Australian Crane and Machinery Pty Ltd t/a Australian Crane and Machinery v Mr Jeremiah Shakotko

[2018] FWC 7179

[2018] FWC 7179

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s 604 - Appeal of decisions

Australian Crane and Machinery Pty Ltd t/a Australian Crane and Machinery
v
Mr Jeremiah Shakotko
(C2018/6365)

DEPUTY PRESIDENT SAMS SYDNEY, 26 NOVEMBER 2018

Appeal against decision [[2018] FWC 6510] of Commissioner Cribb at Melbourne on 23 October 2018 in matter number U2018/13118 – appeal of unfair dismissal decision – order of compensation – application for a stay of the decision and order – attempted conciliation – prospects of success – balance of convenience – stay application granted – orders made.

[1] This decision confirms my ex tempore decision of 22 November 2018, on a stay application made by Australian Crane and Machinery Pty Ltd (the ‘appellant’) in respect to an application for permission to appeal, and an appeal filed by the appellant on 13 November 2018. The appeal is brought pursuant to ss 604 and 400 of the Fair Work Act 2009 (the ‘Act’). The appeal is against a decision and compensation order of Commissioner Cribb, published in Melbourne on 23 October 2018; see: Shakotko v Australian Crane and Machinery Pty Ltd 2018 FWC6510 and Print PR701635.

[2] The decision and order followed an earlier decision of the Commissioner delivered in transcript on 3 April 2018, in which the Commissioner found that Mr Shakotko had been dismissed pursuant to s 385 of the Act, and that his dismissal was ‘harsh, unjust and unreasonable,’ as comprehended by ss 385 and 387 of the Act and reinstatement would be inappropriate (s 390(3) of the Act). At the conclusion of proceedings that day, the Commissioner directed the parties to file and serve further submissions and evidence on the matters to be considered under s 392 of the Act when determining the amount of compensation to be paid to the respondent in respect to his unfair dismissal. Submissions and documents (including payslips) were filed, and the Commissioner determined that an amount of compensation of $72,000 be paid to the respondent within 21 days.

THE APPEAL

[3] The appellant raised three grounds of appeal, set out as follows:

1. The appellant submits that it is in the public interest to ensure that orders of compensation are calculated correctly. In particular, such orders should be based on the correct remuneration information;

2. It is also in the public interest to ensure that any orders for compensation made by the Commission comply with the compensation cap requirements prescribed by s 392(5) of the Act; and

3. Further, it is in the public interest to ensure that findings that an employee has been unfairly dismissed within the meaning of s 385 of the Act are only made when the employer has taken action to dismiss the employee.

First ground

1. The Commission calculated the amount of compensation on the basis that Mr Shakotko was earning $3,080.00 gross per week at the time his employment ended with Australian Crane and Machinery Pty Ltd. In determining this figure, the Commission cited an email from Mr Shakotko dated 24 April 2018 as well as Mr Shakotko’s pay slip for the period ending 31 October 2018.

2. However, the email from Mr Shakotko dated 24 April 2018 and Mr Shakotko’s pay slip for the period ending 31 October 2018 both clearly evidence the fact that Mr Shakotko was earning $3,080.00 gross per fortnight.

3. As a result of this error, the amount of compensation that was ordered by the Commission pursuant to s 392 of the Act, was grossly overstated, and indeed, the amount ordered significantly exceeded the total amount of the compensation cap prescribed by that section.

4. The order that Australian Crane and Machinery Pty Ltd pay to Mr Shakotko the amount of $72,000.00 gross as compensation was also erroneous because this figure was expressed to represent half the amount of the high income threshold of $142,000.00. However, half the amount of the high income threshold was actually $71,000.00 gross.

Second ground

1. The error of fact was made in reliance upon an email from Mr Shakotko dated 8 April 2018 and the attachments to that email.

2. In summary, this email reveals that Mr Shakotko had obtained casual employment for a period of 3 weeks after his employment with Australian Cranes and Machinery Pty Ltd ended.

3. In addition, the email and attachments reveal that on 5 February 2018, Mr Shakotko accepted a full-time position with a new employer and that he commenced employment with that new employer on 9 April 2018.

4. However, Mr Shakotko’s email suggests he negotiated a later start date to accommodate the hearing of this matter. Australian Cranes and Machinery Pty Ltd should not be penalised for that decision.

5. Moreover, the finding of the Commission that Mr Shakotko ‘had made reasonable attempts to mitigate his loss’ did not take into account the evidence provided by the PA to the Managing Director of Australian Cranes and Machinery Pty Ltd, Hannah Prouse, that she spoke to Mr Shakotko on 13 December 2018 and informed him that he had not been dismissed, but was welcome to resume work immediately. This version of events was accepted by Mr Shakotko.

Third ground

1. The Commission found that the letters issued by Australian Cranes and Machinery Pty Ltd to Mr Shakotko on 28 November 2017 and 18 December 2017 had the combined effect of terminating Mr Shakotko’s employment.

2. However, it is clear from the wording of these letters that Australian Cranes and Machinery Pty Ltd was not dismissing Mr Shakotko. Indeed, the letter dated 18 December 2017 actually states (among other things): ‘your employment with Australian Cranes and Machinery has not been terminated.’

3. Indeed, based on all of the evidence that was given during the hearing, Australian Cranes and Machinery Pty Ltd did not take any action which constituted termination of employment. On the contrary, Australian Cranes and Machinery Pty Ltd immediately informed Mr Shakotko his employment had not been terminated when it realised Mr Shakotko mistakenly believed he had been dismissed.

[4] I listed the stay application on 16 November 2018 and informed the parties that I considered the matter would benefit from a member-assisted conciliation. The stay application was adjourned and Commissioner Riordan kindly offered to assist on two subsequent occasions. Unfortunately, this was unsuccessful and I heard the stay application on 22 November 2018. Mr M Alden, solicitor, appeared for the appellant with permission granted to s 596 of the Act, and Mr Shikotko appeared for himself.

SUBMISSIONS

[5] In oral submissions, Mr Alden submitted that the appellant’s primary ground of appeal, being that the amount of compensation was incorrectly calculated by the Commissioner, was conceded by the respondent and at least in respect to that ground of appeal, permission to appeal would be granted by the Full Bench based on a significant error of fact.

[6] The appellant also put that the Commissioner did not properly exercise her discretion when she considered the efforts of the respondent to mitigate his loss, as required by s 392(2)(d) of the Act.

[7] The appellant also intended to press its third ground of appeal, namely that the Commissioner incorrectly found that the respondent was dismissed by the appellant in her decision of 3 April 2018. At this point, I raised with Mr Alden that the Full Bench would need to be persuaded to extend time for filing its appeal in respect to Ground 3, given that the decision as to jurisdiction was made by the Commissioner on 3 April 2018, and the only appeal before the Full Bench was that filed on 13 November 2018. In this respect, I directed Mr Alden’s attention to the decision of the Full Bench in Spinifex Australia Pty Ltd t/a Spinifex Recruiting v Patrice Tait[2018] FWCFB 6267.

[8] Mr Alden submitted that given the agreed circumstances, the balance of convenience must favour the appellant.

[9] The respondent accepted that the Commissioner’s calculation of his annual remuneration was incorrect and that this led to a compensation order which must be in error. He did not otherwise oppose the stay order being sought and put no submissions as to balance of convenience.

CONSIDERATION

Statutory provisions and applicable principles

[10] Section 606(1) of the Act provides that:

‘(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.’

[11] The principles to be applied by the Commission in considering an application for a stay order are now well settled. These principles are set out in the decision of Ross VP (as he then was) in P Edghill v Kellow Falkiner Motors Pty Ltd (Print S2639), which was adopted by the Full Bench of the Australian Industrial Relations Commission (AIRC) in Edghill v Kellow-Falkiner Motors Pty Ltd (Print S4216). His Honour said at paras [5] and [6]:

‘[5] In determining whether to grant a stay application the Commission must be satisfied that there is an arguable case, with some reasonable prospect of success, in respect of both the question of leave to appeal and the substantive merits of the appeal. In addition, the balance of convenience must weigh in favour of the order subject to appeal being stayed. Each of the two elements referred to must be established before a stay order will be granted.

[6] The Commission approaches applications for stay orders on the basis that, unless otherwise established, the order subject to appeal was regularly made.’

See also: Boom Logistics Limited v Bell and Mackay[2013] FWC 1017; GM Holden Ltd v Symonds[2013] FWC 332; Vondoo Hair v Crockett[2012] FWA 9553; Vita Property Group Pty Ltd v Clayworth[2012] FWA 6547; DesignInc (Sydney) Pty Limited v Xu[2012] FWA 1088; Suncorp Staff Pty Limited v Brewer[2012] FWA 823; and Gippsland Waste Services Pty Ltd v Irene Meadley[2013] FWC 3090.

[12] As Mr Alden submitted, and Mr Shakotko properly conceded, it must be accepted that the Commissioner made an error in determining the annual amount of the respondent’s remuneration when embarking on the calculation of compensation, according to the Sprigg formula; see: Sprigg v Paul’s Licenced Festival Supermarket (1988) 88 IR 21. The effect of the error is not inconsequential. Accordingly, I have no doubt that the appellant’s prospects of success as to this ground of appeal are unarguable. Permission to appeal is likely to be granted on this basis. Accordingly, the first limb of the stay principles is satisfied.

[13] As to the balance of convenience, given the appeal is to be heard on 12 December 2018 as to both permission to appeal and the appeal proper, and that the issues in this appeal are narrow and relatively straightforward, I do not consider that this short timeframe unduly prejudices the respondent. Considering the appellant’s prospect of success, the balance of convenience weighs in favour of the appellant.

[14] For the abovementioned reasons, I am satisfied that the application for a stay of the Commissioner’s decision and order should be granted. I order accordingly. The stay order will take effect from 22 November 2018 and remain in force until further order of the Commission.

DEPUTY PRESIDENT

Appearances:

Mr M Alden (Solicitor for the Appellant)

Mr J Shakotko (Self-represented)

Hearing details:

2018

Sydney

22 November 2018

Printed by authority of the Commonwealth Government Printer

<PR702579>