Andrew Claffey v Casabene Group

[2018] FWC 7872

[2018] FWC 7872

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Andrew Claffey
v
Casabene Group
(U2017/9038)

COMMISSIONER CRIBB MELBOURNE, 28 DECEMBER 2018

Application for an unfair dismissal remedy – remedy.

[1] Mr Andrew Claffey (the Applicant) has made an application under section 394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy. The application is in relation to the termination of his employment by the Casabene Group (the company, the Respondent).

[2] A decision was issued on 23 February 2018 1 in relation to the Respondent’s jurisdictional objection where it was found that there had been a dismissal at the initiative of the employer. A second decision2 was issued on 3 September 2018 in relation to Mr Claffey’s substantive application. In this decision, it was determined that Mr Claffey’s dismissal was harsh, unjust and unreasonable.3 However, due to insufficient material before the Commission, it was not possible to determine the question of remedy.

[3] The parties were requested to provide written submissions in relation to whether or not reinstatement was appropriate and with respect to the criteria for deciding the amount of compensation (section 392 (2)). Mr Claffey provided various documents on 7 November 2018 and 28 November 2018. The company filed its Remedy Response on 30 November 2018.

[4] This third decision deals with the question of remedy.

Section 390

[5] Section 390(3) states that the Commission must not order the payment of compensation unless two conditions have been met. The first condition is that the Commission is satisfied that reinstatement is inappropriate (section 390 (3)(a)).

[6] In Mr Claffey’s letter dated Wednesday 10 October 2018, Mr Claffey advised that reinstatement was not a viable option as a result of too much damage to the employer/employee relationship. 4 Mr Claffey stated that the goodwill and trust was no longer there because the good relationship had been severely damaged.5 For its part, the company held the same view – that reinstatement was not a viable remedy because of the company’s lack of trust and confidence in the employment relationship.6

[7] I have considered the evidence before me and the submissions of the parties. Taking into account all of the circumstances of this matter, I am satisfied that reinstatement of Mr Claffey is inappropriate. The parties indicated that there was no longer trust and confidence in the employment relationship for each of them. Therefore, it would be inappropriate to reinstate Mr Claffey in these circumstances.

Compensation

[8] Section 390(3) be requires that the Fair Work Commission consider it appropriate, in all of the circumstances of the case, to award compensation. Taking into account all of the circumstances of this matter, an order for payment of compensation is considered appropriate.

Section 392(2) of the Act sets out the criteria for deciding the amount of compensation in all of the circumstances of the case. These criteria are:

“(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

(a) the effect of the order on the viability of the employer’s enterprise; and

(b) the length of the person’s service with the employer; and

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

(g) any other matter that the FWC considers relevant.”

[9] I will deal with each of the criteria in turn, guided by the Full Bench decision in Haigh v Bradken Resources Pty Ltd  7 (Haigh). In Haigh, the Full Bench also referred8 to the Full Bench decisions which have applied the approach in Sprigg v Paul Licensed Festival Supermarket9 (Sprigg). I respectfully adopt the approach taken in Haigh.

Section 392 (2) (a) – effect on the viability of the employer’s enterprise

[10] It was submitted by the Respondent that Mr Claffey’s former role was highly specialised and was able to give the company a competitive advantage. Once it was no longer occupied, the competitive advantage no longer existed and so the company sold the assets related to this function. 10

[11] There is no material before the Commission regarding the effect of an order of compensation on the company.

Section 392 (2) (b) – Applicant’s length of service

[12] The Respondent stated that Mr Claffey commenced as a casual employee on 27 July 2016 and was engaged as a permanent full-time employee on 18 January 2017. Mr Claffey’s final day of employment was 28 July 2017. It was indicated by the company that Mr Claffey’s total length of service during that period, including casual service, was 12 months. 11

Section 392 (2)(c) – remuneration would have received

[13] On the basis of the evidence before me, in all of the circumstances of this matter, I have formed the view that, if Mr Claffey had not been dismissed, he would have continued in employment for a period of 6 months. For the purposes of the calculations, in accordance with the Sprigg principles, it is determined that the remuneration that Mr Claffey would have received was 6 months’ pay.

[14] On the basis of Mr Claffey’s payment summary for the financial year ending 30 June 2017, Mr Claffey’s weekly earnings were $1,620.42 gross per week. 12 Therefore, the provisional amount Mr Claffey would have received for the 6 month period of anticipated employment is $42,130.92 (gross).

Section 392 (2) (d) – efforts to mitigate loss

[15] On the basis of the documentation provided by Mr Claffey, it is apparent that Mr Claffey has made considerable efforts to mitigate his loss. This is through having gained employment with firstly one employer and then subsequently a second employer. Therefore, I am satisfied that Mr Claffey has taken steps to mitigate his loss.

Section 392 (2) (e) and (f) – remuneration earned and income reasonably likely to be earned

[16] In accordance with the findings made in relation to section 392(2)(c) above, the period of anticipated employment is from 29 July 2017 to 28 January 2018. Therefore, it is Mr Claffey’s earnings for that period only that are required to be taken into account.

[17] Mr Claffey provided bank records for his wages from two employers. 13 Given the period of anticipated employment, it is only the first employer (Mad Bros) that is relevant. The first credit for wages (nett) in Mr Claffey’s account was on 4 September 2017 and the final relevant payment was on 31 January 2018. During this period, the total nett amount paid into Mr Claffey’s bank account for wages was $17,559. This amount does not include ‘air con repairs’ (29 November 2017) but it does include ‘Andrew 3 weeks’ paid on 27 December 2017.14

[18] In order to estimate Mr Claffey’s gross earnings for the period of anticipated employment, the nett amount paid to Mr Claffey of $17,559 was doubled to make it an annual nett figure of $35,118. Using the website of (17/18 tax rates), the nett annual figure of $35,118 was “grossed up” to an estimated $38,900 gross per annum (with a nett annual amount of $35,127). The figure of $38,900 gross per annum was then divided by two to give an estimated six month figure of $19,450 gross. This represents an estimate of the gross amount that Mr Claffey earned between 29 July 2017 and 28 January 2018.

[19] It was anticipated above that, if Mr Claffey’s employment had not been terminated, Mr Claffey would have earned $42,130.92. As Mr Claffey has earned estimated remuneration of $19,450 gross, it is necessary to deduct the monies earned from the provisional amount. This results in a revised provisional amount of $22,680.92 (gross).

Section 392 (2) (g) – other matters

[20] The Respondent submitted that other relevant matters included that, although Mr Claffey stated that he was dismissed because of an injury, the company was never aware of any injury and had never been provided with a medical certificate. Secondly, it was stated that Mr Claffey had previously been employed by the company and that he had abruptly left the company. Therefore, Mr Claffey’s employment from July 2016 was the second opportunity given to him by the company. Finally, it was stated that the Respondent’s customers lost trust and confidence in the company’s ability to perform the role occupied by the Applicant. This was said to have forced the Respondent to cease this role. 15

Section 392 (3) – misconduct

[21] Section 392 (3) of the Act requires that, if the Commission is satisfied that the person’s misconduct contributed to the employer’s decision to dismiss the person, the Commission must reduce the amount it would otherwise order. In this matter, Mr Claffey was not dismissed for misconduct. Therefore, this section is not relevant.

Contingencies

[22] As the anticipated period of employment has passed, it is not proposed to make a deduction for contingencies. Therefore, the provisional amount remains as $22,680.92 (gross).

Section 392 (4) – shock or distress

[23] No part of the provisional compensation amount relates to any shock or distress suffered by Mr Claffey.

Section 393 – payment by instalments

[24] There are no submissions before the Commission requesting payment by instalments.

Section 392(5) - compensation cap

[25] The amount to be ordered by the Commission must not exceed the lesser of the provisional compensation amount and half the amount of the high income threshold immediately before the dismissal. The provisional amount of compensation is $22,680.92 gross. Half of the high income threshold (as of 1 July 2017 - $142,000.00) is $72,000.00 gross. The lesser of the two amounts is $22,680.92 gross.

Conclusion

[26] Therefore, it is considered appropriate to make an order that the Casabene Group pay $22,680.92 gross, less taxation as required by law, in compensation to Mr Claffey, in lieu of reinstatement, within 21 days of this decision.

[27] An order 16 to this effect will be issued separately.

Final written submissions:

Applicant, 7 November 2018

Respondent, 30 November 2018

Printed by authority of the Commonwealth Government Printer

<PR703538>

 1   [2018] FWC 1116

 2 [2018] FWC 4992

 3   Ibid. at [41]

 4   Two emails from the Applicant, dated 7 November 2018

 5   Ibid.

 6   Remedy Response from the Respondent, dated 30 November 2018, page 1

 7   [2014] FWCFB 236

 8   Ibid at paragraphs [10]-[12]

 9 (1998) 88 IR 21

 10   Remedy Response from the Respondent, dated 30 November 2018, at page 1

 11   Ibid. at page 1

 12   Ibid. at attachment

 13   Two emails from the Applicant, dated 7 November 2018

 14   Ibid.

 15   Remedy Response of the Respondent, dated 30 November 2018, pages 3 – 4

 16   PR703539