Amber McCormick v The Trustee for JJMP1 Trust
[2023] FWC 2843
•27 OCTOBER 2023
| [2023] FWC 2843 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Amber McCormick
v
The Trustee For JJMP1 Trust
(U2023/4384)
| COMMISSIONER SIMPSON | BRISBANE, 27 OCTOBER 2023 |
Application for an unfair dismissal remedy – Summary dismissal complied with Small Business Fair Dismissal Code – Application dismissed
On 20 May 2023, Ms Amber McCormick (Ms McCormick/the Applicant) applied to the Fair Work Commission (the Commission) under section 394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy, alleging she was unfairly dismissed from her employment with The Trustee for JJMP1 Trust (the Respondent).
I listed the matter for an initial directions hearing by telephone on 30 June 2023. The matter was listed for hearing of the jurisdictional issues and the merits of the application by video using Microsoft Teams on 18 August 2023.
At the commencement of the hearing, the parties agreed for the matter to be conducted as a determinative conference. Ms McCormick appeared on her own behalf, and Mr Colin Mitchell, Director, appeared with Ms Rosalind Mitchell for the Respondent.
Ms McCormick filed written submissions on 28 July 2023. Ms McCormick adopted this submission as her sworn evidence. Ms McCormick sought to rely on a statement of Ms Lioni Wilkinson, however Ms McCormick said she was unaware Ms Wilkinson would need to appear at the Hearing. The Respondent relied primarily on its Form F3 Response filed on 27 June 2023 which was prepared by both Mr and Ms Mitchell. Mr and Ms Mitchell both adopted the contents of what was said in the Form F3 as sworn evidence. They also both swore to the contents of what was said in the completed Fair Dismissal Code Checklist. They both said that the Checklist was prepared by both of them, although Mr Mitchell provided some clarification concerning what was said on part of the Checklist.
The Respondent also filed an email of 28 July which included reference to the following issues. Mr Mitchell said he drafted the email and adopted the contents of that email as his evidence.
“………………
1. 1. Sand for pool not removed ( sat 1 year on powered site )
2. 2. Lightening strike damages not actioned
3. 3. Termite spraying not actioned - lost cabin 13 to termites
4. 4. Missing equipment- bike, gerney
5. 5. Recycled cans : 4 square bins & 3 regular bins overflowing at camp kitchen not removed for
12 months6. 6. Staff said she did not come to the office for 3 weeks when she purchased her house..”
The Respondent filed a further email with attachments on 11 August 2023 that Mr Mitchell also adopted as evidence. Thie email included the following in relation to the allegation of funds going missing:
“Please see the attached statements, in response to section 3 of the ASCListing letter, as the cash misconduct evidence we have.
1. CamCupid, tennant in Van12, RMS statement showing missing payments. The Tennant has confirmed that all payments where made using cash or card. Only the card payments have been recorded in our RMS booking system.
2. Statements showing monthly cash receipts Feb23, Jan23, Mar23 and Feb22. In Feb23 only $174 was recorded vs between $1000 and $4000 during the other months.”
The Respondent raised a jurisdictional objection that it was a small business and it complied with the Small Business Fair Dismissal Code.
Was the Applicant terminated?
The Applicant identified in her written materials that she had resigned from her employment with the Respondent, but that she considered she had no choice but to do so. This created a separate jurisdictional issue as to whether the Applicant was dismissed in accordance with s.386 of the Act.
Legislation
Section 386 of the Act sets out when a person has been dismissed from their employment and relevantly states:
“386 Meaning of dismissed
(1) A person has been dismissed if:
(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or
(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.”
Section 388 of the Act states:
“388 The Small Business Fair Dismissal Code
(1) The Minister may, by legislative instrument, declare a Small Business Fair Dismissal Code.
(2) A person’s dismissal was consistent with the Small Business Fair Dismissal Code if:
(a) immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened first), the person’s employer was a small business employer; and
(b) the employer complied with the Small Business Fair Dismissal Code in relation to the dismissal.”
The Small Business Fair Dismissal Code states:
“Summary Dismissal
It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.
Other Dismissal
In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.
The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.
The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.
Procedural Matters
In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.
A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.”
In this matter, I am first required to determine if Ms McCormick was dismissed pursuant to s.386 of the Act. If I find that Ms McCormick was not dismissed pursuant to s.386 of the Act, the application will be dismissed. If I find that she was dismissed, then it is necessary to determine if the dismissal was in accordance with the Code.
If I determine Ms McCormick’s dismissal was not in accordance with the Code, it is necessary for me then to determine if the dismissal was harsh, unjust or unreasonable pursuant to s.387 of the Act, which states:
“387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:
(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 the 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.”
Background
The Applicant had been employed by the Respondent to manage the Kookaburra Holiday Park in Cardwell, North Queensland. At the time of termination, the Applicant was receiving remuneration at $94,500 per annum inclusive of superannuation.
The parties described a sequence of events leading to the ending of the employment relationship included the following events.
19 March 2023
Ms McCormick said she had a discussion with Mr Mitchell on 19 March 2023 for an hour and a half and it was agreed she could send a park map to the local council.
20 March 2023
Ms McCormick said on 20 March she sent an email to the Council Environment Health Officer and within 20 minutes Mr Mitchell had called her and was verbally abusing her.
21 March 2023
On 21 March 2023, Ms McCormick stated that she found her role with the Respondent advertised online. Ms McCormick said the following day on 21 March 2023 she saw on Facebook that her job was advertised. Mr Mitchell said he did not recall exactly when the job was advertised. Mr Mitchell said they live in regional Victoria and their manager Ms McCormick lives in North Queensland running the park, and they were getting big alarm bells ringing with Ms McCormick not answering calls, and not answering customers calls and customers were telling them there were a lot of things wrong and they were not staying at the park because of the condition of the park, and they felt they were in a very precarious position.
Mr Mitchell said they tried two things, one to try and find a way to get Ms McCormick to do the things she was refusing to do, and second as a backup, to get an advertisement out to try and find an alternative manager if the worst comes to the worst, which subsequently happened.
22 March 2023
Ms McCormick said the following day being 22 March 2023, Mr Mitchell sent her an email that included a statement to the effect that following recent events it was clear she no longer wanted to do the job, that it was hoped she would work for them in the future, however that if she continued her non cooperative stance she would need to be terminated.
On 22 March 2023, Mr Mitchell raised several concerns with Ms McCormick by way of text message in relation to the performance of her duties in her role as the Manager of the Park. Among Mr Mitchell’s allegations were that Ms McCormick did not answer telephone calls, refused to manage permanent tenants and backpackers, and did not assist in dealing with a tenant’s deceased estate. Mr Mitchell described Ms McCormick’s conduct as “serious misconduct or wilful neglect in [her] employment duties”. Mr Mitchell said Ms McCormick would respond on google chat. Mr Mitchell said they just wanted to talk to Ms McCormick about problems they were having to try and fix them.
Ms McCormick said that Mr Mitchell had said to her to transfer the phones to him so she could respond to him, however Ms McCormick said she was in the office dealing with customers. Ms McCormick said she did transfer the phones to him and started working on an email to respond to issues but it didn’t stop the fact that she was still at work and face to face customers.
23 March 2023
On 23 March 2023, Ms McCormick responded to the concerns raised by the owners in an email addressed to Mr Mitchell. Ms McCormick rejected many of Mr Mitchell’s allegations regarding the non-performance of her duties, and provided examples of the various actions of tenants that disrupted the operations of the Park and posed a risk to her safety. Ms McCormick denied that she was telling staff not to listen to him.
Mr Mitchell gave examples where he said that a person had died in the park and he needed to put together documentation associated with that, including a picture of the car, and he just asked for someone to take a picture and Ms McCormick refused. Mr Mitchell said he then called ‘Leone’, a cleaner to take the picture and ‘Leone’ also refused. Mr Mitchell said he surmised that this would have been because ‘Leone’ did not want to cross Ms McCormick. Mr Mitchell provided another example of when they wanted to put new cabins in the park and they needed a picture of one of the villas because he wanted to get quotes for more of the same. Mr Mitchell said that again Ms McCormick just refused to do it. Mr Mitchell said again when he asked the other staff to do it they just said no. Mr Mitchell said he inferred that was either intentional refusal to do it, or the other staff had discussions with Ms McCormick about the topics and were sympathetic to Ms McCormick and that is why the request was refused.
24 March 2023
Mr Mitchell responded to Ms McCormick’s email, in an email sent to Ms McCormick at 8:51am on 24 March 2023, claiming that disruptive tenants had been removed, and asking whether Ms McCormick intended to carry out certain duties associated with her employment. Ms McCormick replied on the same day, at 3:53pm, refuting Mr Mitchell’s suggestions that all disruptive tenants had been removed. Ms McCormick stated that she felt the Respondent was not treating her safety concerns seriously. The final paragraph of her response stated as follows:
“I’m still at work and don’t know whether or not to keep working. Do you still want me to continue working at this time despite your allegations of serious misconduct or wilful neglect”.
Mr Mitchell responded at 5:28pm, stating:
“Dear Amber
Your welfare and safety is way more important than anything work related. I would like to keep working.
We do need to talk about the items you are refusing to do and find a solution or the…business will simply fail.
Regards
Colin”
The Respondent submitted that Ms McCormick did not respond to Mr Mitchell’s communication nor address the concerns he raised with her. On 26 March 2023, Mr Mitchell sent the following message to Ms McCormick:
“Hi Amber, we can’t resolve this together if you don’t answer my calls.
Not responding to my questions means that I must assume that your answers have not changed from no.
If you continue like this then you giving me no option other than to find someone else to resolve this.”
29 March 2023
Ms McCormick provided evidence of a text message exchange with Mr Mitchell from 29 March 2023, in which Mr Mitchell stated that the Respondent could only address current concerns with backpacker behaviour. In response, Ms McCormick stated that her concerns were current. She submitted that she had reported concerns as they arose, but that Mr Mitchell refused to acknowledge this.
30 March – 5 April 2023
Ms McCormick took a week of personal leave from 30 March 2023 to 5 April 2023.
21 April 2023
Ms McCormick said a day or two before 21 April 2023 she sent Mr Mitchell and Ms Mitchell a screen shot of some death threats against herself and her daughter. Ms McCormick said on 21 April 2023 Mr Mitchell told her to report the death threats to the police, and Mr Mitchell said to her that he takes the threats seriously and genuinely cared about her and her daughter’s safety and he wanted to let her know that he had reported it to the police at 10.30am that morning. Mr Mitchell said that the police would get in contact with her and Ms Mitchell will be flying up to support her. Mr and Ms Mitchell both agreed this had occurred and that the police had advised them to tell Ms McCormick that she needed to report it herself.
Ms McCormick said the police attended the park on 21 April 2023 because Mr or Ms Mitchell had contacted them. Ms McCormick said she received a message saying take a couple of days off.
I asked Ms Mitchell if the death threat was the reason for her travel and Mr and Ms Mitchell’s evidence was to the effect that there were a number of reasons including that.
23 April 2023
Ms Mitchell said as they live 5 hours outside Melbourne, it takes 2 days to travel up and just before she left, they stood down Ms McCormick and phone calls were redirected to Mr Mitchell, and other staff were working on the weekend. Ms McCormick said she was confused, and she was told to take the next 2 days off and think about whether she wanted the job. There was a text message on 23 April from Mr Mitchell to Ms McCormick that included the following:
“You’ve been off your normal duty since Friday to think about this. Please take today and Monday off as well in order to think about and compile your response. Will organise the meeting on Tuesday or Wednesday to discuss this face to face.”
The evidence is that Ms McCormick was paid for the four days that she did not work during this period.
24 April 2023
On 24 April 2023, Ms McCormick sent an email at 8.08pm to Mr Mitchell, which stated:
“Hi Colin,
Please accept this email as notice of resignation.
Regards
Amber McCormick”
Ms Mitchell said she flew up from Victoria and arrived on 24 April 2023 and the resignation was sent around the same time she arrived.
Ms McCormick agreed that she did not intend to resign on 24 April with immediate effect and that she was intending to give notice of her intention to resign in accordance with notice period of three months in her contract of employment. Ms McCormick said after events of 21 April 2023 and prior events, she decided resigning was the best way forward and it was the most fair on both parties, as the owners had time to find a new manager, and she would have time to find a new place to live. Ms McCormick said she was concerned that her daughter was affected being unsure of whether they had certainty or would have to move at short notice.
25 April 2023
Mr Mitchell responded on 25 April 2023 at 10.18pm as follows:
“Hi Amber
Your resignation is accepted and we’ll waive the notice period.
Let’s discuss the way forward tomorrow. I hope that you and Tiarna will still join us on the Gold Coast and that you will consider managing a tourist park near Harvey Bay if we purchase one in the future.
Best Wishes
Colin & Ros”
Mr Mitchell said during his oral evidence that Ms Mitchell had ticked yes, in answer to question 10 on the Checklist where it says “Did the employee voluntarily resign or abandon his or her employment?, and had also written “Resignation was received on 24 April after she was stood down on 21 April due to refusal to communicate and attend to major parts of her job”.
Mr Mitchell said that he was under the impression that the resignation was waiving the notice period, and that was the condition he said he accepted it. Mr Mitchell said subsequently they decided on the basis of more information that came through, that it was a lot more serious than they thought, and there were allegations of funds going missing, and they found additional information on breaches with Council, and on the back of everything else that had happened, Mr Mitchell said they decided it was better to formally dismiss Ms McCormick immediately under clause 9.5 of her employment contract.
26 April 2023
Ms Mitchell said there were two telephone calls with Ms McCormick after she had put in her resignation. In one call, after the tender of the resignation Ms Mitchell said that Ms McCormick told her that her resignation was not intended to have immediate effect, and Ms Mitchell said the response from the employer was, “okay we will go back to the drawing board and let you know what is happening.” Ms McCormick’s evidence at the hearing was that she was in no position to leave with immediate effect. Ms McCormick said that Ms Mitchell said they needed to get some new managers in, and she needed to speak to Mr Mitchell. Ms Mitchell said once she understood that Ms McCormick did not intend to resign with immediate effect, she knew they would need to get further advice.
The notice period under the employment contract is reasonably lengthy at three months in accordance with clause 9.1 of the employment contract. Ms McCormick said that was what she discussed with Ms Mitchell on 26 April, and they had discussed negotiating the notice period, and Ms McCormick said Ms Mitchell would get back to her. Ms Mitchell said a second meeting was organised to discuss the issues found when she arrived on site.
27 April 2023
Mr Mitchell sent a subsequent email to Ms McCormick on 27 April 2023, which stated:
“Dear Amber
We need to postpone your resignation acceptance due to new information that has come to light. We need to discuss the following items before we can make an informed decision on your resignation and notice period:
1. Has the Guest in Van 13 being paying rent every week since Dec?
2. Has the pool testing log been kept updated?
3. Is the $174 cash recorded in RMS in Feb 23 correct as every other month ranges between $1200 and $6000 and Feb 22 was $300.
4. Has council requested an immediate fix on the broken panels of the pool fence?
Please take another day off to compile your response and attend a meeting at 5:45pm in the Office on Friday 28 Apr. If you don’t attend (by phone should be ok) a decision will be made in your absence.
Regards
Colin”
28 April 2023
Ms McCormick stated on 28 April 2023, she discovered that she was unable to access emails and financial and banking records. Accordingly, she argued that she was unable to respond to the Respondent’s accusations of theft that followed.
29 April 2023
On 29 April 2023, the Respondent issued Ms McCormick with a termination letter, advising that her employment contract was terminated with immediate effect. The termination letter reads as follows:
“We’ve given you an opportunity to respond to our concerns first raised with you on 24 Mar. You did not provide an acceptable response and instead chose to be argumentative and obstructive.
You are not carrying out your duties, you refuse to follow our direct instructions and don’t answer our calls and after-hours customers calls. Our business relationship has broken down to the extent that we have no trust or confidence in you to continue representing the Kookaburra Holiday Park, so your resignation is not accepted as we are immediately terminating your contract.
You’ve engaged in serious misconduct by refusing to work with tenants and backpackers, not answering calls, not cleaning the backpacker area after Seafarms resulting in a council non-conformance, not maintaining the gardens, not following direct managerial instructions and coercing staff not to follow owner instructions. This has brought the park into disrepute and resulted in financial losses of more than $100,000.
Consequently, we have no alternative but to terminate your employment immediately as per Section 9.5 of your employment contract. You are directed to not act in any capacity for the Kookaburra Holiday Park, and your services are terminated upon receipt of this advice. Your final payment, including your remaining annual leave, will be calculated to 29 April.
Legally you needed to vacate the house and returned all company property in your possession on 29 April and are directed to immediately hand over keys, credit cards and all company equipment in your possession. Please drop these off in the key box outside reception.
We will, however, allow you to stay free of charge in the house until 24 May. Once keys, credit cards and all company equipment in your possession are received, you will also receive two weeks’ pay.”
Was the Applicant dismissed?
Ms McCormick argued that the end of the employment relationship was not by resignation, and if it was a resignation then the Respondent’s course of conduct was such that she was constructively dismissed. Ms McCormick submitted that the advertisement of her job by the Respondent, along with threats and accusations made by Mr Mitchell, and an unreasonable workload created an “intolerable and untenable environment” such that she had “no choice but to resign”.
It is apparent on the basis of the evidence that neither the Applicant or Respondent intended for the employment to end with immediate effect, and for the three-month notice period to be paid in lieu of notice. The Applicant’s proposal was to give notice of a resignation under the contract which is a period of three months, and she intended to work the notice period. The Response from Mr Mitchell misconstrued Ms McCormick’s email, and I have concluded to accept Mr Mitchell’s evidence, that it was his intention in his email reply to accept Ms McCormick’s offer to resign on the basis no notice in lieu would be paid. Despite Mr Mitchell using the expression “waive the notice period”, which is commonly understood to mean notice will be paid and the notice period is not required to be worked, it is clear from the evidence he was intending to accept the resignation on the basis that the notice period would not be worked or paid, and it was that understanding of what he believed was being agreed to, that would be discussed the following day.
It is clear there was no meeting of the minds about the notice period, and on that basis, I have concluded that the employment did not end at the initiative of Ms McCormick, and instead ended at the initiative of the Respondent by the termination letter on 29 April 2023. On that basis it is unnecessary to consider the Applicant’s submissions concerning constructive dismissal.
Did the Respondent satisfy the Small Business Fair Dismissal Code?
Missing Money
The Respondent submitted that it complied with the Small Business Fair Dismissal Code in dismissing the Applicant. It was stated that Ms McCormick was dismissed because the Respondent believed, on reasonable grounds, that the Applicant had engaged in serious misconduct in the form of theft and serious breaches of occupational health and safety procedures. The Respondent also submitted that the Applicant committed serious misconduct in the form of “wilful neglect of her duties”. Furthermore, the Respondent stated that it dismissed Ms McCormick due to unsatisfactory conduct, performance or capacity.
Van 13 Cam Cupitt
The Respondent argued that it had reasonable grounds to believe Ms McCormick engaged in theft. The Respondent submitted a payment summary in relation to one of its long-term clients, Mr Cam Cupitt, which demonstrated several periods in which payment had not been recorded for the client. The Respondent stated that Mr Cupitt had informed Mr and Ms Mitchell that he had continuously paid for his accommodation in Van 13. Although there were intermittent periods where Mr Cupitt was absent from the park, the Respondent said that Mr Cupitt understood that the property was being rented for the duration of his total stay, and that payment was therefore required during brief absences. Given the anomalies in the payment summary, the Respondent stated it formed a view that Ms McCormick had been keeping missing payments for herself.
Mr Mitchell said they interviewed the resident in Van 13 and he said he had been making continuous payments. Ms Mitchell said that when they spoke to Mr Cupitt, he confirmed that he hadn’t moved out, and that his furniture had been there of all of time, and he rented it for the whole time and he told Mr and Ms Mitchell that he paid rent for the whole time. However, the booking records show periods when he wasn’t paying, and there was not even a record of a booking in the records.
Ms McCormick said in response that Mr Cupitt was not a tenant he was a customer. Ms Mitchell said the other receptionist ‘Patti’ also said to them that Mr Cupitt was renting his site for the whole time and that was her understanding and Mr Cupitt’s. Ms Mitchell said that ‘Patti’ had told them that Ms McCormick had told Mr Cupitt he didn’t have to pay when he wasn’t staying at the park.
Ms McCormick said that other customers also came and went and paid when they were on site. Ms Mitchell said the staff were told to go in and clean the Van 13 site every week, and that is not a service they would offer if he wasn’t a tenant. Ms McCormick said they didn’t always know when he would be there so they would clean his van after he departed and that is how they did it for all guests. Ms McCormick also said it was not always her that was in the office. Ms McCormick stated that it was her understanding that Mr Cupitt was not required to pay for periods in which he was not residing at the park. She stated that her recollection was that Mr Cupitt always paid as required and that she had no concerns with him as a client.Ms Mitchell said she understood the shortfall between the amount shown as paid by Mr Cupitt and the amount that would have been shown in the records if it was recorded as paid continuously was in the order of $1000 to $1500.
Very low cash intake in February 2023
In further support of its allegations concerning missing money, the Respondent identified anomalies in its cash intake records. The Respondent provided cash transaction reports that showed its cash intake for February 2023 was $174.00. Reports from January 2023 and March 2023 indicated a cash intake of $1,429.00 and $1,221.98, while the report from February 2022 indicated an intake of $3,879.00. The Respondent also referred to an incident involving a client who had made a booking with the park using Booking.com. It was argued that the client informed the Respondent that they had made a cash payment, but that this payment was not recorded in the system, and that Ms McCormick was the only person trained to perform office duties.
Mr Mitchell said it also made no sense that so little cash was taken in the month of February 2023. Ms Mitchell said that every month the Respondent takes 4 to 5% of its sales in cash, and in February 2023 they only took 0.5% of sales in cash, and the percentage of sales in cash, and the percentage of cash receipted was so low, that it appeared money was taken and not entered into the system.
Ms McCormick said this issue is difficult, and she could see only $174 was recorded for February however it was difficult for her to give an answer on what the cause of this was because she was cut out of the system. Ms McCormick said every three months Ms Mitchell and herself would meet up and go through transactions for the Business Activity Statement (BAS), however this time was different, and she was cut out of the system. Ms McCormick said one tenant had learnt to use internet banking, another had gone to New Zealand, and she would have liked to have looked into this. Ms McCormick disputed cash was even missing, and said it could have been explained if she had a chance to investigate. Ms McCormick also refuted the Respondent’s assertion that only her and another employee were trained to perform office work and access the Respondent’s booking systems. Ms McCormick argued that a number of other employees had access to the systems, but that Mr Mitchell did not question any other employee about the alleged theft. Ms McCormick submitted that the Respondent had not properly investigated the matter, nor allowed her an appropriate opportunity to respond.
Ms Mitchell responded that because it is a normal part of the business that a certain amount of cash was received each month, it raised serious concerns. Ms Mitchell said she did know that Ms McCormick was purchasing a property that month and the office was rarely opened. Ms Mitchell said that it was difficult for the other staff. Ms Mitchell said that Ms McCormick was always at the premises as she lives upstairs at the office, however she said it was normal for the office to be closed at different times such as doing things out of on the grounds like mowing, or repairing taps or putting silicon in showers. Ms Mitchell said that in the two months Ms McCormick was purchasing a property of her own, there were a lot of times that she was doing things other than then working in the business.
Missing Booking.com payment
Mr Mitchell said they also followed up with Booking.com the booking that hadn’t been paid and called to ask the person why they hadn’t paid for the booking. Mr Mitchell said the person came back to them and said they paid in cash, in which case there was a situation where a cash payment had not been recorded in the system. Ms Mitchell said when she arrived on site, she ran the debtor’s ledger which shows all the bookings where payments haven’t been made. Ms Mitchell said this particular one stood out to her because she did ring the client and the client said that she handed cash to a young lady and she remembered it because it was the first night of her big trip. Ms Mitchell said however this was not the only one that wasn’t paid, and there were numerous other bookings that weren’t paid, and she has just had to write them off. Ms Mitchell said she did not have evidence on them but there was at least a dozen more that were in a similar pattern where there was no payment recorded when people had stayed there.
Ms McCormick said it is very difficult for her to respond when no details were given, such as the date of the name of the customer or the amount. No details were given other than that it was booking.com. Mr Mitchell said Ms McCormick was the only young person that they could have been referring to, and it wasn’t only this one, but there were others.
Occupational Health and Safety
The Respondent submitted that Ms McCormick also committed serious breaches of occupational health and safety procedures by failing to clean the hostel kitchen and failing to maintain the swimming pool and records relating to the pool. It was contended that the hostel kitchen had not been cleaned since its last use in January or February 2023, which led to an assessment by the Council that it was non-compliant with hygiene standards. The Respondent also argued that Ms McCormick failed to maintain swimming pool records and failed to action an urgent request received from the council to repair the pool fence.
Ms McCormick denied that the hostel kitchen area had not been cleaned since January or February of 2023 and was in poor condition. She stated that in February 2023, she and other employees thoroughly cleaned the hostel area of the park and that Mr Mitchell was informed of the work that had been completed. Ms McCormick argued that the Council inspection of the kitchen area was conducted while work was being completed on the area, meaning the kitchen was not yet of a compliant standard. The Applicant provided evidence that, despite this, the Council report indicated that the Park was “overall in good condition”, and that she had been congratulated by Mr Mitchell for her efforts in maintaining the Park.
Ms McCormick said that Mr Mitchell contacted her saying he had just found out that the council had issued a non-compliance for the hostel, and none of the back packers had been cleaned and the kitchen was filthy. Ms McCormick said they had just done a deep clean of all of the park, and all the rooms had been done, and due to the wet season, it takes a bit longer. Ms McCormick said the kitchen had been done partially but it hadn’t been completed and she hadn’t painted in that area yet. Ms McCormick said that Mr Mitchell had cut the staff numbers down, and all she needed was to be allowed to keep doing what she was doing. Mr Mitchell said this all happened in January 2023, when the back packers area had been let out to a company called Seafarms and normally after guests have been in the area it is cleaned up straight away. Mr Mitchell said that the conversation he had with Ms McCormick about staffing reduction did not happen until February 2023.
Ms McCormick rejected the Respondent’s argument that the swimming pool records were not maintained and an urgent council request to repair the pool fence was not actioned. Ms McCormick referred to the Council inspection report, which confirmed that the swimming pool maintenance records were compliant. She also submitted that the request to repair the fence was made by the pool safety inspector (and not the Council) on 12 January 2023 and that the relevant repair was completed by the following day. Ms McCormick then referred to an email from the pool safety inspector which confirmed that the fence was suitable and provided the Pool Safety Certificate, dated 13 January 2023.
Mr Mitchell said when he got to site after Ms McCormick had left, he found an entire panel of rotten fence posts that a child could easily have crawled under, and so he got a maintenance person to fix it. Mr Mitchell said the fence was in a state of serious neglect, there were holes in it, and it needed to be fixed.
Neglect of Duties
Finally, the Respondent submitted that Ms McCormick wilfully neglected and refused to carry out her duties. The Respondent stated that Ms McCormick was warned several times in relation to these issues and given a number of opportunities to respond but failed to respond and failed to rectify the concerns. The Respondent submitted that Ms McCormick failed to:
“• Manage existing Tenants;
· Manage or engage backpackers;
· Follow direct managerial instructions and encouraged staff not to respond as well;
· Talk to the owners since the show cause process was started in March;
· Answer customer calls after 6pm or at all after March;
· Reasonably maintain the Gardens (Guests reported knee-high grass and unkept and overgrown gardens). Palm fronds were piled up to 2 metres high across three caravan sites;
· Implement any COVID regulations;
· Do daily booking reconciliations;
· Arrange repairs for simple items, like faulty smoke detectors, and instead blocked out these rooms resulting in several weeks of list revenue;
· Reset tripped circuit breakers in the Office, resulting in unnecessary Electrician callout fees”.
The Respondent submitted that the Applicant’s neglect resulted in $100,000 of lost revenue for the Respondent as compared to the previous year.
1. Alleged failure to manage existing Tenants.
In relation to the first dot point Mr Mitchell said the Respondent had about 10 permanent tenants when they started, and they are now down to 5 or 6. Mr Mitchell said Ms McCormick had managed about half of the tenants out, and for good reason that they were misbehaving, and given multiple warnings. Mr Mitchell said the problem was the Respondent lost half its revenue from the tenants and Mr Mitchell claimed that’s Ms McCormick said to him that she refused to put in new tenants, and it was something she was no longer prepared to do and Mr Mitchell had to do it. Ms McCormick said to Mr Mitchell she would no longer deal with tenants that were a risk to her safety. Ms McCormick said she was still dealing with some tenants who she got on well with, but there were a couple where there was serious issues and it got to the point where her safety was at risk, and she was not prepared to do that.
2. Alleged failure to manage or engage backpackers.
In relation to the second dot point, Mr Mitchell explained that when the business was acquired it had three income streams; permanent tenants, tourists, and backpackers. Mr Mitchell said when they acquired the business during the Covid 19 epidemic there no backpackers around. Ms Mitchell clarified that this was referring to European backpackers. Mr Mitchell said an interim solution to this was to put Sea Farms workers from Vanuatu into the backpackers, and there were a handful staying there. Mr Mitchell said there were some complaints about the behaviour of this group and they were asked to leave. He said when the Covid 19 epidemic ended enquires were coming in from backpacker groups and backpacker organisations, and they needed co-ordination with farms to place these backpackers into jobs. Mr Mitchell said this was always intended to be part of her role, and Ms McCormick just refused to do that work.
In response to the Respondent’s claims that Ms McCormick did not manage tenants and backpackers, Ms McCormick stated that she attempted to manage customers to the best of her ability but had difficulty doing so at times due to safety concerns. Ms McCormick said there was some trouble with Sea Farms workers however the company was very good to deal with, and a whole group was not thrown out however she did ban one person. Ms McCormick said she gave one example of an incident where she had to get up at 4am in the morning to deal with an incident, and the Police came and advised her it was not safe for her to be doing this, and they would handle such issues in the future. She stated that she did not receive training in relation to the management of tenancies and was instead instructed to seek external assistance. Ms McCormick further stated that she successfully managed behavioural issues relating to backpackers throughout 2022. She stated she raised concerns about the management of backpackers for 2023, but that these concerns were either not acknowledged or dismissed by Mr Mitchell. Ms McCormick said that she did look after backpackers. Ms Mitchell said that when she took over the phones at a time when Ms McCormick was sick, they were receiving 5 to 10 enquiries from backpackers a day and they were trying to get Ms McCormick to get the backpacker area ready for this demand and they could not get her to do it. Ms McCormick said she did raise the issue of not having vehicles to transport backpacker workers. Ms Mitchell said 25% of backpackers have their own transport and Ms McCormick was just telling backpackers who enquired about staying that the backpacker area was closed. Ms Mitchell said Ms McCormick must have been getting phone calls from backpackers because as soon as she took the phones over from Ms McCormick she was getting 10 phone calls a day from backpackers.
Ms McCormick also said one of the banana farms closed down and another farm was providing dongas on site. Mr Mitchell said these issues were challenges however Ms McCormick just didn’t want to deal with it.
3. Alleged failure to follow direct managerial instructions and encouraging staff not to respond as well.
In relation to the third dot point Ms McCormick denied she had encouraged staff not to respond to Mr Mitchell. Ms Mitchell claimed that one of the staff sent photos to them of a cabin they had requested, after Ms McCormick had not done so after being asked to do this by Mr Mitchell for two weeks. Ms Mitchell said that another staff member, ‘Patti’, sent the photos from the work email address, and then went and deleted the email sent. Ms Mitchell inferred that ‘Patti’ did this for fear of repercussions from Ms McCormick if Ms McCormick found out that ‘Patti’ had been assisting Mr and Ms Mitchell. Ms McCormick said she had never heard this allegation before, and she had a good relationship with ‘Patti’, and ‘Patti’ would have had no reason to fear any repercussion from her. Mr Mitchell also claimed that Ms McCormick had dismissed other staff who had cooperated with Mr Mitchell by providing requested information. Mr Mitchell identified Mr Peter Burrows, the husband of ‘Patti’ as an example, and he was dismissed the day after he assisted Mr Mitchell. Ms McCormick denied this saying Mr Burrows was not dismissed, and said he got a job in Tully. Mr Mitchell said in response that he received an SMS message from Mr Burrows telling Mr Mitchell he had just been terminated by Ms McCormick.
4. Alleged failure to talk to the owners since the show cause process was started in March.
In relation to the fourth dot point, Ms McCormick denied the Respondent’s contentions that she had not engaged with the owners since March 2023.
5. Alleged failure to answer customer calls after 6pm or at all after March.
Mr Mitchell said the issue with the fifth dot point concerning answering calls after 6pm, or at all after March 2023, was that 80% of the revenue comes via phone calls, and if the phone is not answered they will just call the next company. Mr Mitchell said aside from himself and Ms Mitchell calling, and the phone not being answered, he would call from anonymous numbers as well, and he found out that the phone calls were just not being answered and this was a direct loss of revenue. Mr Mitchell said there is a facility to leave a message however generally customers need an answer as they are driving past, and do not leave a message. He said if the phone is not answered they just call the next place. Ms Mitchell said the phone can be diverted to a mobile, but Ms McCormick would leave it in the office.
Ms McCormick submitted that she was always available by telephone for customer emergencies arising outside of business hours. She stated that she disputed with Mr Mitchell an expectation that she be always available to respond to customer bookings, despite her employment contract stating that the office closed at 6:00pm. She also stated that Mr Mitchell failed to consider her family responsibilities in seeking to impose this requirement. Ms McCormick said that when the phone was diverted to a mobile, she carried that mobile phone with her at all times when she was on the grounds or working. Ms McCormick said the phone did get answered. Ms McCormick said there would be an occasion where she might be on a ride on mower or up a ladder repairing something where the phone did not get answered right away and she would get back to them if a message was left. Ms McCormick said that they were in Victoria and couldn’t know if she left the phone in the office. Ms Mitchell responded that both Ms McCormick and ‘Patti’ had told them that Ms McCormick left the mobile in the office after 6pm. Ms McCormick said she left the work mobile in the office, as the phone were diverted to her personal mobile phone which she had with her upstairs after hours. Ms McCormick said she found it easier to use her personal phone as it was linked to the work emails, whereas the work mobile was just on a sim card.
6. Alleged failure to reasonably maintain the gardens (guests reported knee-high grass and unkept and overgrown gardens). Palm fronds piled up to 2 metres high across three caravan sites.
In relation to dot point 6 it was said by the Respondent that guests reported knee high grass, and unkept and overgrown gardens and palm fronds piled two metres high across three caravan sites. Mr Mitchell said once Ms Mitchell got to the site, they had to hire a guy with a truck and a guy with a bobcat to clear the three sites with palm fronds piled metres high, meaning those sites couldn’t be rented out or produce income, and also it looked really unkept and the park was in a really bad way. Mr Mitchell said in relation to the grass issue he had people call him and tell him they would have checked into the park, however when they saw how completely overgrown and unkept it was they didn’t. Ms McCormick denied that she did not reasonably maintain the gardens. She provided evidence of a post from the park Facebook page on 27 March 2023 in relation to garden work that had been undertaken.
Mr Mitchell said the other issue in relation to this matter was that the pool was renovated about a year ago and there was a pile of sand on one side of the pool area. Mr Mitchell said over a period of time the sand was supposed to be redistributed elsewhere by using a wheelbarrow, and this never happened, and the pile of sand stayed there for a whole year. Mr Mitchell said both the reviews they received, as well as the feedback he received was that the park was not being maintained, and that was consistent with what Ms Mitchell found when she arrived on 24 April 2023.
Ms McCormick said the claim in relation to there being long grass was not true as the lawn was mowed every week. Ms Mitchell said she was on sick leave from 30 March to 5 April. Ms McCormick said there was a pile of green waste, and the trailer was full. Ms McCormick said it was an exaggeration to say that it was metres high, and that they did not have a vehicle to take the trailer to the tip and she was having trouble getting reliable locals. Ms McCormick said it was probably across two sites. Ms McCormick agreed there was sand left over from the pool project. Ms McCormick said the pool project was completed in July or August 2022, and she had got some quotes to repair some driveways in the park and she intended to use the sand for that and had received some quotes to have that work done however Mr Mitchell did not like any of the quotes and instead he was telling ‘Patti’ to move the sand with a wheelbarrow and Ms McCormick said ‘Patti’ is an older lady and small, and she could not carry the sand in a wheelbarrow.
7. Alleged failure to implement any COVID regulations.
Mr Mitchell said that Ms McCormick is anti-vaccination and is very up front about that, and refused to have anything to do with Covid-19. Mr Mitchell gave examples of putting up signs or doing scans or whatever the Government mandated they had to do as a business. Mr Mitchell said they had to take on that task, and it is an example of Ms McCormick refusing to do things. Mr Mitchell said the signs included the number of people allowed in rooms, that they had to communicate to customers they could not enter the park if they had Covid, and that people had to wear masks and the requirement to scan the QR Code to show where people were. Mr Mitchell said all these things Ms McCormick refused to have anything to do with it. Ms McCormick said she was confused over this as Mr Mitchell did not give her specific directions and Ms McCormick said she was unaware of any Covid-19 regulations she was required to implement at the time.
8. Alleged failure to do daily booking reconciliations.
Mr Mitchell said that daily reconciliations must be done to ensure the money taken in and the money in the bank is the same as the money in the system on a daily basis. Mr Mitchell said this is another example of Ms McCormick just not doing it. Ms Mitchell said that she had been trained to do this and had done it before in another park where she worked previously. Ms Mitchell said that Ms McCormick did do it for the first year and a half however when they questioned her about discrepancies, she would say she hadn’t reconciled that bit yet, and it would be a month period at a time where Ms McCormick hadn’t reconciled so they couldn’t trace whether there was an issue or not.
Ms McCormick said between herself and ‘Patti’ they did do daily reconciliations. Ms McCormick said she did not do it personally everyday because she was required by the contract to try and have two days off a week which never ended up happening. Ms McCormick said the ones that were not done for months properly would have been a couple in xero, and she was the only one responsible in the xero-accounting program. Ms McCormick said a specific account was set up by Ms Mitchell through the Accountant, and if there were one or two things at the end of the BAS period she would put them there. Ms Mitchell said that was a different process to the RMS booking system. Ms McCormick replied that it was done by herself and ‘Patti’ and it was done every day. Mr Mitchell said they knew it was not done because every time they did a BAS statement every three months there were issues with the reconciliations, and Ms Mitchell had to go back and do heaps of reconciliations to track down missing payments.
9. Alleged failure to arrange repairs for simple items, like faulty smoke detectors, and instead blocked out these rooms resulting in several weeks of lost revenue.
Mr Mitchell said in just one example when he got to the park in May, motel unit 1 had been blocked out for several weeks because of a faulty smoke detector. Mr Mitchell said initially he called an electrician to look at it, and the electrician at first simply replaced the battery. He said it played up again and the electrician the replaced it the following day. Mr Mitchell said it took two phone calls to the electrician to fix the issue, however the particular site had been out of actions for weeks and weeks causing lost revenue. Ms McCormick said she did block out the room with a faulty smoke detector. Ms McCormick said she had tried to change the battery, and she also tried to clean it. Ms McCormick said that was all she could do, and she needed an electrician. Mr Mitchell said that all she needed to do was call an electrician. Ms McCormick said that she had called, and the electrician was very busy, but it was put on his job list. Mr Mitchell said the room was out of action for six weeks, and when he got to site the issue was fixed in 2 days and the room was available again. Ms McCormick said she thought it was only unavailable for a couple of weeks. She submitted that she arranged for repairs as required, and that at times, this required her to restrict access to rooms while awaiting the completion of repairs. She stated that electrician costs were necessary in relation to electrical repairs that she was unable to perform herself.
10. Alleged failure to reset tripped circuit breakers in the office, resulting in unnecessary Electrician callout fees.
Mr Mitchell said because Ms McCormick was not managing the tenants, one of the tenants rang him because the tenant had no power. Mr Mitchell said Ms McCormick was not responding to him and he couldn’t get hold of her, so he told the tenant to look at the power board on the side of the unit and it was okay. Mr Mitchell said the next place where the power could have been tripped was inside reception, however the tenant could not get into the reception because it was locked. Mr Mitchell claimed the tenant said to him that they couldn’t go to reception if Ms McCormick was there because Ms McCormick would just tell her to get out. Mr Mitchell said the tenant had no power for several hours and he could not do any more to try to diagnose the problem, so he was forced to call an electrician, and the electrician came and got access to the office and the power was being tripped in the office. Mr Mitchell said the electrician call out fee was completely unnecessary as all Ms McCormick had to do was to walk down stairs to the office to flick the trip switch but she refused to do it.
Ms McCormick said the switch in the office did trip sometimes, and it would cut her power as well and it was later found by the electrician that there was a water leak causing the problem. Mr Mitchell said the electrician had told him that is not what happened on this occasion as he said all he had to do was flick the switch.
CONSIDERATION
To assess whether the Respondent has satisfied the Small Business Fair Dismissal Code in cases of summary dismissal involving serious misconduct, a Fair Work Commission Full Bench in Pinawin v Domingo (2012) 219 IR 128, the Full Bench explained the following two steps as follows:
“[8] For an employer to believe on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal, it is firstly necessary for the employer to establish that the employer did in fact hold the belief that as a matter of fact that (i) the conduct was by the employee; (ii) the conduct was serious; and (iii) that the conduct justified immediately dismissal. This is to be contrasted to the provisions of s.387(a) where FWA, in determining whether there was a valid reason for the dismissal, must find whether the conduct in fact occurred.
[9] Secondly, it is necessary for the employer to establish that there are reasonable grounds for the employer holding the belief. It is thus necessary for the employer to establish a basis for the belief held which is reasonable. In this regard it would usually be necessary for the employer to establish what inquiries or investigations were made to support a basis for holding the belief. It would also ordinarily be expected that the belief be put to the employee, even though the grounds for holding it may not be. Failure to make sufficient enquiries or to put the accusation to the employee in many circumstances might lead to a view that there was no reasonable grounds for the belief to be held.”
I have considered all of the evidence as set out above and I am satisfied that the evidence supports the conclusion that the Applicant had over a period of time been neglecting a range of important parts of her role, and was failing to respond to the owners of the business in a timely way or at all when they raised concerns about issues that they were becoming aware of through other sources. It is also apparent that towards the end of the employment relationship the working relationship had completely broken down.
The Applicant did not take steps to implement the directions to revive the backpacker part of the business when the effects of the Covid pandemic were reduced and international backpackers were returning to the area. The evidence also supports the conclusion that the part of the business related to permanent tenants had fallen away, and the Applicant was not cooperating with the owners of the business to address these issues.
I am satisfied that both Mr and Ms Mitchell did in fact hold the belief that as a matter of fact Ms McCormick was deliberately avoiding having contact with them for an extended period prior to her dismissal, was not answering customers calls, and was wilfully neglecting her duties by allowing the park to fall into a poor state. Mr and Ms Mitchell also held the belief that Ms McCormick was not managing the permanent tenant or backpacker parts of the business and was taking money out of the business when payments were made in cash and not reconciling these payments. Mr and Ms Mitchell also held the belief that Ms McCormick was responsible for serious safety breaches including concerning not maintaining the kitchen in the backpacker area such that it failed a council inspection, and not maintaining the pool fence. I am also satisfied that Mr and Ms Mitchell held the belief that Ms McCormick’s conduct in these areas was serious, and the conduct justified immediate dismissal.
I am satisfied that the Respondent has established on the evidence that there are reasonable grounds for the employer holding these beliefs. The repeated failure of Mr and Ms Mitchell to be able to contact Ms McCormick and to be able to discuss the concerns they held with her that had been raised well before her termination on 29 April, supports the conclusion that there is a reasonable basis for their belief that Ms McCormick was avoiding efforts to engage with her over the serious concerns. There was also a reasonable basis for the belief that Ms McCormick was not answering many calls made to the park, because for the period of time when calls were diverted to the Mitchells the proportion of phone enquiries was much higher than the business was reflecting in its performance. The evidence also tends to support a reasonable basis for the belief that Ms McCormick had been neglecting important parts of her role as the evidence concerning the poor state of the park was coming from a range of sources independent of Mr and Ms Mitchell, but these reports were consistent with what Ms Mitchell found when she arrived at the park on 24 April.
The reduction in the number of permanent tenants, and the failure to develop the income stream from the backpacker part of the business despite evidence of a significant increase in demand from overseas backpackers also supports the view that the Respondent’s beliefs in regard to the conduct of Ms McCormick concerning these issues was reasonable. The anomaly concerning cash income in the month of February 2023, the direct advice from Mr Cupitt about him having made regular payments, and the advice from the customer who booked through booking.com and made a cash payment, taken together support the view that cash was missing from the business, and given Ms McCormick’s specific role in regard to the control of these areas of the business, the belief that she was responsible for money being missing was reasonable. Having said this, it should not be taken as a positive conclusion that Ms McCormick did take cash from the business, only that the belief that she was responsible for money being missing, was a reasonable belief. To be clear this is not a finding that Ms McCormick did take any money. The backpacker kitchen failing a council compliance check also supports the Respondent’s belief that Ms McCormick was failing in relation to an important safety issue.
The concerns referred to were raised with Ms McCormick and she was given an opportunity to respond to them. The exception to this is the concerns the Respondent held in relation to missing money as Ms McCormick did not have access to the Respondent’s financial records on its information technology system from 28 April. It may be arguable that on this basis the holding of the belief that Ms McCormick was responsible for money being missing was not reasonable as she did not have an opportunity to respond by interrogating the evidence that may have led to an explanation for these beliefs. In my view the issue is moot, because the other issues on their own are sufficient to establish that the employer had a reasonable basis to believe that the other conduct was wilful and deliberate and inconsistent with the continuation of the employment contract, and was also causing a serious and imminent risk to the reputation, viability or profitability of the business.
For the reasons set out above, I am satisfied that the Respondent has complied with the Small Business Fair Dismissal Code, and on that basis the application is not within jurisdiction and is dismissed. An order to this effect will be issued separately and concurrently with this decision.
COMMISSIONER
Appearances:
Ms Amber McCormick on her own behalf.
Mr Colin Mitchell and Ms Rosalind Mitchell for the Respondent.
Hearing details:
2023
By Microsoft Teams Video
18 August
Printed by authority of the Commonwealth Government Printer
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