriorating health and her consequent absences from work. Towards the end of April 2015 the applicant declined to participate in one-on-one meetings with Mr Bates which were held as part of the 2015 PSA, and she advised Mr Bates that the performance management process was causing her considerable stress and anxiety.

[15] On 26 May 2015, Mr Bates issued the applicant with a written warning regarding her performance and following on from a review of the 2015 PSA. This written warning recorded that the sales performance achieved by the applicant was 56% of an 80% target. Further, the written warning advised that the 2015 PSA would be further reviewed on 22 June 2015, and in the absence of improvement in sales performance, Telstra may take further action which could include termination of the applicant’s employment.

[16] On 1 June 2015, the applicant suffered from a panic attack whilst at work and she was subsequently diagnosed with suffering from acute stress. The applicant was then absent on a period of extended sick leave until she returned to work in October 2015. The applicant also made a complaint alleging that she had been bullied by Mr Bates. The bullying complaint against Mr Bates was investigated internally and not substantiated. However, upon her return to work in October 2015, the applicant reported to a different immediate superior, Mr Proctor, the 2015 PSA was not pursued further, and the applicant’s customer portfolio and sales targets were reviewed and adjusted.

[17] In August 2016, as a result of an injury sustained by Mr Proctor, the responsibility for immediate supervision and management of the applicant was taken over by the General Manager of Enterprise Mobility, Mr Moynahan. In August 2016, Mr Moynahan met with the applicant and discussed the recent history of her sales performance including the 2015 PSA. Mr Moynahan implemented an informal performance management process aimed at assisting the applicant improve her sales figures. As part of this process, Mr Moynahan held regular one-on-one meetings with the applicant, and he provided documentary summaries of matters relating to particular sales and reporting requirements, together with anticipated action plans aimed at improving the sales performance of the applicant.

[18] In October and November 2016, Mr Moynahan became concerned that the applicant had not improved her sales performance or implemented particular actions including the provision of regular weekly reports, and other activities involving sales forecasting documents. At the request of the applicant, Mr Moynahan implemented various activities and associated arrangements which were designed to assist the applicant. The applicant was provided with a new computer, her targets were reviewed and adjusted, she was provided with specialist assistance, and additional training.

[19] On 23 November 2016, Mr Moynahan advised the applicant that he intended to move her onto a (second) formal PSA as he had not identified sufficient improvement in the applicant’s sales performance and related activities such as the provision of documentary reporting. The applicant did not react favourably to the indication from Mr Moynahan that he intended to place the applicant on a formal PSA. The applicant became quite emotional and there was something of a difficult discussion between her and Mr Moynahan about her future with Telstra and her reaction to being moved onto a second PSA.

[20] On 15 December 2016, Mr Moynahan met with the applicant and advised her that he had decided to place her on a PSA (the 2016 PSA). Further, Mr Moynahan issued the applicant with a written warning regarding her unsatisfactory performance indicating that the applicant had achieved a low 50% of a 90% target for incremental sales in the months of October and November. This written warning also indicated that if the applicant failed to improve her performance Telstra may take further action which could include termination of the applicant’s employment.

[21] Particular aspects of the 2016 PSA were adjusted at the request of the applicant and the timeframe for its review was extended. As a result of the applicant being on carers leave and absent on personal leave there was a series of delays with arrangements for a meeting to review the 2016 PSA. Eventually, on 23 March 2017, a meeting was held for the purposes of reviewing the 2016 PSA. The applicant attended this meeting, and she was provided with assistance from a support person who was a Union organiser. Various Telstra managers including Mr Moynahan also participated in the meeting of 23 March.

[22] The applicant made an audio recording of the 2016 PSA review meeting held on 23 March 2017. This recording was made with the knowledge and consent of those who participated in that meeting. A copy of the transcript of the meeting as recorded by the applicant, became Exhibit 4 in these proceedings. During the meeting of 23 March, there was a discussion about the various aspects of the 2016 PSA including the specific sales performance figures that had been set and other issues such as identification of the applicant’s work in respect to planning and reporting documentation. The applicant took issue with the various concerns that were raised by Mr Moynahan during the meeting as matters which he asserted established that the applicant had not satisfied the requirements of the 2016 PSA. Further, the applicant was invited to provide details of particular sales related activities that she had undertaken during the period of operation of the 2016 PSA.

[23] During the meeting held on 23 March 2017, Mr Moynahan also recounted the recent history of performance management undertaken for the applicant and the overall performance ratings that she had achieved in annual performance figures for the past few years. The applicant was given an opportunity to comment upon the concerns raised by Mr Moynahan both in respect to the 2016 PSA and the more historical performance management matters. The applicant provided detailed criticisms including that she believed that she had been subject to a campaign of excessive scrutiny and significant negativity. Further, the applicant rejected that in historical terms, her situation represented a long-term underperformance.

[24] The meeting was adjourned to enable the relevant Telstra managers to consider the responses that had been provided by the applicant in respect to the review of the 2016 PSA in the context of the recent history of performance management processes that had been undertaken for the applicant. Upon resumption of the meeting, Mr Moynahan advised the applicant that her employment had been terminated on the basis that the applicant’s performance had not improved in accordance with the expectations of the 2016 PSA.

[25] The applicant was subsequently provided with a letter of dismissal dated 23 March 2017, which confirmed the termination of her employment based upon ongoing unsatisfactory performance. The letter of dismissal also included certain particular issues of alleged underperformance, and it referred to the 2015 and 2016 PSAs and the annual performance ratings achieved by the applicant in recent years.

[26] At the time of Hearing, the applicant had not obtained alternative employment but indicated that some significant potential had recently emerged regarding new employment.

The Case for the Applicant

[27] The applicant was represented by Mr Rogers who made verbal submissions. Mr Rogers also referred to documentary material that was provided to the Commission at the Hearing.

[28] The submissions made by Mr Rogers outlined the applicant’s employment history with Telstra and he stressed that the employment involved a period of over 22 years. Mr Rogers noted that the applicant had performed work in various roles and that she had won various awards for her performance as recently as 2007. Mr Rogers said that in late 2010 or early 2011, the applicant was given a different customer list which involved something like 10,000 individual accounts and that it was at this point that difficulties began to emerge in respect to the applicant’s sales performance. However, Mr Rogers submitted that these difficulties were caused by the particular customer portfolio that had been assigned to the applicant rather than any fault on her part.

[29] Mr Rogers submitted that the Commission should draw an adverse inference from the absence of any evidence produced by Telstra which could demonstrate that the sales figures for whoever was doing the particular work of the applicant after she had been dismissed, verified any increased sales performance. Mr Rogers said that the absence of this evidence should tell heavily against Telstra’s assertion that the applicant’s complaints about being assigned a “dud” customer portfolio were unjustified.

[30] In further submissions, Mr Rogers made detailed reference to the various disputes that had arisen between the applicant and both Mr Bates and Mr Moynahan regarding the correct determination of the sales targets figures that had been set for the various customers identified in the not-for-profit portfolio allocated to the applicant. Mr Rogers submitted that inaccuracies, inconsistencies and errors had arisen which ultimately verified that the sales targets that had been fixed for the applicant were unrealistic as had been asserted by the applicant. In this respect, it was submitted that the applicant was “doomed to fail.”

[31] Mr Rogers made further submissions which criticised the particular circumstances that led directly to the termination of the applicant’s employment. Mr Rogers submitted that the circumstances of the applicant’s dismissal were “not attractive.” Mr Rogers made criticism of evidence that Mr Moynahan pressed the applicant to participate in the 2016 PSA review meeting by way of telephone whilst she was on carers leave. Further, Mr Rogers submitted that the process that was ultimately adopted during the meeting of 23 March 2017, denied the applicant a proper opportunity to respond to the issues of concern that had arisen from the 2016 PSA review.

[32] Mr Rogers also made a submission which conceded that if the facts were established as contended for by Telstra, the dismissal may not be characterised as unreasonable or unjust. However, according to Mr Rogers, the dismissal would, on any view, be harsh. In this regard Mr Rogers referred to the extensive period of the applicant’s employment which he described as a “lifetime of employment” with Telstra. In addition, Mr Rogers submitted that the dismissal of the applicant was harsh because of other personal circumstances involving a large mortgage and her age.

[33] The submissions made by Mr Rogers involved further criticism of the absence of evidence that Telstra had explored other options other than dismissal of the applicant. Further, Mr Rogers submitted that evidence of any suggested loss of trust and confidence between the employee and the employer should be rejected, and that no impediment to reinstatement of the applicant should arise. Mr Rogers submitted that the dismissal of the applicant was harsh, or rather unfair, and that the applicant sought reinstatement.

The Case for Telstra

[34] Telstra was represented by Mr Darams who submitted that the dismissal of the applicant was not unfair. Mr Darams made submissions which elaborated upon documentary material dated 10 July 2017, which had been filed on behalf of the employer.

[35] Mr Darams firstly referred to the three aspects that Mr Rogers had submitted represented basis for a finding that the dismissal of the applicant was unfair. Mr Darams noted that the first assertion made by Mr Rogers was that the sales targets that the applicant was given were unreasonable, and therefore any failure to achieve those targets did not represent valid reason for dismissal. Secondly, the dismissal was said to have been unfair because there were any number of alternative jobs that the applicant could have performed within Telstra. Thirdly, it had been asserted by Mr Rogers that the dismissal was unfair because it was harsh given the particular personal circumstances of the applicant.

[36] Mr Darams submitted that any determination as to whether a valid reason existed did not involve the Commission “standing in the shoes of the employer” but rather, valid reason had to be established from the perspective of the employer. In this regard, it was submitted that Telstra was entitled to set and determine targets and performance criteria and ultimately measure an employee’s performance against its own expectations. Mr Darams submitted that the applicant was engaged in a sales role, and it was obvious that an essential requirement of her position was to make sales and achieve particular sales performance levels. According to the submissions made by Mr Darams, any clear failure to achieve the sales performance levels determined by Telstra represented valid basis for dismissal.

[37] Mr Darams further submitted that it was important to recognise that the applicant’s performance was not solely assessed upon whether specific sales targets had been achieved. Other factors which included the provision of weekly reports, and the development of portfolio plans, and forecasting sales documentation, were all issues that contributed to an overall performance assessment. Mr Darams said that the evidence established that in every year from 2012 onwards the applicant’s overall employment performance had been assessed as not meeting expectations.

[38] It was also submitted by Mr Darams that there was evidence of extensive assistance provided to the applicant during the periods that she was involved in both formal and informal performance management processes. In this regard, Mr Darams mentioned that the applicant had been provided with extensive one-on-one assistance from both Mr Bates and Mr Moynahan. Further, the applicant had been provided with a new computer, and she had been given training including external training in Melbourne, and Telstra had assigned individuals to provide direct assistance to the applicant at different periods throughout the protracted performance management processes.

[39] Mr Darams submitted that despite the extensive and protracted assistance given to the applicant it was clear that she had been unable to meet the expectations of the role as had been assessed by Telstra. According to Mr Darams, Telstra was entitled to rely upon the record of the applicant’s poor performance in every year from 2012. Mr Darams submitted that it was unarguable that a failure to perform a role to the level expected established a valid reason for dismissal, and that valid reason was clearly confirmed as the basis for the dismissal of the applicant on 23 March 2017.

[40] It was also submitted by Mr Darams that any criticism of the procedure that Telstra adopted regarding the dismissal of the applicant should be rejected. Mr Darams acknowledged that the advice of dismissal which was provided to the applicant after the meeting resumed on 23 March, may not have represented an approach that involved perfection, but in the particular circumstances of this case it was nevertheless appropriate. Mr Darams submitted that the applicant had been provided with notice that her employment may be terminated and she had been given an opportunity to respond both throughout the extensive period of performance management and during the meeting held on 23 March. Consequently, it was submitted that the applicant had been afforded procedural fairness and provided with an opportunity to respond to the performance issues which underpinned her dismissal.

[41] Mr Darams further submitted that there was no basis to find that the dismissal of the applicant was otherwise harsh because of the particular personal circumstances of the applicant. Mr Darams said that the long period of service of the applicant needed to be countered by the long period of recorded underperformance, and that other personal circumstances of the applicant were not of a particular nature as to establish any harshness that might otherwise be found in respect of all terminations of employment.

[42] Mr Darams also rejected the assertion that the dismissal of the applicant was unfair because Telstra should have provided another position for the applicant. Mr Darams submitted that it would be clearly counterintuitive for an employer to contemplate an alternative position within its organisation for an employee who had the particular poor performance demonstrated by the applicant over an extensive period. This approach was described by Mr Darams as a proposition that the employer would be required to move one problem from one area to another. Mr Darams said that there was no obligation at all on an employer to contemplate the retention of non-performing employees.

[43] Mr Darams referred to the written submissions that had been filed on behalf of Telstra, which he said further supported his contention that all of the relevant factors identified in s. 387 of the Act when properly evaluated, provided sound basis for the dismissal of the applicant. Mr Darams submitted that in all of the circumstances there was no foundation to render the dismissal of the applicant to be harsh, unjust or unreasonable. However, if contrary to the submissions made by the employer, the dismissal was found to be unfair, Telstra sought to make further submissions in relation to the question of remedy. Mr Darams concluded his submissions by reiterating that the dismissal of the applicant should not be found to have been unfair. Mr Darams submitted that the application for unfair dismissal remedy should be dismissed.

Consideration

[44] Section 385 of the Act stipulates that the Commission must be satisfied that four cumulative elements are met in order to establish an unfair dismissal. These elements are:

“(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.”

[45] In this case, it was clear that the matter was confined to a determination of that element contained in subsection 385 (b) of the Act, specifically whether the dismissal of the applicant was harsh, unjust or unreasonable.

[46] Section 387 of the Act contains criteria that the Commission must take into account in any determination of whether a dismissal is harsh, unjust or unreasonable. These criteria are:

“(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.”

387 (a) - Valid reason for the dismissal related to capacity or conduct

[47] In this instance, the evidence has established that the applicant was dismissed for reasons relating to ongoing unsatisfactory work performance. In particular, the reason for the applicant’s dismissal involved her repeated failure to meet the performance criteria that had been established in formal performance improvement programs which were referred to as PSAs. In addition to the specific performance inadequacies identified in the PSAs the applicant had not met the employer’s annual performance expectations since 2011.

[48] Although the applicant complained that the particular sales targets figures that had been set for her were unrealistic and unreasonable, the applicant’s work performance was assessed upon a number of factors of which sales target achievement levels was but one component. Importantly, in addition to reaching 90% of sales target figures, the 2016 PSA required the applicant to undertake various activities which included, inter alia, the production of regular reports, the development of strategic planning documentation, and the construction and presentation of sales forecasting materials.

[49] Consequently, if the applicant had met all the other factors upon which her work performance was assessed, then she would have been in a strong position to challenge the legitimacy of the reason for her dismissal because the dismissal would have been solely based upon the failure to reach 90% of the established sales target figure. In such circumstances, if the applicant established that the 90% achievement of the sales target figure was an unreasonable requirement, then the failure to meet such an unreasonable requirement would not represent valid reason for dismissal.

[50] However, unfortunately for the applicant, the evidence has established that her performance failures were not confined to an underachievement of established sales target figures. Perhaps the most revealing account of the specific performance failures of the applicant in areas other than sales target figures achievement was obtained from the answers provided by Mr Moynahan when he was cross-examined on this question by Mr Rogers. The following extract from the transcript of proceedings is provided as an example:

“You’ve spoken at a level of some generality about those. What precisely was it that she wasn’t doing? --- She didn’t provide a weekly report.

Right? --- The territory plan was not done. When asked on I think formal request for the territory was about five or six. That was not completed. My future, so that’s just about leadership, how we actually improve. That was done with headlines - there was no content. The forecasting, there was no - I had no confidence in the information going to my superiors with the forecasting and information that she provided.” 2

[51] It is also relevant to recognise that the applicant was under no misapprehension as to the seriousness of the performance management processes that she was engaged in over an extended period of time. Further, it was clear that the applicant realised that failure to satisfactorily meet the requirements of the process could lead to the termination of her employment. The applicant provided the following confirmation of her level of understanding during cross-examination:

“Just in relation to performance management, did you understand the outcome of performance management might be the termination of your employment at some stage? --- Yes, it was quite clear within the Telstra culture anyone undergoing a performance managed process was really a way out to get rid of people, so, yes, I did understand it and I understood the seriousness of being on a performance managed or performance support agreement.” 3

[52] As the extended period of performance management entered into its final stages the applicant recognised that further underperformance would eventually generate a concluding scenario. The applicant’s appreciation for the imminent finalisation of the process was reflected in the opening sentences of her email to Mr Moynahan on 23 November 2016, when she stated:

“May I be given one last opportunity to provide you with my weekly reports & accurate sales against target before going ahead with what we discussed. Im [sic] confident I will achieve my sales target based on my addressable market.”

[53] In these circumstances, the applicant was clearly aware of the consequences that would likely follow from any failure to provide the report documentation, and even if the sales target figures were unreasonable, there was no conceivable explanation for the failure to meet the other requirements of the 2016 PSA involving for example, the provision of the weekly reporting documentation.

[54] In any event, the evidence has not established that the sales performance target figures were unreasonable or unrealistic. The applicant was provided with considerable assistance and training, and at her request the final sales target figures that were used in the 2016 PSA were adjusted so that they were more favourable to the applicant.

[55] During cross-examination, the applicant seemed to reluctantly accept that the sales target in the 2016 PSA had been adjusted for her benefit, and she acknowledged that she had reached only 73% as opposed to the target of 90% of the adjusted figure. The following extract from transcript provides an example of evidence that supports that the sales target figures were not unreasonable, but instead, were determined with some leniency and intent to assist the applicant achieve the target outcome:

“He measured me on a $9.5 million sales target, but the performance support agreement actually had a sales target of 6.5 that I was measured, which I achieved 73% of.

MR DARAMS: I want to suggest to you that in fact what Mr Moynahan did was reduce your sales target to assist you? --- It wasn’t reduced. It was actually a more accurate figure from - based on the $12.8 million customer portfolio, $6.5 million was more favourable to me. I had to accept that - - -” 4

[56] In addition to the reason for dismissal that was stated by Telstra and which concerned ongoing unsatisfactory employment, there was evidence of a conduct/behaviour issue which, although not raised by Telstra, has provided something of a supplementary or contextual foundation which would have understandably contributed to the decision to dismiss.

[57] There was some contested evidence about the details of the conversation that occurred during the meeting between the applicant and Mr Moynahan held on 23 November 2016. This was clearly a difficult meeting. Mr Moynahan advised the applicant that she was to be placed on a (second) formal PSA, and at some stage during the meeting the applicant became emotional.

[58] Mr Moynahan set out his recollection of certain details of the conversation that occurred during the meeting of 23 November 2016, at paragraph 52 of his witness statement. 5 The applicant’s statement in reply6 rejected particular aspects of the details of the conversation as provided by Mr Moynahan, for instance the applicant rejected that she had asked if she could be made redundant.7 However, the applicant confirmed that there had been discussion during the meeting about the applicant receiving a payment as basis for her resignation from employment with Telstra. The applicant said that, inter alia, she told Mr Moynahan: “The minimum I will accept is 12 months for the pain & suffering & loss of wages over the last 2 or so years.”8

[59] Further, the applicant did not dispute the following details of the conversation as recounted by Mr Moynahan:

“Ms Milonas stated that if I moved to formal performance management and ‘played that game’ that she could also play that game. She stated that [sic] words to the effect: I have a barrister standing by and the union is ready to go. I am happy to go through the courts, I’ll even make a call to Paul Clitheroe”. 9

[60] In the context of a conversation which involved the employer implementing a performance management process which was being opposed by the employee, and who then sought to negotiate payment as basis for resignation, the unambiguous threat to litigate and potentially provide adverse media publicity was not conduct that could be described as consistent with the continuation of the employment relationship. The threat to bring public disrepute to Telstra, in the context of the discussion that occurred on this occasion, may have been understandably considered as distasteful by a generous employer that accommodated the emotional state of the applicant. In different circumstances, another employer may have treated this threat as misconduct.

[61] In summary, an analysis of the various aspects of the ongoing unsatisfactory work performance of the applicant has established that there was valid reason for dismissal. A further examination of the evidence has not supported the challenge made to the alleged unreasonable sales target performance requirements that the applicant failed to achieve. Further, particular conduct on the part of the applicant was, at best, not conducive to the continuation of the employment relationship.

[62] Consequently, there was valid reason for the dismissal of the applicant related to the applicant’s capacity and conduct.

387 (b) - Notification of reason for dismissal

[63] The employer provided verbal advice of dismissal at the resumption of the 2016 PSA review meeting held on 23 March 2017. Shortly thereafter written notification of the reason for the applicant's dismissal was provided which included detailed aspects of the applicant’s underperformance.

387 (c) - Opportunity to respond to any reason related to capacity or conduct

[64] The evidence established that the applicant had been provided with an opportunity to respond to the performance inadequacies identified during the 2016 PSA review meeting. In particular, after there had been some detailed examination of the various aspects of the 2016 PSA, Mr Moynahan asked the applicant; “Anything else that you wanted to bring up?” 10 The applicant then provided various additional responses after which the meeting was briefly adjourned. It was clear that the responses provided by the applicant did not satisfy Mr Moynahan.

[65] The approach that the employer adopted for dealing with the circumstances that emerged during the 2016 PSA review meeting on 23 March 2017 must, on balance, attract some criticism. Telstra had implemented performance management processes for the applicant over a protracted period involving more than two years. There was a degree of undue haste in the manner in which the applicant was advised of her dismissal after the resumption of the meeting on 23 March.

[66] Consequently, Telstra could have provided the applicant with a more dignified and less perfunctory means by which it conveyed the decision to dismiss. At the resumption of the meeting the applicant could, and should, have been verbally advised that as a result of the identified outcomes of the 2016 PSA and having regard for the responses provided during the meeting by the applicant and her representatives, it nevertheless intended to implement dismissal. Telstra could, and should, have then provided written confirmation of its intention to dismiss, and granted the applicant what is understood to be a “show cause” process whereby any issues that the applicant wished to raise as a means to dissuade the employer from dismissal could be provided and then carefully examined before a final decision was confirmed.

387 (d) - Unreasonable refusal to allow a support person to assist

[67] There was no suggestion that the applicant was not offered the assistance of a support person during the various discussions that were held regarding her performance review processes. In particular, the applicant was assisted by a Union representative during the 2016 PSA review meeting held on 23 March 2017.

387 (e) - Warning about unsatisfactory performance

[68] In this instance where the applicant was dismissed for ongoing unsatisfactory work performance, there was ample evidence of warning to the applicant. The applicant had been provided with two formal written warnings. Further, the applicant gave evidence that she understood the seriousness of the performance management processes, and that she was engaged in a process that would potentially lead to the termination of her employment.

387 (f) - Size of enterprise likely to impact on procedures

[69] Telstra is a large business and the size of its operation would not have been likely to have significant impact on procedures surrounding the dismissal of the applicant.

387 (g) - Absence of management specialists or expertise likely to impact on procedures

[70] Telstra did have dedicated employee relations management specialists and there was evidence that these specialists were involved at various times during the performance management processes invoked for the applicant. Further, employment specialist staff were also involved in the 2016 PSA review meeting held on 23 March 2017, and the processes that lead to the dismissal of the applicant.

387 (h) - Other relevant matters

[71] The submissions made on behalf of the applicant asserted that the particular personal circumstances of the applicant rendered the dismissal to have been harsh. In particular, the extensive period of employment of over 22 years was said to be a significant factor which when combined with other personal circumstances of the applicant, rendered the dismissal to have been harsh.

[72] Any dismissal after an extensive period of service will usually create difficulties, particularly if the dismissed employee has limited scope for securing alternative employment. The extent to which other personal issues such as the employee’s level of indebtedness can properly contribute to a finding of harshness can present as questionable considerations. There are a variety of personal circumstances over which an employer would have no influence or control, and it would seem to be unreasonable to visit these circumstances detrimentally on the employer.

[73] In this instance, consideration of the personal circumstances of the applicant, in particular her extensive period of service with Telstra, has been balanced and evaluated together with all of the other relevant considerations. In particular, the personal circumstances of the applicant and the unfortunately perfunctory process adopted by Telstra during the 2016 PSA meeting, have been matters that have been given appropriate weight and balanced against, in particular, the valid reason for dismissal.

Conclusion

[74] The applicant was dismissed on 23 March 2017, during a meeting that was held to review a performance management process. The applicant had been the subject of a previous performance management process, and concerns regarding her underperformance had been the subject of protracted scrutiny. The applicant had been provided with two written warnings regarding her poor performance. The applicant was under no misunderstanding about the seriousness with which the employer was treating the performance management processes and that there was clear potential for termination of employment.

[75] During the meeting held on 23 March 2017, the applicant was provided with an opportunity to explain, rebut, challenge, or otherwise make out a defence regarding identified performance inadequacies. The responses provided by the applicant did not satisfy the employer. Upon analysis, the applicant clearly failed to undertake specific tasks, and she also failed to meet other stipulated performance requirements. These performance requirements including the sales targets figures were not unrealistic or unreasonable.

[76] Consequently, the employer dismissed the applicant for valid reason relating to the applicant's capacity and conduct.

[77] The verbal notification of dismissal of the applicant and other aspects of the procedure that Telstra adopted to deal with the dismissal contained certain unfortunate deficiencies. These deficiencies and other matters relating to the personal circumstances of the applicant have been carefully evaluated and assessed against the valid reason for dismissal.

[78] Therefore, having considered the various factors contained in s. 387 of the Act, the totality of the evidence presented in this instance when considered and balanced, has led to a conclusion that the applicant's dismissal was not harsh, unjust or unreasonable.

[79] Consequently, the application for unfair dismissal remedy must be dismissed and an Order to that effect will be issued accordingly.

COMMISSIONER

Appearances:

Mr T Rogers of Counsel appeared for the applicant.

Mr J Darams of Counsel with Mr H Small ofTelstra Corporation Limitedappeared for the employer.

Hearing details:

2017.

Sydney:

July, 24.

November, 6 & 7.

 1   Exhibit 11 – Attachment “VB-4”.

 2   Transcript @ PN1089 and PN1090.

 3   Transcript @ PN298.

 4   Transcript @ PN592 and PN593.

 5   Exhibit 9.

 6   Exhibit3.

 7   Exhibit 3 @ paragraph 354.

 8   Exhibit 3 @ paragraph 357.

 9   Exhibit 9 @ paragraph 52 (i).

 10   Exhibit 4 @ page 33.

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