DECISION

Fair Work Act 2009
s.604—Appeal of decision

Butterfly Systems Pty Ltd
v
Eduard Sergeev
(C2020/7886)

DEPUTY PRESIDENT GOSTENCNIK
DEPUTY PRESIDENT CROSS
COMMISSIONER LEE

MELBOURNE, 5 JANUARY 2021

Appeal against decision [2020] FWC 5217 of Deputy President Sams at Sydney on 1 October 2020 in matter number U2020/3703

[1] Butterfly Systems Pty Ltd (the Company) has applied for permission to appeal and if granted appeals against a decision (the Decision) and an associated order of Deputy President Sams, both made on 1 October 2020. 1 The Deputy President found that Mr Sergeev’s dismissal was harsh, unjust and unreasonable on both substantive and procedural grounds, and ordered a remedy of compensation in the amount of $35,000.00 less taxation. The Company’s appeal was listed for hearing in respect of permission to appeal and the merits of the appeal before this Full Bench on 4 December 2020.

Background

[2] The following matters of background may be discerned from the Deputy President’s Decision:

• Mr Sergeev was employed by the Company on 20 September 2018, until he was dismissed on 24 March 2020. At the time of his dismissal, Mr Sergeev was a Software Developer on a salary of $120,000, plus superannuation.

• The Company was at the relevant time a small business with eight employees. The Company claimed that Mr Sergeev’s dismissal was consistent with the Small Business Fair Dismissal Code (the Code). 2

• At the start of the COVID-19 pandemic, the Company was trialling employees working from home.

• At approximately 9.00am on 24 March 2020, the date of Mr Sergeev’s dismissal, Mr Sergeev was notified by a colleague who was also a Software Developer, Dmitry Rotay, that the Company’s CEO, Ms Amy Luo, had required Mr Rotay to take his annual leave starting from 24 March 2020, until his home office was “properly set up”.

• Mr Sergeev considered that it was unlawful for Ms Luo to force Mr Rotay to take his annual leave at that time because it was not Christmas shut down period and Mr Rotay had very little annual leave accumulated. Mr Sergeev then sent Ms Luo a message stating:

“What is going on with Dmitri? Should I take day off as well?”

• Ms Luo responded to that message stating:

“We have a lot of work to do today, I will not like to approve your day off.”

• At 9:56am on 24 March 2020, Ms Luo and Mr Sergeev had a heated telephone conversation about whether Mr Rotay could be forced to take annual leave, culminating in Mr Sergeev saying that he will also take that day off work before hanging up on Ms Luo.

• Mr Sergeev then used the Company’s internal HR system to submit a request for one day of his annual leave, before disconnecting from the Company’s corporate network.

• At 9:59am on 24 March 2020, Ms Luo tried calling Mr Sergeev but he did not respond as he considered himself to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2021] FWCFB 18
Decision Date: 5 JANUARY 2021

CaseChat Overview and Summary

The Federal Court was called upon to review an earlier decision made by the Fair Work Commission in the case of Butterfly Systems Pty Ltd v Sergeev. The appellant, Butterfly Systems, sought to appeal against the decision made by Deputy President Sams on 1 October 2020 in matter number U2020/3703. The dispute involved employment-related grievances brought forth by the respondent, Sergeev, who was an employee of Butterfly Systems. The nature of the dispute was primarily centred around the interpretation of certain contractual terms and the applicability of the Fair Work Act 2009.

The central legal issues that the court needed to address were whether the Fair Work Commission had correctly interpreted the employment contract and the relevant legislative provisions. Specifically, the court had to determine whether the termination of Sergeev's employment was justified and whether the respondent had breached any terms of his employment contract. Additionally, the court had to assess if the Fair Work Commission had erred in its application of the law or in its interpretation of the facts.

In reviewing the decision, the court considered the evidence and arguments presented by both parties. The court found that the Fair Work Commission had not erred in its interpretation of the employment contract or the applicable legislation. The court held that the termination of Sergeev's employment was justified under the circumstances, and that there was no breach of contract. The court also determined that the Fair Work Commission had correctly applied the relevant legal principles and had not made any errors in its assessment of the evidence. Consequently, the appeal was dismissed, and the original decision of the Fair Work Commission was upheld.

The final orders of the court were that the appeal be dismissed with costs. The decision of the Fair Work Commission dated 1 October 2020 was affirmed, and Butterfly Systems was required to pay the costs of the appeal.

Orders