Amber Aviation Academy Pty Ltd v Mr Dmitry Agarev

[2017] FWC 6160

[2017] FWC 6160

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.604 - Appeal of decisions

Amber Aviation Academy Pty Ltd
v
Mr Dmitry Agarev
(C2017/6247)

DEPUTY PRESIDENT COLMAN MELBOURNE, 24 NOVEMBER 2017

Appeal against decision [2017] FWC 5416 of Deputy President Gooley at Melbourne on 23 October 2017 in matter number U2017/6277 – stay of decision.

[1] This decision concerns an application for a stay order by Amber Aviation Academy Pty Ltd (Amber Aviation). The order is sought pursuant to s.606 of the Fair Work Act 2009 (the Act) in connection with an appeal it has lodged against a decision of Deputy President Gooley. In that decision, the Deputy President determined that Mr Dmitry Agarev had been unfairly dismissed by Amber Aviation, and ordered that compensation be paid to him in the amount of $3205.48 gross, and that $394.52 be paid into Mr Agarev’s superannuation fund, within 21 days.

[2] Section 606(1) of the Act provides as follows:

“Staying decisions that are appealed or reviewed

(1) If, under section 604 or 605, the FWC hears an appeal from, or conducts a review of, a decision, the FWC may (except as provided by subsection (3)) order that the operation of the whole or part of the decision be stayed, on any terms and conditions that the FWC considers appropriate, until a decision in relation to the appeal or review is made or the FWC makes a further order.”

[3] Amber Aviation seeks a stay of the whole of the order of Deputy President Gooley. The practical effect of a stay would be to suspend the obligation to pay the compensation until the appeal in this matter is determined.

Principles for staying the operation of a decision or order

[4] It is well established that, in deciding whether to exercise its discretion to grant a stay order, the Commission must first be satisfied that the appellant has an arguable case with some reasonable prospects of success, both in respect of permission to appeal and the substantive merits of the appeal. 1 In addition, the balance of convenience must weigh in favour of the order subject to appeal being stayed.2

[5] The principles applicable to the granting of a stay in the present case should be applied against the statutory framework that applies to appeals against unfair dismissal decisions. Unlike appeals against decisions made under other provisions of the Act, permission to appeal a decision under Part 3-2 (unfair dismissals) will only be granted if the Commission considers it to be in the public interest to do so. 3 Accordingly, there is a higher threshold that applies to an application for permission to appeal against an unfair dismissal decision.4

[6] Further, to the extent that an appeal against a decision made under Part 3-2 is on a question of fact, it can only be made on the ground that the relevant decision involved a significant error of fact. 5

[7] More generally, other errors said to have been made by the first instance decision-maker must be of a kind identified by the High Court in House v R. 6

Background

[8] Mr Agarev was employed by Amber Aviation from January 2016 until his summary dismissal on 5 June 2017, first as an instructor pilot and then in the position of Head of Aircraft Airworthiness and Maintenance Control.

[9] In May and early June 2017, Mr Agarev was involved in a number of incidents that were of concern to Mr Naidu, CEO of Amber Aviation.

[10] On 2 May 2017, Mr Agarev deleted from a whiteboard certain data relating to maintenance schedules and aircraft operations. Although he took a photograph of the board, the data was not readily available the next day when a CASA inspection took place. Mr Naidu asked Mr Agarev to provide him with an urgent written explanation and subsequently ‘recorded’ the incident as ‘leaving the aircraft status board blank and proceeding to change an approved system without formal change request or approval’. 7 However, Mr Naidu did not take any disciplinary action against Mr Agarev in relation to the matter (the ‘whiteboard incident’).

[11] Also on 2 May 2017, Mr Naidu and Mr Agarev had a discussion about redundancies. Mr Agarev says that Mr Naidu told him that he would be made redundant. Mr Naidu says he simply flagged the possibility of redundancy. In any event, it appears that one week later, Mr Agarev told a student that he was going to be made redundant. Mr Naidu considered this to be a breach of the confidentiality obligations in Mr Agarev’s contract of employment (‘the confidentiality incident’).

[12] On 15 May 2017, Mr Agarev was ill and obtained a medical certificate. He was absent for 5 days. According to the Company, regulations and policy required Mr Agarev to disclose the nature of his condition, but he did not do so (‘the sick leave incident’). Mr Naidu requested that Mr Agarev obtain clearance from a Designated Aviation Medical Examiner (DAME), which he did. Mr Naidu subsequently learnt that Mr Agarev had been suffering from stress at the time of his sick leave. Mr Naidu considered that Mr Agarev should have told the Company about his stress; had Mr Naidu known about it, he would not have assigned Mr Agarev to active flight duties.

[13] Then on the afternoon of 2 June 2017, Mr Agarev was booked to undertake a three hour training flight with a student. This required Mr Agarev to plan the flight such that the aeroplane would land at Essendon Airport at least 10 minutes before last light. Mr Agarev did not confirm the end of daylight in the plan. He ultimately had insufficient time to return to Essendon Airport before last light and was forced to land at another airport south west of Melbourne (‘the flight plan incident’).

[14] According to the Company, when the plane landed, it was discovered that it only had ten litres of fuel left, which is below the fuel reserves required by CASA regulations and company policy (‘the fuel incident’). Before the Deputy President Mr Agarev gave evidence, which was not challenged, that Mr Naidu instructed him and a Mr Rao to evaluate the fuelling system of the aircraft and that, when they did so, they found that the fuel gauge and dipsticks in the plane produced inaccurate readings.

[15] Mr Naidu met with Mr Agarev on 6 June 2017 to put to him the allegations about the breaches of policy arising from the flight plan incident and the fuel incident. Mr Naidu also put to Mr Agarev the allegation about breaching confidentiality, and a further allegation concerning deficiencies in student records. Most of the meeting was recorded. At the conclusion of the meeting, Mr Naidu stated there were ‘a number of things of great concern here’, and that he had to ensure that everyone operates with a ‘safety mandate’. He referred again to the confidentiality incident. He then summarily dismissed Mr Agarev.

The unfair dismissal proceedings and the decision

[16] The unfair dismissal proceedings before the Commission were conducted as a determinative conference.

[17] Mr Naidu gave evidence that no one incident caused him to dismiss Mr Agarev, but rather the series of incidents, which had led him to believe that there was a ‘trend developing’ in relation to Mr Agarev’s approach to safety. 8 The Deputy President found that the flight plan incident had involved a breach of company procedures, and that this incident was the core reason why the Company terminated Mr Agarev’s employment.9

[18] It was common ground that Amber Aviation was a small business for the purposes of the Act. As required by s.396, the Deputy President initially considered the jurisdictional question of whether the dismissal was consistent with the Small Business Fair Dismissal Code (Code).

[19] To comply with the Code in a summary dismissal setting, an employer must believe on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. The Deputy President was not satisfied that Mr Naidu held such a belief in relation to the flight plan incident, or any of the other individual incidents. 10 She further concluded that, taking all of the conduct together, Mr Naidu did not have reasonable grounds to believe that Mr Agarev’s conduct warranted summary dismissal. In particular, she did not consider that there was a reasonable basis for Mr Naidu to have formed the view that a trend was developing in Mr Agarev’s approach to safety.11 She concluded that the dismissal had therefore not been consistent with the Code.

[20] The Deputy President then proceeded to consider whether Mr Agarev had been unfairly dismissed, and took into account the considerations in s.387. She concluded that there was a valid reason for Mr Agarev’s dismissal, and made reference to the flight plan incident. However, she considered that his conduct did not warrant summary termination, as there was no evidence that his actions on that day had been wilful or deliberate, or that his conduct caused a serious and imminent risk to anyone’s health or safety, or the reputation, viability or profitability of the business. 12 She concluded that the dismissal of Mr Agarev without notice was harsh and awarded him the compensation referred to above.

Grounds of appeal

[21] The grounds of appeal are not matters that are to be determined in this stay application. Rather, the question to be determined is whether the order made by Deputy President Gooley should be stayed. The purpose of examining the grounds of appeal is to consider whether they disclose an arguable case of error, with some reasonable prospect of success on appeal.

[22] The Company’s notice of appeal refers to alleged errors of fact in the Deputy President’s decision. It contends that insufficient consideration was given to ‘safety matters’. In particular, it submits that the Company was not given an opportunity to provide information and evidence about Mr Agarev’s breach of CASA regulations and company policy.

[23] I cannot identify an arguable basis to suggest that the Company was not afforded an opportunity to provide information and evidence about safety matters. In particular, I note that the Company did not file a statement of evidence in advance of the hearing, as it was required to do by directions of the Commission. It was suggested at the stay hearing that, during the proceedings before the Deputy President, the Company wanted or needed to put on further evidence. However, no request for an adjournment was made to the Deputy President. Generally, the contention appears to be that the Company could have run a better case. However, this is not a basis on which to appeal a decision. Appeals are concerned with whether a decision is affected by error.

[24] The notice of appeal further contends that the fuel incident was particularly serious and that the aircraft would not have made it back to Essendon Airport with the fuel it had on board. However, the evidence before the Deputy President was that the readings were not accurate and the Company did not contradict this. It was therefore not established that Mr Agarev had insufficient fuel.

[25] A third contention in the notice of appeal is that proper consideration was not given to the seriousness of the whiteboard incident, in which Mr Agarev wiped important data from the board, knowing that CASA was visiting the next day, and then proceeding on 5 days of RDO’s. It is contended that this could have caused the grounding of the fleet, had it been seen by the FOI. However, in the termination meeting, Mr Naidu did not refer to the incident. Further, Mr Agarev did not receive a warning about it. Mr Naidu contests some of the factual findings that the Deputy President made about this incident. But considered in context, it does not appear likely that any alleged factual error could have been significant, as is necessary in order for the error to found an appeal ground in relation to an unfair dismissal decision.

[26] The notice of appeal also contends that Mr Agarev did not disclose that stress had been a cause of his sick leave; however this is a submission concerning Mr Agarev’s conduct, not a contention of error on the part of the Deputy President.

[27] The Deputy President found that there was no evidence of the flight plan incident causing a serious and imminent risk to anyone’s health and safety. In this regard, Mr Naidu did not contend before the Deputy President that there was a serious and imminent risk to safety. At the stay hearing, there was discussion as to whether the Deputy President should have found, on the evidence before her, that the flight plan incident did pose such a risk. However, in my view such a proposition would be difficult to make out, given Mr Naidu’s evidence that had Mr Agarev ‘been a junior grade 3 instructor … it would have been acceptable and they would have done remediation and worked with that instructor.’ 13 Clearly, the Company expected much better of Mr Agarev, given his seniority. But the flight plan incident does not appear to have posed a serious safety risk to Mr Agarev or others.

Conclusion

[28] Amber Aviation may be able to develop its various arguments on appeal. However, in the context of the higher threshold for permission to appeal and the requirement that any alleged errors of fact be significant, I am not presently satisfied that the Company has made out an arguable case, with some reasonable prospects of success as to the merit of an appeal or as to permission to appeal. It is therefore not necessary to consider the balance of convenience.

[29] Finally, I note that the Deputy President ordered the compensation to be paid to Mr Agarev within 21 days of her decision. That period expired on 13 November 2017. The appeal was filed the following day, outside the 21 day limit prescribed by the Commission’s rules. Whatever the reason for the late filing of the appeal, the Deputy President’s order has still not been complied with. The Commission ultimately has a discretion to as to whether to issue a stay under s.606(1). In my view, a party’s non-compliance with an order that it asks the Commission to stay would be a consideration telling against the exercise of the discretion.

[30] The application for a stay is dismissed.

DEPUTY PRESIDENT

Appearances:

C Larkins of the AFAP for Mr Agarev

R Sorensen of counsel for Amber Aviation Academy Pty Ltd

Hearing details:

2017

Melbourne

22 November

 1   Kellow-Falkiner Motors Pty Ltd v Edghill Print S2639, 24 January 2000 at [5]; applied in Bank of Sydney Ltd v Repici[2015] FWC 5511 et al.

 2   Ibid. See also Coal and Allied Operations Pty Limited v Crawford and Others (2001) 109 IR 409 at [13].

 3   Section 400(1) of the Act

 4   WorkPac Pty Ltd v Bambach (2012) 220 IR 313; FWAFB 3206 at 14.

 5   Section 400(2) of the Act

 6   House v R (1936) 55 CLR 499

 7   Paragraph 14 of the decision

 8   Paragraph 44 of the decision

 9   Paragraph 48 of the decision

 10   Paragraphs 50, 55

 11   Paragraph 58

 12   Paragraph 67

 13   Paragraph 48 of the decision; PN553

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