Azharul Huq v George Fanous & Co Pty Ltd
[2011] FWA 3634
•11 JULY 2011
[2011] FWA 3634 |
|
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Azharul Huq
v
George Fanous & Co Pty Ltd
(U2010/2544)
COMMISSIONER HARRISON | SYDNEY, 11 JULY 2011 |
Termination of employment - unfair dismissal - arbitration.
[1] This matter concerns the dismissal of Mr Azharul Huq (the applicant) by George Fanous & Co Pty Ltd (the respondent). It is not contested that the respondent is a small business for the purposes of the unfair dismissal jurisdiction as provided by the Fair Work Act 2009 (the Act).
[2] The applicant was terminated for misconduct on 11 October 2010 following over two years and three months employment with the respondent. He was engaged as an assistant accountant.
[3] Before considering the merits of the application s.396 of the Act requires that I must determine certain matters. I am satisfied the application was filed within time, the applicant has sufficient service to be protected, the applicant was dismissed by the respondent and the dismissal was not the result of a genuine redundancy.
[4] Both parties were self represented during proceedings on 15 March 2011 and at the outset I conducted a conference by consent of the parties to attempt a settlement.
[5] During the conference it became apparent that both parties had diametrically opposing views regarding the issue which led to the applicant’s termination. In these circumstances I advised I required sworn evidence from each to ascertain the facts of the matter.
[6] The respondent relied upon a supporting affidavit sworn by Ms Kimberly Cushway who is employed as the respondent’s secretary. The content of the statement is largely hearsay and opinion. Ms Cushway was not available for examination and I have given no determinative weight to the statement.
The applicant’s evidence
[7] It was the applicant’s evidence that he commenced employment with the respondent on 1 July 2008. During the first two months he was not paid because he lived with the respondent and needed to be “tested”.
[8] On 9 September 2010 he applied in writing for four weeks leave to commence on 27 September. A copy of the application was annexed to the respondent’s submissions. It reads as follows:
“Dear Sir,
Re - Annual Leave Application
Please refer to my letter dated 26.08.2010 regarding my leave application. Our Doctor has determined the date of delivery on 27.09.2010. Therefore, I advise that I need to take the leave one week later.
In this circumstance, I kindly request the 4 (four) weeks leave starting from 27.09.2010 to 22.10.2010. I will resume my position at the office on 25.10.2010 accordingly.
Sorry for any inconvenience this may have caused and I thank you in advance.
Best regards”
[9] The copy of the leave application has a written notation stating:
“2 weeks granted from 27/9/10 to 8/10/10”
and signed “G Fanous”.
[10] It was the applicant’s evidence that the first time he saw the written notation was in February 2011 when the respondent filed his statements in accordance with the directions issued to the parties following unsuccessful conciliation of the application for relief.
[11] Under questioning the applicant stated that at no time prior to commencing leave was he advised he could not take the four weeks requested.
“[THE COMMISSIONER]: Were you verbally told at any time before you took your leave that you had only been granted two weeks and not four weeks?---No. He approved me four weeks verbally.
Verbally?---And he - - -
Were you at any time told that you could only take two weeks?---No. Initially, I verbally asked for six weeks but he said, “Six weeks, it is very irrational, so you cannot take six weeks; apply for four weeks,” so I applied for four weeks.
And you say at no time before you proceeded to take that leave were you verbally told that you could not take four weeks, you can only take two weeks?---No. It is not mentioned.” 1
[12] On the eve of the applicant taking the leave he was given a final warning for misconduct. A copy of the warning was also annexed to the respondent’s submissions and reads as follows:
“Further to our last meeting about 2 months ago, I hereby advise you this is now your Final Warning.
I do not accept your Rude and Unacceptable behaviour and your Obscene Language in my office.
You should note unless your behaviour improves significantly and conduct yourself in a better and more professional manner I will have no alternative but to Terminate your Employment forthwith and without further notice.
You should note this is now your Absolute Final Warning.
Signed
GEORGE FANOUS - Principal”
[13] The applicant’s explanation for the warning was that the respondent demanded respect and tried to impose unreasonable work practices upon him. He stated ten secretaries had been terminated in one year:
“...is not bad behaviour and if he don’t like anyone, he terminates; and I mention that the reason the final warning was given, I have only 15-minute lunchtime and I work 45 hours a week - and this 15 minutes’ lunchtime, I was having my lunch and my employer called me to his office. I went there and he asked me to find two cheque butts. I said that, “I am about to finish my lunch so after finishing, I’ll find it out.” He said, “No. I say you find it out now.” I said, “My lunch is going to be finished within two, three minutes.” I stopped my work because this finding out the cheque butts, it is not - I cannot find it, two, three minutes. It will take half an hour because previously also we are looking for the cheque butts and many source documents, looking for the many files, then find it out. But he was very angry and said, “No. You stop your lunch and find out what I say.” Then I said, “I will not find out. I’ll finish my lunch, then I find out.” That was the other thing that he mention in - and that was the reason he gave me a final warning. Then in fact, I did not finish my lunch. I packed my lunch and I look for and I find it out, the two cheque butts and I gave it to my employer.” 2
[14] It was the applicant’s evidence that the first time he became aware that the respondent had withdrawn his approval for four weeks leave was when the respondent telephoned him at home on 11 October:
“[THE COMMISSIONER]: So you were aware then that Mr Fanous wanted you back two weeks earlier than what you assumed you had been given approval for. When did you resume work after that telephone call? Did you resume work at all after that?---No.
No? ---Because on same day he terminates me by phone, he said.
So in that telephone conversation on the 11th, can you recall what was said in your own words?---He called me to come back to office and I said, “I am on leave so I cannot come back to office, and I have a very bad situation. My wife is very sick. I cannot leave my wife and kids, and I have still two weeks further to go so after two weeks later, I’ll come back,” but my employer says, “You come back today, now, or I’ll - you are terminated.”” 3
[15] On 13 October the applicant telephoned the respondent to request a separation certificate and it was agreed one would be posted. Several hours later the applicant received a phone call from the respondent requesting he attend the office to collect the certificate:
“....so I went there. He formally explain me the reason why he terminates me. He give me many reasons, that without any reason, an employer can terminates any employee, and moreover, “You do not come when I need you. You did not come - show your respect when I called you.” This is the reasons he give me, and he mentioned that, “I give you last warning and you didn’t listen to that,” so and end the meeting, he said, “I’ll post it to you,” the certificate.” 4
[16] Under cross examination by the respondent the applicant denied he was offered reinstatement during the above meeting. He restated the sole purpose of the meeting was for the respondent to explain the reason for his termination.
[17] The applicant stated he had unsuccessfully applied for other employment since his termination.
The respondent’s evidence
[18] It was the respondent’s evidence that he approved only two weeks leave from 27 September to 8 October for the applicant and that he was so advised on 23 September 2010. He stated he photocopied the notated application and gave the applicant a copy.
[19] On 11 October 2010, the day the respondent claims the applicant was to return from leave, the respondent stated he made several phone calls to ascertain his whereabouts:
“Eventually he called back and he called the office. He didn’t call me on my mobile, he called the office, so the secretary transferred the call. I said to him, “Azharul, why aren’t you at work today as was scheduled?” and, “I expected you to be at work today.” He said, “I’m not coming to work today, or any soon.” I said to him, “What do you mean?” He said, “Well, I need to stay with my family,” and I said to him, “But you’re only granted two weeks’ annual leave and that has expired last Friday so you are due to come to work today,” and I also told him, “Even if you had issues at home, why didn’t you call me to explain the reason you are not at work today? You failed to do that. You failed to comply with company rules and it was me who had rang you twice to find out why you are not here at work. You didn’t have the courtesy or the common protocol to call me to give me some - or to keep me aware of what’s happening. I was the one who rang you several times.” He said, “Well, I’m not coming to work and I’m not coming to work any sooner.” I said to him, “But this is very unsatisfactory, unacceptable. You are jeopardising my business. I have deadlines. I have clients’ deadlines to meet. I’ve counted on you to come to work today to finish jobs so this is - you are now jeopardising my business because I’ve got deadlines,” and his answer to that, said, “I don’t care.” Then I told him, “Well, you have a choice, either to come to work as soon as possible or find yourself alternative employment.” He said, “That’s fine,” and that was the end of that conversation.” 5
[20] The respondent confirmed that the applicant telephoned him on 13 October to request a separation certificate and he agreed to post it to him. He also corroborated the applicant’s evidence that several hours later he telephoned the applicant to organise a meeting at 6.00pm the same day, however they differed about the purpose of the meeting. The respondent’s evidence is that he decided to give the applicant another chance and told him that the purpose of the meeting was to discuss reinstatement. The applicant denies this.
“He said, “That’s fine,” so that was on the phone at the time. The secretary heard that conversation and it’s in her affidavit, confirming that this conversation took place and confirming the answers, that the purpose of that meeting was to reinstate his employment. This is further evidenced by the work diary, which is also included in my submission. On that day, 6 o’clock pm, he came to the office. After a short discussion, I’ve re-offered the position back to him, full reinstatement of his position, which he declined, so that was the end of it. I wished him well.
What did he say in respect of declining the offer?---He said, “No. I’m not accepting the position.”
Did he give any reason?---No.” 6
[21] The disputed facts in this matter are whether the applicant was given authorised leave for two or four weeks and whether he was offered reinstatement two days after his termination.
[22] Having observed both parties present their recollections of events I prefer the evidence of the applicant. With the impending birth of his child, the applicant initially sought six weeks leave and then reduced it to four. It is at this point where the evidence of both parties is widely divergent. The respondent stated that he had never approved four weeks leave and provided documentation that he had only approved two. The applicant was certain during examination that he was given verbal approval for four weeks and the first he was aware the respondent wanted him to return any earlier was when he was telephoned on 11 October. I therefore find that the applicant was authorised to take four weeks leave as per his leave application as set out at paragraph 8 above.
[23] On the balance of probabilities it was the respondent’s disregard for the desire of the applicant to take his full approved leave without interruption which led to the termination.
[24] The respondent is a small business of three employees, which at the time of the applicant’s termination comprised the applicant, the respondent and a secretary. It is inconceivable that in such a small work environment a simple request for leave created such a communication breakdown which led to the applicant’s dismissal. The respondent would not accept any challenge to his authority. I am satisfied and find that the applicant’s insistence on completing his four weeks leave was a scenario that the respondent found unacceptable. It is arguable that, in the context of such a small enterprise, the applicant could have been more flexible. However, his possible inflexibility does not amount to misconduct.
Conclusion
[25] The small business code applies in this matter. The Code provides as follows:
“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 for 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.”
[26] As the applicant’s conduct is the reason given by the respondent for the termination, I have to determine for myself whether the conduct occurred and, if so, whether it amounted to a valid reason for termination of employment. In this regard I respectfully agree with the following observations of the Full Bench in King v Freshmore (Vic) Pty Ltd 7:
“When a reason for a termination is based on the conduct of the employee, the Commission must, if it is an issue in the proceedings challenging the termination, determine whether the conduct occurred. The obligation to make such a determination flows from s.170CG(3)(a). The Commission must determine whether the alleged conduct took place and what it involved.
The question of whether the alleged conduct took place and what it involved is to be determined by the Commission on the basis of the evidence in the proceedings before it. The test is not whether the employer believed, on reasonable grounds after sufficient enquiry, that the employee was guilty of the conduct which resulted in termination.”
[27] In Container Terminals Australia Limited v Toby 8, a Full Bench of the Australian Industrial Relations Commission said: “In our view, the consideration of whether there was a valid reason for termination is a separate issue from the determination of whether a termination was harsh, unjust or unreasonable…”9
[28] Northrop J in Selvachandran v Peteron Plastics Pty Ltd 10 said:
“In its context in s 170DE(1), the adjective "valid" should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s 170DE(1). At the same time the reason must be valid in the context of the employee's capacity or conduct or based upon the operational requirements of the employer's business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must ‘be applied in a practical, commonsense way to ensure that’ the employer and employee are each treated fairly, ….”
[29] In Qantas Airways Ltd v Cornwall 11, the Full Court of the Federal Court said:
“The question is whether there was a valid reason. In general, conduct of that kind would plainly provide a valid reason. However, conduct is not committed in a vacuum, but in the course of the interaction of persons and circumstances, and the events which lead up to an action and those which accompany it may qualify or characterize the nature of the conduct involved.”
[30] In Edwards v Justice Giudice 12, Moore J said:
“The reason would be valid because the conduct occurred and justified termination. The reason might not be valid because the conduct did not occur or it did occur but did not justify termination.”
[31] In this matter I am satisfied that the dismissal was a summary dismissal at the initiative of the employer. The applicant was not given notice of termination nor was any payment made in lieu of notice.
[32] I do not accept that the applicant was granted only two weeks leave and I reject the respondent’s evidence that reinstatement was offered to the applicant two days after the termination.
[33] I conclude and find that the applicant did not engage in any form of misconduct and that the small business code was not followed. I must now consider whether or not the termination was unfair having regard to the provisions of s.387 of the Act:
“387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWA 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 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 FWA considers relevant.”
[34] For the reasons discussed earlier I find there was not a valid reason for the dismissal without notice. The applicant was entitled to assume that he could take his approved leave without any interference from the respondent, this did not constitute any type of misconduct.
Section 387(b) - whether the applicant was notified of that reason
[35] The applicant was notified of the reason for the termination of his employment when the respondent telephoned him at his home.
Section 387(c) - opportunity to respond to any reason related to the capacity or conduct of the person
[36] The applicant was not given any proper opportunity to respond to the reason for the termination of his employment.
Section 387(d) - any unreasonable refusal by the employer to allow the applicant to have a person support present to assist at any discussions relating to dismissal
[37] No discussion took place prior to the termination and is not relevant in any event given the reason advanced by the respondent for the termination.
Section 387(e) - if the dismissal related to unsatisfactory performance by the person - whether the applicant had been warned about that unsatisfactory performance before the dismissal
[38] The applicant received a warning about his conduct or performance, however I regard this as contrived.
Section 387(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
[39] This is a small business. It appears that the respondent only sought to explain the reasons for dismissal after the event. The size of the business would have impacted on the procedures followed.
Section 387(g) - the degree to which the absence of dedicated human resource management or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal
[40] There was no dedicated human resource management specialists or expertise in the business and this impacted on the procedures followed.
Section 387(h) - any other matters that FWA considers relevant
[41] I have taken into account the applicant’s length of service with the respondent. On all of the material before me I must conclude and find that the termination of the applicant was harsh, unjust and unreasonable.
Remedy
[42] Section 390 of the Act empowers the Tribunal to order a remedy if an employee is unfairly dismissed:
“390 When FWA may order remedy for unfair dismissal
(1) Subject to subsection (3), FWA may order a person’s reinstatement, or the payment of compensation to a person, if:
(a) FWA is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) FWA may make the order only if the person has made an application under section 394.
(3) FWA must not order the payment of compensation to the person unless:
(a) FWA is satisfied that reinstatement of the person is inappropriate; and
(b) FWA considers an order for payment of compensation is appropriate in all the circumstances of the case.”
[43] The applicant is seeking reinstatement and I believe his willingness to return to the respondents employ is genuine. In the circumstances of this matter it would be impractical and inappropriate to order reinstatement. My analysis of the evidence and my observation of the parties convince me that it would not be possible for them to re-establish a working relationship. Section 392 sets out the criteria for determining the amount of compensation in lieu of reinstatement as follows:
“Compensation
(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.
Criteria for deciding amounts
(2) In determining an amount for the purposes of an order under subsection (1), FWA 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;
[44] No submissions were made on this criterion. In any event, the quantum of compensation I intend to order is not at a level which could threaten the viability of the enterprise.
(b) the length of the person’s service with the employer;
[45] The applicant had been employed for over two years.
(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed;
[46] This question requires some measure of speculative judgment. On the evidence before me, the parties have had a difficult working relationship and I do not consider that the applicant would have remained in the employment with the respondent for a particularly long period.
(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal;
[47] The applicant has sought to mitigate his loss and I so find.
(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;
[48] There is no evidence of any income earned since the termination.
(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;
[49] This is not a relevant criterion.
(g) any other matter that FWA considers relevant.
[50] There are no other matters.
[51] Having regard to all of the factors set out above I determine that an amount equivalent to 4 weeks wages should be awarded to the applicant. On the information regarding weekly earnings provided by both parties, this amount will be $1815.40 gross, payable within 14 days of the date of this decision.
[52] An order giving effect to this decision will issue as Print PR511450.
COMMISSIONER
Appearances:
A Huq, the Applicant
G Fanous, George Fanous & Co Pty Ltd
Hearing details:
2011.
Sydney:
March 15.
1 Transcript PN 51-54.
2 Ibid. PN 59.
3 Ibid. PN 65-67.
4 Ibid. PN70.
5 Ibid. PN 136.
6 Ibid. PN 137-139.
7 Print S4213, 17 March 2000.
8 Print S8434, 24 July 2000.
9 Ibid at para 15.
10 (1995) 62 IR 371 at 373.
11 [1998] FCA 865.
12 [1999] FCA 1836.
Printed by authority of the Commonwealth Government Printer
<Price code C, PR510362>
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