Benjamin Yu v Hansen Yuncken Pty Ltd T/A Hansen Yuncken

[2021] FWC 486

[2021] FWC 486

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Benjamin Yu
v
Hansen Yuncken Pty Ltd T/A Hansen Yuncken
(U2020/8167)

COMMISSIONER CAMBRIDGE SYDNEY, 4 FEBRUARY 2021

Unfair dismissal - valid reason for dismissal - significant procedural deficiencies - advice of dismissal sent by email - dismissal harsh and unjust - nominal compensation provided.

[1] This matter involves an application for unfair dismissal remedy made pursuant to section 394 of the Fair Work Act 2009 (the Act). The application was lodged at Sydney on 13 June 2020. The application was made by Benjamin Yu (the applicant) and the respondent employer is Hansen Yuncken Pty Ltd T/A Hansen Yuncken ABN 38 063 384 056 (the employer or HY).

[2] The application indicated that the date that the applicant’s dismissal took effect was 27 May 2020. Consequently, the application was made within the 21 day time limit prescribed by subsection 394 (2) (a) of the Act.

[3] The matter was not resolved at conciliation, and it has proceeded to arbitration before the Fair Work Commission (the Commission) in a Hearing conducted at Sydney on 22 October 2020.

[4] At the Hearing the applicant represented himself, and he provided evidence as the only witness called in support of the unfair dismissal claim. The employer was represented by its Operations Manager, Mr J Wilson, who appeared together with Ms E Todd, the employer’s HR Advisor. MrWilson provided evidence as a witness, and he introduced a Witness Statement of Ms Todd which was admitted into evidence without the need for Ms Todd to be called as a witness.

Background

[5] The applicant had worked for the employer for about 1 year and 3 months. The applicant was employed in a position described as a Building Cadet. The Building Cadet position provided the applicant with practical experience as an adjunct to his full-time study for a Bachelor of Construction Management and Property. The Building Cadet program involved the applicant regularly rotating across different worksites so as to provide him with exposure to and experience in working in a variety of different aspects of the Construction Industry.

[6] The employer operates a large Building/Construction company that undertakes significant construction project work throughout Australia. The employer is not a small business and it has in excess of 600 employees across nine offices, and an annual turnover exceeding $1 billion.

[7] The applicant’s employment was without any identified complaint or concern and the applicant undertook the Building Cadet role successfully. In February 2020, the employer advised the applicant that his next workplace rotation would be at a construction site in the Sydney suburb of Minto.

[8] The move to the Minto site meant that there would be additional travel time for the applicant, and the applicant had concerns associated with travelling on public transport during the Covid-19 pandemic. Consequently, the applicant made a request to be permitted to work from home. The employer rejected this request primarily because a fundamental aspect of the Building Cadet role involved practical, on-site work experience.

[9] On 23 March 2020, the applicant participated in a meeting with inter alia, Mr Wilson and Ms Todd which was held to discuss the rejection of the applicant’s request to work from home. During this meeting, the rejection of the applicant’s request to work from home was confirmed, and he was offered the options of either, undertaking work at the Minto site, or alternatively, to commence a period of leave that would initially involve annual leave after which the applicant would take leave without pay.

[10] Following the meeting held on 23 March 2020, the applicant initially advised the employer that he would commence to take annual leave from the following day, 24 March 2020, and he requested that he be provided with a further six days to consider his position further. On 1 April 2020, the applicant sent an email to the employer which inter alia, stated “… I will be taking leave without pay starting from tomorrow and I will return when I see fit to resume work as discussed and agreed upon in last Monday’s meeting (23/03/20).”

[11] Consequently, the applicant commenced a period of leave without pay on 2 April 2020. On 14 April 2020, the applicant sent an email to the employer which stated: “As discussed on the phone today, in light of the current situation I will continue to take unpaid leave and provide you with an update at the end of May.”

[12] On Thursday, 21 May 2020, the applicant attended a further meeting at the employer’s NSW office in the Sydney suburb of Alexandria. The meeting was called by the employer in order to clarify the applicant’s anticipated return to work. Mr Wilson conducted the meeting and Ms Todd was also in attendance. The evidence has disclosed considerably different recollections of the detail of what was said during this meeting.

[13] Mr Wilson said that when he asked the applicant about his anticipated return to work, the applicant responded by indicating that he would take another month or two off. Mr Wilson said that he was surprised that the applicant apparently believed that he could unilaterally decide when he would return to work. Further, Mr Wilson said that he made it very clear to the applicant that a further one or two months was not acceptable, and that if the applicant did not return to work in the near future, or nominate a date for his return, the employer could not guarantee to continue his employment.

[14] The applicant had a different recollection about what was said to him by Mr Wilson during the meeting held on 21 May 2020. According to the applicant, when he had said to Mr Wilson that he would provide further information about his return to work later in June, Mr Wilson indicated broad acceptance of this proposition, and stated words to the effect: “in a few weeks’ time, but the earlier the better” and “the sooner the better, two weeks from now should be fine.” Mr Wilson rejected the comments that were attributed to him by the applicant.

[15] On Sunday, 24 May 2020 at 8:55 pm the applicant sent an email to Mr Wilson and Ms Todd. This email stated: “As discussed and agreed during Thursday’s meeting (21/05/20) which was part of the May update, I will continue to take leave without pay as per our existing agreement and provide you with an update/check-in around mid- June.”

[16] On Monday, 25 May 2020, Mr Wilson and Ms Todd discussed the email that had been sent by the applicant on the previous evening with the employer’s NSW & ACT Manager, Mr N Luzar. As a result of the applicant’s email which did not clarify his return to work, the employer decided to terminate the employment of the applicant. The employer prepared a letter of dismissal dated 25 May 2020, which inter alia, stated: “We have noted your advice about your uncertainty of when you would return to work and due to the reasons noted above, regrettably HY is unable to offer you a role at this time. … HY therefore will need to put in place a termination of your role, effective 27 May 2020.”

[17] Subsequently, either later on Monday 25 May, or early the following day, Tuesday, 26 May, the applicant was telephoned by either Mr Wilson or Ms Todd, who told the applicant to check his emails, no further explanation was provided to the applicant. The applicant then checked his emails whereupon he discovered the dismissal letter dated 25 May 2020.

[18] The dismissal letter that was provided to the applicant by email also indicated that the applicant would be paid one month’s remuneration in lieu of notice of his dismissal. Since the termination of his employment, the applicant has unsuccessfully attempted to find alternative employment. The applicant’s full-time study requirements have understandably restricted his prospects for finding alternative employment.

The Case for the Applicant

[19] The applicant provided written submissions on 23 August 2020, and he elaborated upon this documentary material with oral submissions that were made during the Hearing. The applicant said that his dismissal was not only unjust, but also harsh and unreasonable.

[20] The applicant submitted that despite a perfect employment record he had been terminated without valid reason, or opportunity to respond, or provided with any notification or consultation. The applicant submitted that the circumstances surrounding his dismissal involved a lack of procedural fairness which he said was frankly unacceptable from an organisation with the resources of a large construction company such as the employer.

[21] The submissions made by the applicant asserted that the employer had offered him leave without pay on the condition that he provide the employer with an update each month. The applicant submitted that prior to receiving the email dismissal letter there had been no discussion, warning, or notification that he might be dismissed. Further, the applicant submitted that the arrangement which involved him taking leave without pay had been made at the suggestion of the employer, and it was most unreasonable and unfair for the employer to retrospectively wind back the terms of the agreement without notice.

[22] The applicant further submitted that in all of the circumstances his dismissal was harsh, unjust and unreasonable. The applicant stressed that he had been terminated without any valid reason, or proper consultation, or notice, or opportunity to respond. The applicant also submitted that the employer had unilaterally breached his employment contract, and it was evident that the offer of unpaid leave was not extended in good faith, but was instead used as a tool to unfairly punish him due to the employer’s perceived inconvenience arising from the applicant’s requests.

[23] The submissions made by the applicant also asserted that his relationship with the employer had been damaged beyond repair and the employer’s actions demonstrated a wilful and obstinate refusal to do the right thing. The applicant submitted that he was seeking compensation as remedy as he had unfortunately lost all trust in the employer.

[24] The applicant concluded his submissions by stating that there had been no wrongdoing on his part in respect to the termination of his employment. The applicant stressed that throughout the whole process, dismissal had never been raised and in particular it had not been raised during the last meeting before he was dismissed. The applicant stated that he was asking for an award of five months’ pay.

The Case for the Employer

[25] The employer provided written submissions which were supplemented by oral submissions made by Mr Wilson during the Hearing. The employer submitted that the dismissal of the applicant was not unfair, harsh or unreasonable and that the application for unfair dismissal remedy should be dismissed.

[26] The employer submitted that during the meeting held on 21 May 2020, the employer gave the applicant a reasonable direction to return to work and the applicant failed to comply with that reasonable direction. The employer’s submissions asserted that following the meeting on 21 May 2020, the applicant was provided with one or two days by which time he would contact the employer and provide a return to work date. According to the submissions made by the employer, as a result of the applicant advising that he would not return to work, the employer was entitled to decide to terminate the employment of the applicant.

[27] The oral submissions made by Mr Wilson included that the applicant was still of the view that he could take leave without pay for as long as he chose. Mr Wilson stated that a business could not function if an employee was capable of nominating at his or her discretion when they would return from unpaid leave.

[28] The further oral submissions of the employer stressed that the employer believed that it had given the applicant a reasonable direction and it required him to clarify the date upon which he would return to work. The applicant had failed to comply with that reasonable direction and instead sought to maintain his period of unpaid leave at his discretion. Accordingly, the employer submitted that there was valid reason for the dismissal of the applicant because he failed to follow the reasonable direction to return to work or provide a date for such return to work.

[29] In summary, the submissions made by the employer asserted that the applicant was not entitled to any remedy as his dismissal was not harsh, unjust or unreasonable. The employer submitted that the applicant had been dismissed for valid reason when he refused to return to work or provide a date for his return to work. The employer submitted that it would be a challenging circumstance for any employer to operate under an arrangement where an employee could take unpaid leave for an undefined period of time. The employer submitted that it was left with no option but to implement the termination of the applicant’s employment.

Consideration

[30] The unfair dismissal provisions of the Act relevantly include s. 385 which stipulates that the Commission must be satisfied that four cumulative elements are met in order to establish an unfair dismissal. Section 385 is in the following terms:

“385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.”

[31] In this case, there was no dispute that the matter was confined to a determination of that element contained in subsection 385 (b) of the Act, specifically whether the dismissal of the applicant was harsh, unjust or unreasonable.

[32] Section 387 of the Act contains criteria that the Commission must take into account in any determination of whether a dismissal is harsh, unjust or unreasonable. These criteria are:

“(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 the FWC considers relevant.”

S. 387 (a) - Valid reason for the dismissal related to capacity or conduct

[33] In this instance, the applicant was dismissed because the employer considered that the applicant had failed to comply with its reasonable direction regarding clarification of his return to work from a period of unpaid leave. The applicant’s purported failure to follow the reasonable direction of the employer was captured by the email that he sent to the employer at 8:55 pm on Sunday, 24 May 2020. In this email, the applicant advised that he was continuing what he considered to be an existing agreement whereby he would unilaterally determine the date upon which he would return to work from unpaid leave.

[34] There was conflicting evidence about the detail of the conversation that took place during the meeting held on Thursday, 21 May 2020, at which time Mr Wilson, Ms Todd and the applicant discussed the applicant’s anticipated return to work. Importantly, the applicant said that Mr Wilson had agreed to a period of about two weeks for the applicant to clarify his return to work. Mr Wilson asserted that he had made no agreement or comment indicating that a period of two weeks would be acceptable. Further, Mr Wilson said that he had made it very clear to the applicant that the employer would not accept a further one or two months of absence of the applicant from the workplace.

[35] The applicant’s email response was sent to the employer on Sunday, 24 May 2020, a period of three days after the meeting. Consequently, the applicant was providing his response much sooner than was necessary if, as he said, Mr Wilson had indicated a period of “two weeks from now should be fine.” Therefore, the contested aspects of the detail of the conversation that occurred during the meeting on Thursday, 21 May 2020, would appear to be generally more accurately reflected by the version provided by Mr Wilson wherever it conflicted with the applicant’s recollection.

[36] The evidence has established that during the meeting on Thursday, 21 May, Mr Wilson had made it clear to the applicant that the employer would not permit a further one or two months of unpaid leave for the applicant. Unfortunately, the applicant held the mistaken and somewhat novel belief that he could unilaterally determine when he would return from unpaid leave. During the meeting held on Thursday, 21 May, Mr Wilson and Ms Todd attempted to explain to the applicant that the employer was bringing his period of unpaid leave to an end. The applicant’s email response on Sunday, 24 May, bluntly rejected this proposition, and the applicant, perhaps naïvely, attempted to exercise what he believed to be his total control to make the decision about when he would return to work.

[37] The applicant’s ongoing mistaken and naïve belief that he could unilaterally determine when he would return to work from unpaid leave was confirmed during the Hearing as the following extract from the transcript reveals:

“THE COMMISSIONER: Did you understand that you had the total control to make the decision about when you would return?

MR YU: Yes, I did. 1

[38] At the time when the agreement for the applicant to take unpaid leave was developed, the applicant included a documented stipulation that “I will return when I see fit to resume work as discussed and agreed upon in last Mondays meeting (23/03/20).” However, it is simply untenable to contemplate that an employee could dictate to an employer that it must maintain a period of unpaid leave indefinitely and entirely at the discretion of the employee. Importantly, at the meeting held on 21 May 2020, the employer attempted to disavow the applicant of any misguided belief that he could unilaterally determine the date upon which he would return to work from unpaid leave. Regrettably, the applicant attempted to challenge this proposition when he sent the email on 24 May, which boldly suggested that he would provide contact with the employer in around mid-June.

[39] In summary therefore, the conduct of the applicant whereby in his email of Sunday, 24 May 2020, he confirmed his refusal to accept that the employer could exercise its requirement for him to return to work, or stipulate a date upon which he would return to work, represented a refusal to comply with the reasonable direction of the employer and thus provided valid reason for the dismissal of the applicant.

S. 387 (b) - Notification of reason for dismissal

[40] The employer provided notification of the reason for the applicant's dismissal by email communication. Communication of the advice of dismissal by electronic means such as email or text message, should generally be avoided. Unless there is some compelling reason like extensive distance or genuine safety concern, advice of dismissal from employment is a matter of such significance that it should be conveyed in person.

[41] Regrettably, in this instance there was no justifiable reason why the applicant was provided notification of his dismissal by email. In such circumstances, the notification of dismissal of the applicant was unnecessarily callous and unreasonable.

S. 387 (c) - Opportunity to respond to any reason related to capacity or conduct

[42] The applicant was not given an opportunity to respond to the circumstances regarding the seriousness that the employer was attaching to the applicant’s email response of 24 May 2020. Although there was contest in respect to detail of the conversation that occurred between the applicant and Mr Wilson during the meeting on 21 May 2020, the evidence provided by Mr Wilson about what he said to the applicant did not confirm that termination of employment may arise in the event that the applicant failed to return to work or clarify a date for his return. For instance, Mr Wilson provided evidence that he said to the applicant words to the effect of: “The Company respects your position, however HY could not support a further 1 to 2 months non-attendance at work. We would need to know and agree a plan prior to the 1 to 2 months you are nominating.” 2

[43] Consequently, the applicant was not informed that if he failed to clarify his return to work then termination of employment was a likely consequence. Indeed, some of the words spoken by Mr Wilson would have encouraged the applicant to continue to test the circumstances and explore further whether a plan for a return to work in “1 to 2 months” might be developed.

[44] Therefore, the decision to implement the dismissal of the applicant without first advising the applicant that his email response of 24 May was unacceptable, and that unless the applicant specified a date for his return to work, the employer was likely to proceed with termination of employment, represented a significant procedural error. The approach that was adopted by the employer was severely flawed and it denied the applicant natural justice.

[45] Although the evidence that was subsequently presented in the Hearing has confirmed the applicant’s misguided belief that he could exercise a unilateral right to determine when he would return to work from unpaid leave, without first testing whether the applicant would maintain that approach once he was aware that his employment was at risk, has meant that the decision to dismiss the applicant was taken without providing the applicant with an opportunity to be heard. If the applicant had been provided with an opportunity to be heard and he maintained his misguided belief and failed to provide a return to work date, then the employer would have implemented a dismissal with proper process. The absence of that proper process represents a fundamental injustice.

S. 387 (d) - Unreasonable refusal to allow a support person to assist

[46] In a technical sense, the employer did not unreasonably refuse to allow the applicant to have a support person present to assist at any discussions relating to dismissal because there were no such discussions. Consequently, the process that the employer adopted avoided any opportunity for the presence of a support person to assist the applicant, and can be construed to represent an unreasonable refusal to allow the assistance of a support person.

S. 387 (e) - Warning about unsatisfactory performance

[47] This factor is not relevant to the circumstances in this instance as the applicant was not dismissed for unsatisfactory performance but instead, misconduct associated with his refusal to comply with the reasonable direction to return to work or stipulate a date upon which he would return to work.

S. 387 (f) - Size of enterprise likely to impact on procedures

[48] The employer is a large size business operation and therefore it was quite surprising to observe the severely flawed procedure that it adopted in respect to the implementation of the dismissal of the applicant. In particular, it was very surprising that the employer would contemplate conveying a letter of dismissal by email in circumstances where there was no justification for providing advice of dismissal in such a callous fashion.

S. 387 (g) - Absence of management specialists or expertise likely to impact on procedures

[49] There was evidence that the employer did have management specialists and other staff with employment related expertise. Consequently, it was very disappointing that despite the presence of such specialist management staff, the employer adopted a seriously flawed procedural approach that denied the applicant natural justice.

S. 387 (h) - Other relevant matters

[50] In this instance, there was no evidence of other relevant matters that would impact upon the determination of the applicant’s unfair dismissal claim.

Conclusion

[51] The applicant was dismissed because he failed to comply with the reasonable direction of the employer when it sought to clarify the applicant’s return to work from a period of unpaid leave. The applicant’s failure to comply with the reasonable direction of the employer represented misconduct. The applicant’s misconduct was unfortunately a manifestation of his mistaken and naïve belief that he could unilaterally determine when he would return from a period of unpaid leave.

[52] The conduct of the applicant as evidenced in his email communication to the employer on the evening of Sunday, 24 May 2020, was misconduct that established valid reason for the dismissal of the applicant. However, the valid reason for dismissal has been assessed and evaluated against significant procedural errors which were evident in the manner that the employer determined and implemented the dismissal of the applicant.

[53] The procedural errors in this case were matters of significance such that the applicant was denied natural justice. There was no justification for not hearing from the applicant before the decision to dismiss was made. Further, the communication of advice of dismissal via email was entirely inappropriate and unnecessarily harsh.

[54] Therefore, although the applicant was dismissed for valid reason involving his misconduct, the significant procedural defects evident in respect of the determination and implementation of the dismissal of the applicant have rendered the dismissal to have been harsh and unjust. The applicant’s dismissal has been found to have been unfair and the Commission must logically consider the appropriate remedy that should be provided in this instance.

Remedy

[55] At the Hearing, the applicant advised that he was pursuing compensation as remedy for his unfair dismissal. The applicant suggested that any compensation should involve an amount of five months remuneration.

[56] In the circumstances, particularly as the employment of the applicant was significantly damaged by the unfortunate circumstances surrounding his email to the employer on the evening of 24 May 2020, reinstatement would not be an appropriate remedy. In the circumstances of this case, the appropriate remedy would logically involve a limited amount of monetary compensation.

[57] I have decided that compensation would be an appropriate remedy for the applicant’s unfair dismissal, and I turn to the factors which involve the quantification of any amount of compensation.

[58] Section 392 of the Act prescribes certain matters that deal with compensation as a remedy for unfair dismissal. I have approached the question of compensation having regard for the guidelines that have been established in the Full Bench Decisions of, inter alia; Sprigg v Paul’s Licensed Festival Supermarket 3 (Sprigg); Smith and Ors v Moore Paragon Australia Ltd 4 and more recently, the cases of; McCulloch v Calvary Health Care Adelaide5; Balaclava Pastoral Co Pty Ltd v Nurcombe;6 and Hanson Construction Materials v Pericich7(Pericich).

[59] Firstly, I confirm that an Order for payment of compensation to the applicant will be made against the respondent employer in lieu of reinstatement of the applicant.

[60] Secondly, in determining the amount of compensation that will be Ordered, the Commission has taken into account all of the circumstances of the matter including the factors set out in paragraphs (a) to (g) of subsection 392 (2) of the Act.

[61] There was no evidence provided which established that an Order of compensation would impact on the viability of the employer’s enterprise.

[62] The applicant had been employed for a period of about one year and three months. The applicant would have been likely to have received remuneration of approximately $861.00 per week if he had not been dismissed.

[63] There was clear evidence upon which to conclude that the employment of the applicant would have finalised in accordance with a proper and just contemplation of his conduct associated with his mistaken belief that he could unilaterally determine when he would return to work from a period of unpaid leave. Consequently, the employment of the applicant would have concluded within three weeks after his unfair dismissal.

[64] For the purposes of calculation of remuneration that the applicant would have received or would have been likely to receive if he had not been dismissed, I have considered that the employment of the applicant would have continued for a further three weeks. Therefore, the total remuneration that would have been received in the notional period of three weeks following dismissal amounted to a figure of $2,583.00.

[65] The total amount of remuneration received in alternative employment, as identified, and that which may be reasonably likely to be earned between dismissal and the making of the Order for compensation, has been calculated to be $0. There was evidence that the applicant had unsuccessfully sought to obtain alternative employment in circumstances where his prospects for securing alternative employment were limited.

[66] Thirdly, in this instance there was no established misconduct of the applicant that should result in a reduction in the amount of compensation to be provided.

[67] Fourthly, I confirm that any amount Ordered does not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt caused to the applicant by the manner of the dismissal.

[68] Fifthly, the amount Ordered does not exceed the compensation cap as prescribed by s. 392 (5) of the Act.

[69] Consequently, for the reasons outlined above, taking into account all of the circumstances of the case, and having cognisance so as not to apply the approach taken in the Decision in Sprigg in a rigid, determinative manner, as was cautioned in the Decision in Pericich, I have decided that the amount of compensation to be provided to the applicant should be a gross figure of $2,583.00.

[70] Accordingly, separate Orders [PR726571] providing for unfair dismissal remedy in these terms will be issued.

COMMISSIONER

Appearances:

Mr B Yu appeared unrepresented.

Mr J Wilson, Operations Manager appeared for the employer.

Hearing details:

2020.
Sydney:
October, 22.

Printed by authority of the Commonwealth Government Printer

<PR726569>

 1   Transcript @ PN262-PN263.

 2   Exhibit 4 - page 10.

 3 Sprigg v Paul’s Licensed Festival Supermarket, (Munro J, Duncan DP and Jones C), (1998) 88IR 21.

 4   Smith and Ors v Moore Paragon Australia Ltd, (Lawler VP, Kaufman SDP and Mansfield C), (2004) PR942856.

 5   John McCulloch v Calvary Health Care Adelaide, (Ross P, Hatcher VP and Gostencnik DP), [2015] FWCFB 873.

 6   Balaclava Pastoral Co Pty Ltd t/a Australian Hotel Cowra v Darren Nurcombe, (Hatcher VP, Gostencnik DP and Cribb C) [2017] FWCFB 429.

 7   Hanson Construction Materials Pty Ltd v Darren Pericich, (Ross P, Masson DP and Lee C), [2018] FWCFB 5960.