Bridie Schroeter v Arnhem Early Learning Centre Pty Ltd T/A Arnhem Early Learning Centre
[2019] FWC 989
•27 FEBRUARY 2019
| [2019] FWC 989 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Bridie Schroeter
v
Arnhem Early Learning Centre Pty Ltd T/A Arnhem Early Learning Centre
(U2018/9264)
COMMISSIONER BISSETT | MELBOURNE, 27 FEBRUARY 2019 |
Application for an unfair dismissal remedy - serious misconduct – breach of Education and Care Regulation – breach of policies – failure to afford applicant procedural fairness – dismissal unreasonable – reinstatement not appropriate – compensation ordered.
[1] Ms Bridie Schroeter commenced working for Arnhem Early Learning Centre Pty Ltd T/A Arnhem Early Learning Centre (AELC) in late 2012 in a second in charge role (Assistant Director) under the Director. Ms Schroeter worked in this role for about two years (including a period of parental leave). On 1 April 2015, about a year after her return from parental leave, Ms Schroeter became the Director of AELC.
Termination of employment
[2] Ms Schroeter’s employment was terminated by letter on 7 August 2018. That letter was delivered to Ms Schroeter in a meeting on 7 August 2018. Ms Williams, Ms Magbag and another person who took notes were present. Ms Magbag said “I have a letter for you Bridie, the Centre has decided to let you go.” Ms Schroeter read through the letter and said to Ms Magbag that the matters of concern related to her time as Director which she had stepped down from. Ms Magbag responded that the matter was “not up for discussion.”
[3] That letter said that Ms Schroeter’s employment was terminated for:
(a) Breach of Education and Care Regulation 175 – Failing to notify Regulatory Authority of circumstances arising at the service that possess [sic] the risk to the health, safety and well-being of a child attending the service…
(b) Breach of National Law 167
(c) Breach of Accident and Incident Policy
(d) Breach of Leave Policy
(e) Breach of Family Concerns and Grievance
(e) Breach of Employee Handbook
(f) Breach of Code of Conduct
[4] The letter further stated that:
The issue regarding the…family [of child A] has caused a great deal of concern within the business and potentially has had negative influence within the community.
From the first incident which was in regards to the statutory declaration you had supplied to the benefit of the father. Please understand that you are quite free to do a statutory declaration for the father on a friendship basis, however, using the company letter head and coming from the role of director of the centre was not acceptable and a breach of the Centres code of Conduct.
The Second incident which had occurred with regards to the same family several months later we are again apologising for the mistake made again by you to this family. Whom have directly taken this matter as a complaint to the Minister and Ministerial instruction asked QECNT to investigate the matter further.
The QECNT called the provider and asked questions to conduct their report about this incident but there was no file note or any incident report on file in regards to what occurred or any follow up with the staff members who were involved, this lead to serious embarrassment suffered by the service…[sic]
[5] The letter of termination did not say which matter related to the breaches specified.
Background
[6] When Ms Schroeter commenced working for AELC there were four owners of the business Ms Hayley Palazzi and her partner Mr Aaron Palazzi and Mr David Suter and his partner Ms Maria Magbag although during the period of Ms Schroeter’s employment both Ms and Mr Palazzi left the business.
[7] Whilst Ms Schroeter was Director, Ms Magbag commenced as Assistant Director but left that role to move into the Business Manager role (for AELC and a separate company owned by Ms Magbag and Mr Suter).
Financial matters
[8] During her period as Director Ms Schroeter was subject to a number of “underperformance meetings.” These meetings were apparently held on 27 June 2017 (although the note states 2018 the remaining meeting dates suggest it should be 2017), 19 July 2017, 12 September 2017, 10 November 2017 and 2 February 2018. 1
[9] The notes of these meetings provided by AELC indicate that at each of these meetings the matters discussed primarily related to “out of control debtors” – that is, families who had not paid AELC – and strategies to reduce the level of debt. Some other matters were canvassed at the meetings but the notes indicate an on-going issue with debts owed to AELC. I would note however that the notes do not appear to have been made contemporaneously with the meetings, it is not clear when they were put together or by whom.
[10] The notes indicate that at:
• 18 June 2017 total debtors was $93,000
• 25 June 2017 total debtors was $90,000
• 19 July 2017 total debtors was $80,000
• 12 September 2017 total debtors was $50,000
• 10 November 2017 total debtors “as at today 4.12.17 is $34,610.39”
• 20 December 2017 total debtors was $36,528.91
[11] Following the meeting of 19 July 2017 Ms Schroeter was given a first warning. 2 The AELC expected that, within four weeks, no family would owe more than one week of care. At the 2 February 2018 meeting Ms Schroeter was issued with a final warning.3
[12] The final warning required “significant improvement in…performance” of Ms Schroeter by 26 February 2018. If the improvement was not achieved Ms Schroeter’s employment “may be reviewed or terminated.”
[13] Around early March 2018, and at the request of Ms Magbag, Ms Schroeter agreed to step down from the Director’s role and move onto the floor as the preschool teacher. At the request of Ms Magbag however she remained in the Director’s position until 16 April 2018. 4
[14] In around March 2018 Ms Judy Zhu had been appointed as Assistant Director to Ms Schroeter. When Ms Schroeter stood down from the role of Director Ms Zhu moved into the role.
Failure to collect child A from school
[15] In March 2018 Ms Schroeter was contacted by the mother of child A (child’s mother) and asked that the AELC collect the child from school (this apparently was a service provided by the AELC). The child’s name was not placed on the list of children to be collected and so was not collected from school (although the child was not left alone and was with a teacher from the school).
[16] No report of the failure to collect the child was made.
[17] On the day child A was not collected from school Ms Schroeter finished work (not improperly) before the collected children returned to the Centre. She was not responsible for the pick-up of the children that day. A few weeks later she proceeded on annual leave for three weeks and travelled to Malaysia. On her return she spent three weeks doing a practical placement for her studies in Darwin.
[18] Just prior to going on leave Ms Schroeter was told by Ms Magbag that Ms Zhu had made a bullying complaint against Ms Schroeter. On her return from her leave and while in Darwin Ms Schroeter met with the insurance investigator where she was told the complaint of Ms Zhu was actually against eight people at AELC and not only Ms Schroeter.
[19] On her return from Darwin Ms Schroeter was advised by Mr Suter and Ms Magbag that the child’s mother had made a complaint to the Education Department of the Northern Territory subsequently passed to Quality Education and Care Northern Territory (QECNT), a part of the Department. The complaint was that child A had not been collected from school when the child’s mother had expressly organised for this to happen with Ms Schroeter. Ms Schroeter told Ms Magbag and Mr Suter that she knew of the request and, when requested by the child’s mother, had asked Ms Zhu (who was at the time Assistant Director) to put the child’s name on the roll of children to be collected. Ms Zhu apparently denied that she had such a conversation with Ms Schroeter.
[20] On 1 August 2018 Ms Magbag responded to QECNT 5 (apparently in response to some correspondence to Ms Magbag which is not before the Fair Work Commission (Commission)) in which she said:
I am sorry that it has taken so long for me to get back to you on the outcome of the meeting [with] Bridie [Schroeter].
After Bridie’s return from 6 weeks of prac leave, we had a meeting with her re the incident - parent letter of complaint to Minister re Bridie’s conduct, as per usual she said it wasn’t her fault and she told Judy [Zhu] to add the…child’s name in the roll but Judy failed to do so.
…yesterday we finally had Judy and Bridie in the room. Judy denied that she was asked by Bridie to write the name of the child in the roll. Judy asked Bridie to show proof that she was asked to do it…
I believe that Bridie, the Director at the time had breach the Regulation 175(2c).
I have informed the approved provider [Mr Suter]…
[21] The Department responded on 3 August 2018 that “QECNT is satisfied that you have addressed incident and now considers the matter closed”.
[22] Ms Schroeter was asked to write a letter of apology to the child’s mother and asked to put in the letter that she had lost the Director’s role over the incident. Whilst Ms Schroeter did write a letter of apology and took responsibility for the failure, she refused to include that she had lost the Director’s role because of the error. It is not clear when the request to write the apology letter was made of Ms Schroeter although it appears to have been around the time of the meeting between Ms Schroeter and Ms Zhu referred to in Ms Magbag’s letter to QECNT. The final version of the letter written by Ms Schroeter was provided to the child’s mother on 21 August 2018, following the termination of Ms Schroeter’s employment.
The statutory declaration
[23] The natural parents of child A were in dispute as to the custody of the child. In late 2016 the father of child A asked Ms Schroeter to complete a statutory declaration as to her observations of the child whilst in care which she did. This was apparently filed by the father in proceedings before the Federal Circuit Court (although there is no direct evidence that this was the case).
[24] Whilst management at AELC concedes Ms Schroeder’s right to make such a declaration as a friend of the father it insists that she should not have done so in her capacity as Director and on company letterhead.
The discussion with police
[25] On 5 February 2018 Ms Schroeter says she was approached by the father of child A who informed her that there had been a change in care arrangements for the child and that there was some “stuff’ being sorted out (the AELC facilitated movement of the child between each parent as per a custody order).
[26] On 6 February 2018 Ms Schroeter saw Ms Jo Muchow, an (unsworn at that time) employee of Nhulunbuy police, and asked her if there was anything she should be concerned about in relation to child A. Ms Muchow said “no”.
[27] Ms Muchow went to work and spoke to the Senior Sergeant about the comments of Ms Schroeter. Ms Schroeter was subsequently called to a meeting with the Senior Sergeant. She told the Senior Sergeant that child A’s father had not said anything but had asked that if the child’s mother could not collect child A from school in the following week could the AELC do so. The Senior Sergeant then provided Ms Schroeter with some minimal information to enable her to meet obligations to the child.
[28] The partner of the child’s mother (partner) is a police officer and was told of the conversation between Ms Schroeter and Ms Muchow.
[29] On 10 February 2018 Ms Schroeter was informed by Mr Suter that the partner had made a complaint about Ms Schroeter. That complaint 6 said that Ms Schroeter had divulged to Ms Muchow that there was an investigation into the partner’s relationship with child A and its sibling/s. It said that Ms Schroeter had a “friendship” with child A’s father. The complaint sought that Ms Schroeter cease any disclosure of information or gossiping and act at a standard expected of the Director of AELC.
[30] Mr Suter responded to the complaint and apologised. He advised the partner that the matter would be followed up.
The application for leave
[31] On 6 July 2018 Ms Schroeter applied for a further 35 days of leave to enable her to complete her placement at Nhulunbuy Primary School (30 days leave without pay). Ms Schroeter was also taking a small number of annual leave days to travel to Darwin with a community group, to coach netball and some other matters. Ms Schroeter’s leave was to commence on 3 August 2018. She booked flights to Darwin using the company credit card as she had flights owing to her from AELC. She said she did this in view of Ms Magbag and at no time did Ms Magbag tell her not to do so or that this was not acceptable.
[32] Ms Magbag soon after advised Ms Schroeter that her leave had not been approved because the application for leave had not been made in accordance with the AELC leave policy. Ms Schroeter thought she had made her application within the time period required of the policy (which said that annual leave must be applied for “at least 4 weeks before the date” the leave is to start and leave without pay application should be made “at least six weeks in advance”). On the rejection of the leave by Ms Magbag Ms Schroeter approached Ms Samantha Williams (the new Director) and spoke to her about her leave. With a few conditions she and Ms Williams found a workable solution. At a subsequent meeting of Ms Schroeter, Ms Williams and Ms Magbag, Ms Magbag said that Ms Schroeter was not being considerate of the centre but that she would not overrule the Director’s decision.
[33] On 2 August 2018, the day before Ms Schroeter was due to commence her leave and fly to Darwin she received an email from Ms Magbag inviting her to a meeting the following day, the first day of her leave. Ms Schroeter spoke to Ms Williams who then sent her an email which indicated the leave had been approved. Ms Schroeter took this email as approving her annual leave and the leave without pay necessary to complete her placement.
[34] That email also requested that Ms Schroeter attend the AELC on 7 August 2018, on her return from Darwin, for the meeting originally proposed for 2 August 2018.
Was Ms Schroeter unfairly dismissed
[35] Section 385 of the Fair Work Act 2009 (FW Act) provides that a person has been unfairly dismissed if the Commission is satisfied that the person has been dismissed, the dismissal was harsh, unjust or unreasonable, the dismissal was not consistent with the Small Business Fair Dismissal Code and the dismissal was not a case of genuine redundancy.
[36] I am satisfied that Ms Schroeter was dismissed from her employment, the Small Business Fair Dismissal Code does not apply as ALEC has more than 15 employees and the dismissal was not a redundancy.
[37] Section 387 of the FW Act states as follows:
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 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.
[38] In order to determine if the dismissal was harsh, unjust or unreasonable I have considered each of these matters.
Section 387(a) - a valid reason for dismissal related to capacity or conduct
[39] For a reason for dismissal to be valid it must be “sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason…” 7
[40] In Rode v Burwood Mitsubishi 8the Full Bench of the Australian Industrial Relations Commission (AIRC) said:
[19] ....the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts. It is not sufficient for an employer to simply show that he or she acted in the belief that the termination was for a valid reason.
[41] In this case AELC suggests that Ms Schroeter was dismissed for serious misconduct although some of the stated reasons for the dismissal of Ms Schroeter appear to relate to her capacity – that is, her work performance.
[42] Where the reason for dismissal is in relation to the conduct of an employee it is necessary for the Commission to determine if the conduct did actually occur. 9
[43] In King v Freshmore (Vic) Pty Ltd 10the Full Bench of the AIRC said:
[24] 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. [Footnotes omitted]
[44] Performance includes “factors such as diligence, quality, care taken and so on”. 11
[45] In Crozier v Palazzo Corporation Pty Ltd t/as Noble Park Storage and Transport 12 the Full Bench of the AIRC said:
[62] We find that there was a valid reason for the termination of Mr Crozier’s employment related to his capacity. In our view an employee's performance is an incident of his or her "capacity" within the meaning of that word in s.170CG(3)(a).
[46] There were five key incidents that appear to have led to the termination of Ms Schroeter’s employment as put in the letter of termination and in the material put at hearing. I have considered each of these and determined, in the first instance, if I am satisfied as to the misconduct or failure of capacity and then if that factor provides a valid reason for dismissal. Given my findings I do not need to determine if, collectively, the conclusions on each matter provides a valid reason for dismissal.
1. Financial matters
[47] Ms Schroeter was given a “Formal Final Warning” on 5 February 2018 which required “significant improvement in…performance” by 26 February 2018. If the improvement was not achieved Ms Schroeter’s employment “may be reviewed or terminated.”
[48] In April 2018, at the request of Ms Magbag, Ms Schroeter stepped down as Director of AELC. Ms Schroeter believed that, as she no longer occupied the position of Director, those things subject to the warning that were her responsibility as Director would be put aside.
[49] The documentation provided by AELC of the meetings with Ms Schroeder make it very difficult to determine the extent to which matters with respect to the financial status of clients of the centre were consistently put or followed through with Ms Schroeter. Two sets of notes of counselling sessions have been provided to the Commission (one attached to the Form F3 and a second in the documents filed by AELC in accordance with the directions issued).
[50] It does appear that over the period June 2017 to February 2018 Ms Schroeter reduced the outstanding arrears from over $90,000 to about $35,000. Whilst this reduction might not be the level of reduction preferred by Mr Suter and Ms Magbag it does demonstrate some attention to the task at hand.
[51] In the formal final warning (which I take should properly be dated 5 February 2018) there were matters raised with Ms Schroeter which do not appear to have been previously raised.
[52] Ms Magbag’s evidence is that there was no follow up meeting with Ms Schroeter on 26 February 2018 or any date after that in relation to the performance issues that were subject to the warnings.
[53] On the basis of the evidence before me and that no further action was taken in relation to a follow up on the final warning and as Ms Schroeter no longer had responsibility or control for many of the matters covered by the final warning it is difficult to conclude that a failure to meet the standards required as Director could form a valid reason for dismissal.
[54] It is reasonable to find that the AELC had finalised matters associated with the reduction in arrears in relation to Ms Schroeter when they asked her, and she agreed, to step down from the position of Director. This can be inferred from the failure of Ms Magbag or Mr Suter to take any further action on the final warning given to Ms Schroeter in February 2018. Having settled that matter by the removal of Ms Schroeter from the position of Director, the AELC cannot now rely on it to justify the dismissal of Ms Schroeter. Further, Ms Schroeter no longer had any control or authority in relation to arrears.
[55] Ms Schroeter cannot be held responsible for things over which she had no control. Her failure to meet those requirements cannot be a sound reason for dismissal.
2. The failure to collect child A from school
[56] AELC says that Ms Schroeder’s failure to ensure child A was collected from school when this was requested by the child’s mother was a breach of the:
• Education and Care Services National Regulation 175.
• AELC Accidents / Incidents Policy as Ms Schroeder failed to report the incident;
• AELC Family Concerns & Grievance Policy (Part A) as Ms Schroeder did not communicate with child’s mother;
• AELC Staff handbook 2017;
• AELC Code of Conduct Policy. 13
[57] Ms Schroeter agreed that child A had not been collected from school when a request had been made by the child’s mother that this occur.
[58] Ms Schroeter says that she asked Ms Zhu, her Assistant Director, to put the child’s name on the list of children to be collected from school but says this did not occur. Ms Schroeter agrees that she should have checked that the child’s name was written down and failed to do so.
[59] Ms Zhu did not give evidence in the proceedings such that the only evidence as to what she said happened or what she might have been asked to do is the evidence of Ms Magbag. Ms Magbag, in her letter to QECNT said that Ms Zhu denied she was asked to write child A’s name down by Ms Schroeter and challenged Ms Schroeter to prove that she had asked her to do so.
[60] I found Ms Schroeter to be a forthright witness who readily admitted mistakes that she had made. She acknowledged that she was ultimately responsible for putting child A’s name down on the list of children to be picked up from school. She was open in the admissions she made even when they did not place her in the best position.
[61] I am satisfied on the basis of the evidence before me that Ms Schroeter did ask Ms Zhu to put child A’s name down on the list of children to be collected from school and Ms Zhu did not do so. This, however, does not absolve Ms Schroeter of responsibility. She was the Director at the time and, as such, had responsibility to the children placed in her care.
[62] I have reached this conclusion with respect to Ms Zhu because Ms Zhu did not appear to give evidence. What Ms Magbag says Ms Zhu said in a meeting with her and Ms Schroeder is not reliable evidence for the purpose of determining this question. Ms Schroeter gains nothing by maintaining that she asked Ms Zhu to put child A’s name down on the list of children to be collected from school if she had not done so. Ms Schroeter has accepted responsibility. For this reason I prefer the evidence of Ms Schroeter to that of Ms Magbag as to the conduct of Ms Zhu.
[63] I am however satisfied that the systems in place ensured child A was not left alone when not collected from school. Child A was with a teacher who attempted to contact the child’s mother and then contacted the child’s father who collected the child.
[64] I am satisfied that Ms Schroeter did write to the child’s mother and explain her responsibility for the matter. Ms Schroeter provided a draft of an apology letter dated 31 July 2018 to Ms Magbag. 14 This letter was apparently not sent to the child’s mother but rather a revised letter dated 7 August 2018 was sent15 on 21 August 2018.
[65] The child’s mother also gave evidence and suggested that the letter of apology trivialised the matter and blamed other staff for the incident. 16
[66] I do not accept this characterisation of the apology letter that was actually sent to the child’s mother (nor would it be an appropriate characterisation of the first draft of the letter prepared by Ms Schroeter). The child’s mother, in her oral evidence, said that she had not prepared her affidavit as English was not her first language. Given this evidence I am not convinced that the child’s mother had actually read and/or fully understood the apology letter received.
[67] The apology letter did not blame other staff – rather it indicated that there had been some “miscommunication” and the “booking process was not followed through”. Ms Schroeter then apologised “sincerely” for her part in the events that led to the child not being collected and stated that she should have personally written child A down and informed those responsible for collection of the children on the roll. Ultimately she took “full responsibility” for the miscommunication.
[68] The apology letter does not apportion blame to others (in fact Ms Schroeter accepted responsibility) and the letter does not trivialise the incident but rather indicates that AELC had learnt some valuable lessons arising from the incident.
[69] I do not accept that Ms Schroeter failed to email the child’s mother with an apology. Ms Schroeter was asked to write an apology letter which she did. Why that draft was not finalised and sent at an earlier date is not clear and no evidence was given on this.
[70] I am satisfied that the child’s mother did complain to the Minister, that the incident was investigated by QECNT and that QECNT were content with the actions taken by AELC in relation to the matter. To this extent I note that the evidence does not support any finding that QECNT made any adverse findings with respect to Ms Schroeter.
[71] Further, I am satisfied, on the admission of Ms Schroeter, that she failed to report the incident either internally or externally.
[72] Ultimately Ms Schroeter was responsible to ensure that child A was collected from school. She failed in this. Whilst Ms Zhu bears some responsibility this does not ameliorate the seriousness of the failure of Ms Schroeter. That child A was not left alone is a credit to the school and teacher. The safety of the child is paramount – a matter acknowledged by Ms Schroeter.
[73] To the extent that Ms Schroeter may have failed to meet the requirements of the Regulations or AELC Policy these all flow from the fundamental error she made in not ensuring the child was collected from school. In this respect I do accept the evidence of Ms Schroeter (not contested) that the day child A was meant to be collected from school she had left work for the day and did not become aware of the mistake for some days. Whilst Ms Schroeter certainly failed to report the matter (she did not understand she needed to as the child was not in danger) it is not apparent whether anyone else at AELC was aware of the incident through any direct report to it by the child’s mother at the time it occurred. Ms Schroeter was not aware of the complaint of the child’s mother to the Department and the failure in the system until she returned from six weeks leave when the matter was addressed with her by Ms Magbag.
[74] Whilst I consider the failures of Ms Schroeter serious the evidence before me supports a finding that there was also a failure on the part of Ms Zhu. However, Ms Schroeter was ultimately responsible for ensuring the child was collected from school. This is a serious matter and, on its own, provides a valid reason for the dismissal of Ms Schroeter.
3. The statutory declaration
[75] The AELC says that Ms Schroeter’s provision of a statutory declaration to the father of child A was in breach of various AELC policies. Given my finding below as to the conduct, I do not need to consider the specific policies.
[76] I am satisfied that Ms Schroeter did provide a statutory declaration to the father of child A 17 which the father intended to use in a custody case with respect to child A. I am not satisfied however that it was provided on AELC letterhead.
[77] Ms Schroeter made the affidavit as the “Director Arnhem Early Learning Centre” and affirmed that she had been the Director of the AELC for approximately 2 years and had been assistant director for two years prior to that.
[78] Ms Magbag says that it was not appropriate for Ms Schroeter to have completed the statutory declaration.
[79] The child’s mother indicated in her statement in this matter that the statutory declaration was provided by Ms Schroeter in “late 2016” 18 (although Ms Schroeter suggests it was in 201719). She says she was not afforded the same courtesy and the content of the declaration was “contentious” although did not elaborate on this.
[80] In her evidence Ms Schroeter said that had the child’s mother requested a statutory declaration at the time she would have provided one for her in the same terms as that provided to the child’s father. In this respect she said she was not taking sides. 20 Further, Ms Schroeter said that the “whole affidavit is true.”21
[81] In her Form F2 Ms Schroeter said that several months after she provided the affidavit to the child’s father Ms Magbag and Mr Suter raised the matter with her. They advised they were not happy with her having supplied the affidavit and she was not to do it again. Ms Schroeter said no further action was taken on the matter, no reprimand was issued or warning given.
[82] I accept that the AELC did not support Ms Schroeter making a statutory declaration in her role as Director of AELC although had no objection to her making an affidavit covering the same subject matter in her personal capacity. However, I note that this matter was dealt with in 2017, around the time it was declared and the conduct was not subject to any formal warning or sanction. Ms Schroeter was apparently asked not to provide such a document again as an employee of the AELC. She agreed not to do so and did not do so.
[83] Whilst this action may be seen to be contrary to policy I am satisfied that at the time it was raised as an issue it was dealt with. It was discussed with Ms Schroeter and the matter resolved. It has not been repeated.
[84] The matter having been satisfactorily resolved at the time it occurred cannot know form a valid reason for the dismissal of Ms Schroeter. At the time it warranted a discussion and request that it not be repeated. If that is the sanction it warranted then it cannot now have become a more serious issue that warrants dismissal.
[85] Relying on conduct that has been condoned by the AELC (in that it has been effectively dealt with in the past and no further action was warranted) raises serious questions as to the soundness in now relying on it to justify dismissal. 22 I am not satisfied that this matter provides a valid reason for dismissal.
4. The discussion with police
[86] AELC says that Ms Schroeter’s conduct in relation to a discussion she had with police in February 2018 was a breach of unspecified AELC policies. Because of my finding below I do not need to determine the specific policies.
[87] Ms Schroeter gave evidence 23 that, in the week of 5 February 2018, child A’s father stopped by her office and advised that if the child’s mother did not collect child A the AELC should contact him and he would collect the child. The father said that there was some “stuff/allegations” being sorted out. Ms Schroeter asked the father if “there was anything in the courts” and that, if not, the centre could not intervene in the court arrangements for collection of the child.
[88] The following day Ms Schroeter saw Ms Muchow and asked her if there was anything she needed to be aware of in relation to the family of child A. Ms Muchow apparently said no.
[89] Ms Muchow went to work and advised the Senior Sergeant of the discussion she had with Ms Schroeter. The following day Ms Schroeter was contacted by the Senior Sergeant who invited her to a discussion about the matter.
[90] On 10 February 2018 Ms Schroeter was advised of a complaint made by the partner, also a police officer in Nhulunbuy. She was not given a copy of the complaint.
[91] The partner’s complaint 24 is that:
In effect Bridie [Schroeter] disclosed to Jo [Muchow] that there was an investigation in progress relating to me and the children. Bridie was gossiping and seeking further information from Jo.
I am of the understanding that this information was divulged to Bridie by the children’s father…
The outcome we are looking for is the immediate cessation of disclosure of information and gossiping by Bridie. It is our opinion that Bridies [sic] conduct is not to a standard to be expected of a person holding the position of director of a child care centre. We view her conduct as exceptionally unprofessional and unforgiveable…
[92] On 11 February 2018 Mr Suter sent an email to the partner. He said:
• I have asked the director 11 questions based on the complaint you sent to me
• I will be meeting with her at 1 pm tomorrow questions should be answered by then
• I have also given a copy of the email to our Darwin based lawyer to review this, is just a standard matter if the word “legal” ever comes up
• I have also asked her not to talk to you without some one present and to limited to hi and good by or child matters, this is to protect the both of you and the director until this is sorted.
• I will try and speak to Jo in the morning, but she may not want to talk to me about it
• I have informed the director that I will be keeping you up dated in regard to what I am doing [sic]
[93] On 1 March 2018 Mr Suter provided a response to the partner in the following terms: 25
Unfortunately I have a bit of bad news it would seem that Maria spoke to the lady concerned at the Police station and apparently she stated that there was no breach of confidence she did not learn anything at all from Bridy in regard to your matter now I know you might find that strange but that’s what transpired I am not calling anybody anything Maria was charged with looking at this in a different way with a new set of eyes
(I did speak to her and am sure I received an other answer)
What I can’t fathom now after hearing this is why the director would be asked to meet with the OIC of the station in the first place if nothing happened , secondly why he would come to our centre and have a meeting with me
This is all getting very difficult now I have to have substantial evidence in any case of dismiss or to stand that person down it would seem now everything hinged on what was told to that lady on that day in the centre and Up until now I thought it was a slam dunk
…but getting back to the disclosure of private information Maria was told by that person from the station that no such disclosure took place again as I told you I’m in Groote Island and relying on Maria to carry this forward
I know this is not what you want to hear as I have stated I’m now very confused and I will not be speaking to this lady about this again she has said what she has said and the credibility is now at the window in my eyes in this regard, maybe there is a reason I don’t know she did tell me she did not want to be involved.
Steve if you need to take any action please feel free to do so , I’m still handling of the matter is in regard to this employee but the substance of your complaint unfortunately now has no validity as there was no breaching confidentiality so I am told… [sic]
[94] I understand, in context, that the “lady” referred to in Mr Suter’s email is Ms Muchow and Maria is a reference to Ms Magbag. The statutory declaration (raised in part of the chain of correspondence) is the matter dealt with above.
[95] On 2 March 2018 Ms Magbag sent a letter to the partner in which she said that the matter was “still under investigation” and that “the proper action will be taken”.
[96] In his evidence to the Commission the partner says that in early 2018 the father of child A made allegations of him to the police and that somehow Ms Schroeter became aware of these. He, the partner, assumed child A’s father had told Ms Schroeter. He said that no-one else was aware of the allegations. The partner said that Ms Schroeter then told Ms Muchow. He said that “Jo told me that Bridie approached her…and asked if she knew any more information about the matter.”
[97] Ms Schroeter’s evidence is that the father of child A told her something was going on with the family but not the details and, to the extent she was aware of any details these were passed on to her by the Senior Sergeant and was provided to her in her capacity as Director and in the circumstances where the AELC facilitated compliance with court orders with respect to custody.
[98] On 9 March 2018 Ms Schroeter wrote a letter of apology to the child’s mother and her partner in which she said:
I would like to apologise if any of my actions have offended you in anyway in regards to the complaint that you lodged with David Suter.
This was honestly not my intention, my only intention was to protect our Service and the children who attend here, from, what l thought could be a volatile situation.
Please know that l was not privy to any information regarding yourself Steve until l spoke to Senior Sargent ... and even once made aware of the situation it stayed with me.
Any other information that l have been privy to for the purpose of caring for the… children (supplied by their father) as a point of exchange for the parents, has also remained in my (and our staffs) confidence and will do so into the future...
[99] I am not satisfied that the evidence before me supports a finding that Ms Schroeder was privy to information of any claim that child A’s father had made in relation to the partner or that she passed this information on to anyone else including Ms Muchow.
[100] Whilst much was made of how Mr Schroeter came to be talking to Ms Muchow (the implication being that Ms Schroeter sought her out) this is not evidence that the information was known or disclosed by Ms Schroeter.
[101] The correspondence from Mr Suter to the partner confirms what he understood to be Ms Muchow’s statement – that “there was no breach of confidence”. Ms Muchow did not give evidence in the proceedings. The next best evidence must be that of Ms Schroeder. Her file note of 9 February 2018 is a note made within four or five days of the alleged incident. In it she explains the information she was given by the Senior Sergeant and does not suggest the information was given to her by the father of child A. Whilst that note may be seen to have been written only after she was made aware of the complaint and hence, be self-serving, the remaining evidence that is before the Commission does to allow an inference to be drawn that Ms Schroeder knew or divulged any information as to the conduct of the partner to anyone.
[102] For these reasons I am not convinced that Ms Schroeter engaged in the conduct complained of. It therefore cannot provide a valid reason for dismissal.
5. The application for leave
[103] The AELC says that Ms Schroeter’s application for leave for a six week period made in July 2018 was in breach of the AELC Leave Policy.
[104] I am not convinced that the leave issue provides a valid reason for the dismissal of Ms Schroeder.
[105] The AELC says that Ms Schroeder failed to abide by the Leave Policy in applying for leave due to commence on 3 August 2018.
[106] On 6 July 2018 Ms Schroeder completed a leave form in which she indicated:
• The leave code was “1/4” [annual leave and leave without pay];
• The leave period was 3 August 2018 to 25 September 2018;
• The total number of days to be taken was 35;
• She had a “30 day placement to complete: as approved by CDU”; and
• The leave was to complete her final practicum placement of Bachelor ECT.
[107] The Staff Leave Policy 26 of AELC states that, in relation to annual leave, applications should be made “at least 4 weeks before the date they want to start leave” and that leave without pay applications should be made at least six weeks in advance “giving the reason for the leave” and the “Director has the discretion to approve leave without pay.”
[108] Ms Schroeter applied for her leave on 6 July 2018. Her annual leave was due to commence on 3 August 2018 and hence met the four week application deadline. She did not however apply for her leave without pay “at least six weeks in advance”.
[109] AELC also says that, in addition to not complying with the Leave Policy, Ms Schroeter applied for 30 days leave without pay to complete her practicum placement but then went to Darwin with a community group.
[110] The leave application was originally not approved but, following a discussion between Ms Schroeder and Ms Williams (then AELC Director) it was approved. There appears to have been some confusion as to what leave was approved (the five days of annual leave or the 30 days of leave without pay). Ms Williams’ email to Ms Schroeter on 2 August 2018 27 at 11.58 am said, in part:
Thank you for sending that through to me, As advised and in the previous email I have sent you, I have reconsidered your request to take unpaid leave from the centre.
As I have received the additional information I had requested in the previous email I wish to advise [I] can approve the leave commencing this week Friday 3rd August 18.
Maria has requested that you attend a meeting on Tuesday 7th August 2018 at 10am, when you return to town, as I am approving this leave from tomorrow I am aware that you have booked your flights to go to Darwin for dance and will be unable to attend the meeting that Maria has requested for tomorrow.
During this meeting on Tuesday, we will be able to discuss further the remaining days requested of your leave and the hours for the Educational leader role.
[111] On the basis of the first two paragraphs it was reasonable for Ms Schroeter to conclude that the totality of her leave had been approved, specifically the “unpaid leave from the centre”. It is understandably difficult to understand what “remaining days” needed to be discussed at a meeting the following week. Ms Schroeter’s employment was terminated at that meeting on 7 August 2018.
[112] The evidence before me supports a finding that Ms Schroeter applied for a combination of leave without pay (30 days) and annual leave (by inference the remaining five days of the 35 days in total). The leave was initially not approved but, following discussion, apparently approved.
[113] If the complaint of AELC was that the leave was not sought in accordance with policy then the decision of whether or not to grant the leave was totally within AELC’s control. Ultimately the leave was approved. That the application was not made within the timelines specified seems a trivial matter on which to find a valid reason for dismissal.
Conclusion as to a valid reason
[114] For the reason given above I am satisfied that the failure of Ms Schroeter to ensure that child A was collected from school when she was asked to place the child on the list of students to be collected provides a valid reason for her dismissal.
Section 387(b) – whether the person was notified of the reason for dismissal
[115] On 2 August 2018 Ms Magbag sent an email to Ms Schroeter inviting her to a meeting on 3 August 2018. The email said she could “bring a support person” with her to the meeting. The meeting was subsequently re-scheduled to 7 August 2018 as Ms Schroeter was on leave on 3 August 2018.
[116] Ms Magbag said in her evidence that she advised Ms Schroeter that they were considering terminating her employment when she was issued with the final written warning in February 2018.
[117] I am not satisfied that the final warning was satisfactory advice to Ms Schroeter of the reason why her employment was terminated.
[118] As set out above, the written warning of 5 February 2018 was primarily in relation to financial and other matters within the control of the Director. At the time her employment was terminated Ms Schroeter was not in such a position of authority and those matters raised in the final written warning could no longer be a valid reason for her dismissal. In any event they appeared to have been dealt with by Ms Schroeter stepping down as Director and by the effluxion of time with no further action.
[119] In the Form F3 AELC suggests that Ms Schroeter’s employment was terminated for serious misconduct in relation to the police matter (breach of confidentiality) in February 2018 and the failure to ensure that child A was collected from school on 2 March 2018 although I note that it also suggests that there was a failure in her performance and conduct.
[120] The letter of termination suggests that the statutory declaration Ms Schroeter had supplied to the father of child A and the failure to collect child A from school were the reasons for the termination.
[121] The evidence however does not allow me to conclude that Ms Schroeter was advised that these were the reasons for dismissal prior to being dismissed.
Section 387(c) – whether the person was given an opportunity to respond
[122] As Ms Schroeter was not advised of the reasons for her dismissal prior to her dismissal it follows that she was not given an opportunity to respond insofar as the matters are relied on to justify the dismissal.
[123] I acknowledge that Ms Schroeter was given the opportunity to respond to issues raised by AELC but that this opportunity was not afforded to her at the time of her dismissal. Ms Schroeter was given such an opportunity at the time the matters were raised with her in a general sense. Except in relation to the need to reduce debtors (when she was the Director) Ms Schroeter was not advised that other matters may lead to her dismissal and so could not respond in that most important context. The failure of AELC managers to advise Ms Schroeter that AELC was considering the termination of her employment because of these matters meant that she was denied the opportunity to respond to the reason for her dismissal prior to the decision being taken to dismiss her. To the extent this might have been the case in relation to debtors, that matter was effectively addressed by her stepping down from the Director’s role and no longer having responsibility for such matters. In any event the last action on that issue was seven months prior to her dismissal.
[124] It may be that there are circumstances where there is an appropriate balancing of an ability to respond to questions during an investigation and this being accepted as an opportunity to respond to a valid reason for dismissal. In this case however the evidence does not suggest a coherent investigation into the matters relied on by AELC, advice to Ms Schroeter of the seriousness of the matters or a timely approach to the matters, particularly if AELC saw Ms Schroeter’s conduct and/or performance in relation to those matters as so serious that they constituted serious misconduct.
[125] Further, if it is, as the letter of termination suggests, that a reason for termination was the statutory declaration provided to the father of child A at least 18 months prior to the termination the evidence does not support any opportunity for Ms Schroeder to respond to that reason in any proximity to the time of termination.
[126] I accept that AELC is a relatively small employer and that it is in a relatively remote location (Nhulunbuy). This, however, cannot excuse the failure of a reasoned, clear and fair process that ensured Ms Schroeter was clearly aware of the reason for dismissal and given an opportunity to respond prior to any decision being taken to terminate her employment.
[127] I do not suggest these failures were intentional on the part of Ms Magbag or Mr Suter but they have denied Ms Schroeter procedural fairness.
Section 387(d) - unreasonable refusal by the employer to allow the person to have a support person to assist at any discussions relating to dismissal
[128] There is no claim that Ms Schroeter was denied access to a support person.
Section 387(e) – unsatisfactory performance
[129] Some of the matters relied on in relation to the dismissal of Ms Schroeter are performance related.
[130] The evidence supports a finding that Ms Schroeter was advised of the performance standards required of her when she occupied the position of Director. This primarily went to financial matters but also some management tasks.
[131] The evidence however does not support any other performance concerns being raised in such a way that the standards expected of Ms Schroeter were clearly set out, that she was offered additional training or that it was made clear that her employment was at risk should her performance not improve. In circumstances where the totality of performance related matters extended over some years the failure in this regard cannot be easily brushed aside.
Section 387(f) & (g) – the size of the employer’s enterprise and access to human resource specialists or expertise
[132] I accept that AELC is not a large business. At the time of Ms Schroeter’s dismissal AELC had about 22 employees. I also accept that it does not have dedicated human resources staff. It did however have contact with a lawyer, according to Mr Suter, in relation to the discussion with the police and with the Chamber of Commerce according to Ms Magbag in relation to the dismissal. 28
[133] I accept that these things necessarily will have affected the process used to dismiss Ms Schroeter. This however does not fully counter the lack of procedural fairness shown to Ms Schroeter.
Section 387(h) - other matters
[134] I have taken into account the multiple failures with respect to recording the need to collect child A from school and the subsequent failure to report the matter. I have also taken into account that Ms Zhu was not called to give evidence given that she played some part in that matter.
[135] Ms Schroeter also raised during the hearing that, around the time child A was not collected from school, Ms Zhu had lodged a bullying claim – ultimately investigated and the claims dismissed – against Ms Schroeter and a number of other employees at AELC. Ms Schroeter was not aware of this claim at the time she says she asked Ms Zhu to record the need to collect child A from school. Ms Schroeter suggests that Ms Zhu may have had an ulterior motive in either not recording the collection or in denying that she was asked to do so.
Conclusion
[136] Whilst the failure to include child A on the roll of children to be collected from school is a serious issue and, in conjunction with the failure to report the failure, is serious and should not be lightly dismissed I am not satisfied, on the basis of the evidence before me, that the fault rests solely with Ms Schroeter. I am not satisfied that Ms Zhu does not bear some responsibility. Further, the lack of explanation as to why a report was not done in the absence of Ms Schroeter (who was on leave immediately following the incident) is not clear.
[137] When this is considered in conjunction with the failure to properly afford Ms Schroeter procedural fairness both in relation to the investigation of that incident when undertaken by Ms Magbag and in the decision to dismiss Ms Schroeter and the reliance on matters some years old which had been dealt with (the statutory declaration) or that were no longer within the responsibility and control of Ms Schroeter (matters associated with the Director’s role) to justify dismissal, I have reached the conclusion that the dismissal was unreasonable.
[138] For these reasons I am satisfied that Ms Schroeter was unfairly dismissed.
Remedy
[139] Ms Schroeter does not seek reinstatement. Her evidence is that she had already advised AELC that she would be leaving at the end of 2018 or by Christmas 2018. Ms Schroeter therefore seeks compensation.
[140] Ms Magbag considers reinstatement inappropriate.
[141] I am satisfied in the circumstances that an order for reinstatement is not appropriate, I have therefore considered compensation.
[142] Section 392 of the FW Act states as follows:
392 Remedy—compensation
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), 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.
Misconduct reduces amount
(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.
Shock, distress etc. disregarded
(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.
Compensation cap
(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:
(a) the amount worked out under subsection (6); and
(b) half the amount of the high income threshold immediately before the dismissal.
(6) The amount is the total of the following amounts:
(a) the total amount of remuneration:
(i) received by the person; or
(ii) to which the person was entitled;
(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and
(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.
[143] I am satisfied that compensation should be ordered for Ms Schroeter in lieu of reinstatement.
[144] On the evidence before me I am satisfied that Ms Schroeter would have remained with AELC until 24 December 2018.
[145] I am not satisfied that the parties have properly addressed me on all matters associated with compensation. For this reason I do not intend to decide the compensation matter at this stage but rather will seek further submissions from the parties.
COMMISSIONER
Appearances:
B. Schroeter on her own behalf.
M. Magbag for Arnhem Early Learning Centre Pty. Ltd. T/A Arnhem Early Learning Centre.
Hearing details:
2018.
Darwin:
December 13.
Printed by authority of the Commonwealth Government Printer
<PR704978>
1 Respondent document 11.
2 The first warning is recorded in the notes of the meeting of 19 July 2017 in the Respondent document 11.
3 The final warning is part of the bundle of document K (but dated 5 January 2018), and document T (dated 5 February 2018) in the Form F3.
4 Transcript PN100-3.
5 Respondent document 21
6 Exhibit 13.
7 Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371 at p. 373.
8 Print R4471.
9 Edwards v Justice Giudice [1999] FCA 1836 (23 December 1999) at paras 6–7.
10 Print S4213.
11 Annetta v Ansett Australia Ltd Print S6824.
12 Print S5897.
13 See Form F3.
14 Applicant’s documents, attachment D.
15 Exhibit 8.
16 Exhibit 5.
17 Exhibit 1.
18 Exhibit 5.
19 A signed copy of the affidavit was not provided to the Commission although Ms Schroeter said the text was a copy of the affidavit that she swore to.
20 Transcript PN150.
21 Transcript PN369.
22 See Marijan v Rail Corporation New South Wales T/A RailCorp[2013] FWCFB 215 at [16].
23 Exhibit 3, a file note of the incident made by Ms Schroeter on 9 February 2018.
24 Email of 9 February 2018 as part of document A attached to the Form F3.
25 Email chain commencing 1 March 2018 as part of document A attached to the Form F3 noting that there appears to be substantial correspondence between Mr Suter and the partner in the intervening period of time.
26 Document E attached to Form F3.
27 Document bundle S attached to the Form F3.
28 Transcript PN712.
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