Cameron Myers v Amart Furniture Pty Limited - [2023] FWC 3124

[2023] FWC 3124

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394—Unfair dismissal

Cameron Myers
v

Amart Furniture Pty Limited

(U2023/7466)

DEPUTY PRESIDENT O’KEEFFE

PERTH, 30 NOVEMBER 2023

Application for relief from unfair dismissal – Applicant’s dismissal not harsh, unjust or unreasonable - application dismissed.

On 11 August 2023, Cameron Myers (the Applicant) made an application to the Fair Work Commission (FWC or Commission) under s.394 of the Fair Work Act 2009 (Cth) (FW Act) for a remedy, alleging that he had been unfairly dismissed from his employment with Amart Furniture Pty Ltd (the Respondent). I find that the Applicant’s dismissal was not harsh, unjust or unreasonable and that his application for a remedy should be dismissed. The reasons for my decision are set out below.

Background

The Applicant commenced employment with the Respondent on 26 December 2014. At the time of his termination, he was engaged as the store manager of the Respondent’s Cannington store in Western Australia.

The Respondent operates a system of 30-day accounts for approved business customers where these customers are provided 30 days to pay for goods and are not required to pay a deposit on such purchases. For other customers, the Respondent does not allow 30 days for payment and requires a deposit of at least ten percent of the purchase price when ordering an item.

In or around June 2023, the Respondent’s Risk and Compliance Officer Ms Erin Funaki (Ms Funaki) was tasked with examining an order placed at the Ballina Store in New South Wales for which no deposit had been received. On investigating the order in question, Ms Funaki found that the Store Manager at the Ballina store had selected the 30-day account option in the Respondent’s Retail Management System, entered a full stop in place of a valid Purchase Order, and swiftly de-selected the 30-day account option. The order was placed for a customer who was not an approved 30-day account customer, and no deposit was taken for the order.

The effect of selecting the 30-day account option meant the sale went from the Ballina store’s pending orders screen to its sales board. The sales board displays all the store’s written sales, including cancellations per day. Orders appear on the sales board when the order is confirmed by way of payment, or the 30-day account option is selected for approved customers. When the 30-day account option was deselected moments later, the sales results remained on the sales board for the Ballina store, but the order returned to the pending orders screen.

The Respondent regarded this practice as a clear breach of its operating procedures and as such commenced a wider investigation to determine if the practice was in use in any of its other stores. As part of this investigation, it was determined that the Applicant had used the practice on eight occasions between 1 June 2023 and 21 July 2023. Subsequent investigation found that the Applicant had used the practice on 123 occasions between 1 January 2021 and 1 August 2023.

The Respondent advised the Applicant that it had discovered what it regarded as his misuse use of the 30-day account system and stood him down pending further investigation of the matter. On 26 July 2023 the Respondent interviewed the Applicant about his understanding of and use of the 30-day account system, and his initial lack of truthfulness when confronted with the allegation on 21 July 2023.

On 3 August 2023 the Respondent sent the Applicant a letter outlining its findings and advising him that he was required to attend a meeting on 4 August 2023 where he would be given an opportunity to make submissions as to why his employment should not be terminated. The Applicant attended this meeting and was provided with an opportunity to outline his position. Having considered the Applicant’s further explanation, the Respondent decided to terminate the Applicant’s employment, citing in the termination letter the Applicant’s intentional breach of the 30-day account policy, his attempt to conceal that conduct and his prior breaches of the Respondent’s code of conduct relating to purchases by family members.

Permission to appear

The Applicant represented himself. The Respondent was represented by the National Retail Association Ltd (NRA). As the Respondent is a member of the NRA and the NRA is a registered organisation, under s 596(4)(b)(i) of the Fair Work Act leave to be represented was not required.

Witnesses

The Applicant gave evidence on his own behalf.

Ms Erin Funaki and Mr Daniel Hearn gave evidence on behalf of the Respondent.

Submissions

The Applicant filed submissions in the Commission on 3 October 2023. The Respondent filed submissions in the Commission on 25 October 2023.

Reply submissions were filed by the Applicant on 30 October 2023.

Has the Applicant been dismissed?

A threshold issue to determine is whether the Applicant has been dismissed from their employment.

Section 386(1) of the FW Act provides that the Applicant has been dismissed if:

(a) the Applicant’s employment with the Respondent has been terminated on the Respondent’s initiative; or

(b) the Applicant has resigned from their employment but was forced to do so because of conduct, or a course of conduct, engaged in by the Respondent.

Section 386(2) of the FW Act sets out circumstances where an employee has not been dismissed, none of which are presently relevant.

There was no dispute and I find that the Applicant’s employment with the Respondent was terminated at the initiative of the Respondent.

I am therefore satisfied that the Applicant has been dismissed within the meaning of s.385 of the FW Act.

Initial matters

Under section 396 of the FW Act, the Commission is obliged to decide the following matters before considering the merits of the application:

(a) whether the application was made within the period required in subsection 394(2);

(b)   whether the person was protected from unfair dismissal;
(c)   whether the dismissal was consistent with the Small Business Fair Dismissal Code;
(d)   whether the dismissal was a case of genuine redundancy.

Was the application made within the period required?

Section 394(2) requires an application to be made within 21 days after the dismissal took effect.

It is not disputed and I find that the Applicant was dismissed from his employment on 4 August 2023 and made the application on 11 August 2023. I am therefore satisfied that the application was made within the period required in subsection 394(2).

Was the Applicant protected from unfair dismissal at the time of dismissal?

Section 382 of the FW Act provides that a person is protected from unfair dismissal if, at the time of being dismissed:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

(b) one or more of the following apply:

(i)a modern award covers the person;
(ii)an enterprise agreement applies to the person in relation to the employment;
(iii)the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.

It was not in dispute and I find that the Applicant was an employee.

Minimum employment period

It was not in dispute and I find that the Respondent is not a small business employer, having 15 or more employees at the relevant time.

It was not in dispute and I find that the Applicant commenced his employment with the Respondent on 26 December 2014 and was dismissed on 4 August 2023, a period in excess of 6 months.

I am therefore satisfied that, at the time of dismissal, the Applicant was an employee who had completed a period of employment with the Respondent of at least the minimum employment period.

Modern award coverage

It was not in dispute and I find that, at the time of dismissal, the Applicant was covered by an award, being the General Retail Industry Award 2020.

I am therefore satisfied that, at the time of dismissal, the Applicant was a person protected from unfair dismissal.

Was the dismissal consistent with the Small Business Fair Dismissal Code?

Section 388 of the FW Act provides that a person’s dismissal was consistent with the Small Business Fair Dismissal Code if:

(a) immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened first), the person’s employer was a small business employer; and

(b) the employer complied with the Small Business Fair Dismissal Code in relation to the dismissal.

As mentioned above, I find that the Respondent was not a small business employer within the meaning of s.23 of the FW Act at the relevant time.

I am therefore satisfied that the Small Business Fair Dismissal Code does not apply, as the Respondent is not a small business employer within the meaning of the FW Act.

Was the dismissal a case of genuine redundancy?

Under s.389 of the FW Act, a person’s dismissal was a case of genuine redundancy if:

(a) the employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and
(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

It was not in dispute and I find that the Applicant’s dismissal was not due to the Respondent no longer requiring the Applicant’s job to be performed by anyone because of changes in the operational requirements of the Respondent’s enterprise.

I am therefore satisfied that the dismissal was not a case of genuine redundancy.

Having considered each of the initial matters, I am required to consider the merits of the Applicant’s application.

Was the dismissal harsh, unjust or unreasonable?

Section 387 of the FW Act provides that, in considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the Commission 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.

I am required to consider each of these criteria, to the extent they are relevant to the factual circumstances before me.[1]

I set out my consideration of each below.

Was there a valid reason for the dismissal related to the Applicant’s capacity or conduct?

In order to be a valid reason, the reason for the dismissal should be “sound, defensible or well founded”[2] and should not be “capricious, fanciful, spiteful or prejudiced.”[3] However, the Commission will not stand in the shoes of the employer and determine what the Commission would do if it was in the position of the employer.[4]

Where a dismissal relates to an employee’s conduct, the Commission must be satisfied that the conduct occurred and justified termination.[5] “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.”[6]

In this matter there was consensus between the parties that the conduct which resulted in termination did occur, but the Applicant’s submissions were that the termination was nonetheless unfair.

Submissions

The Applicant’s submissions were not set out in a traditional format and tended to be interspersed with witness evidence. At hearing, I canvassed this issue with the Respondent and it was agreed that I would treat that which was clearly submission as submission, and that which was evidence as evidence.

In the Applicant’s submissions, he raised a number of issues that he claimed contributed to the unfairness of his dismissal. In summary, those issues are:

(a)   He was treated more harshly than other employees who had engaged in the same practice,
(b)   his behaviour did not constitute a serious breach of the Respondent’s code of conduct,
(c)   the practice itself had been taught to him by a more senior employee and had been in use in a number of stores for some time,
(d)   the practice did not involve any risk to the Respondent as goods would not be released until payment was received,
(e)   technically he had not breached the 30-day policy,
(f)    the practice was not conducted in a covert way and did not confer any advantage to him,
(g)   his actions were not willful or malicious,
(h)   the disciplinary process used by the Respondent to deal with the allegations was flawed in a number of ways and the outcome was premeditated,
(i)     the Respondent’s use of a previous warning to buttress its case for termination was unreasonable because it involved a different policy.

The Respondent submitted that there was a valid reason for the dismissal related to the Applicant’s conduct in breaching policy. It submitted that the Applicant was a senior employee in its business, who was fully aware of the Respondent’s policies for the purchasing of goods and in particular, that the use of the 30-day account system was for approved business customers only. It was further submitted that the Applicant was aware of the expectations of the Respondent with regards to adherence to established policies and that breach of policies could be regarded as misconduct.

The Respondent noted that the Applicant had a previous warning for breaching its policies with regard to staff purchases and the securing of discounts and had been made aware at the time that he was counselled for this breach, in July 2023, that further breaches of policy could lead to termination.

In support of its submissions, the Respondent drew my attention to the findings of the Full Bench majority in B, C and D v Australian Postal Corporation T/A Australia Post set out as follows:

“A failure to comply with a lawful and reasonable policy is a breach of the fundamental term of the contract of employment that obliges employees to comply with the lawful and reasonable directions of the employer. In this way, a substantial and wilful breach of a policy will often, if not usually, constitute a “valid reason” for dismissal.”[7]

The Respondent also noted the findings of Deputy President Colman in Xiaoyu Ji v H&T Melbourne One Pty Ltd where the Deputy President found that:

“Ms Ji’s breaches of her contractual obligations constituted serious misconduct and gave the company valid reasons to dismiss her…”[8]

The Respondent also submitted that the Applicant’s initial attempts to mislead with respect to the breaches of policy indicated that the Applicant had demonstrated dishonesty in his dealings with the Respondent during the investigation. The Respondent drew my attention to the findings of the majority of a Full Bench of the Australian Industrial Relations Commission in Streeter v Telstra Corporation Limited, where the majority stated as follows:
“Ms Streeter’s dishonesty with Telstra during the investigation, however, meant Telstra could not be confident Ms Streeterwould be honest with it in the future. The relationship of trust and confidence between Telstra and Ms Streeterwas, thereby, destroyed…
Ms Streeter had an obligation to answer Telstra’s reasonable inquiries honestly.”[9]

Evidence

Before assessing the evidence tendered to the FWC, I should note that at the hearing I found that certain items of evidence tendered by the Parties were inadmissible. Those items from the Applicant deemed inadmissible were all references in his submissions and evidence to conversations that took place in the without prejudice conciliation conferences conducted by the FWC prior to hearing. The items from the Respondent not admitted were Mr Hearn’s notes of meetings held with various employees. Initially, these notes had been tendered in evidence by the Respondent but at the hearing, the Respondent sought to tender the same notes but with the signatures of the employees concerned appended to them. As I regarded these notes as hearsay, I did not allow them into evidence. Further, I note that for the same reason I have had no regard for the original versions as tendered initially by the Respondent.

I should also note that the Applicant tendered into evidence two character references from employees of the Respondent. As I did not find these references to be of any value in my assessment of the facts or merits of this case, I have had no regard for them.

In assessing the evidence, I found it helpful to consider in turn the three main elements identified by the Respondent as its reasons for termination and then the points raised by the Applicant as set out in paragraph [43] above. The first element for the Respondent was the Applicant’s improper use of the 30-day account system.

There was little disagreement between the parties as far as the facts were concerned on this matter. The Applicant freely admitted that he had made use of the 30-day account system in the manner alleged by the Respondent and did not contest the Respondent’s assertion that he had used it 123 times in the period between 1 January 2021 and 1 August 2023. Where the parties were at odds was over the Applicant’s motivations for using the system and the impact of that use on the Respondent’s operations. The Applicant’s evidence was that using the system did not place the Respondent at risk of losing stock, as unlike for approved 30-day account customers, those customers whose orders were improperly entered as 30-day accounts would not receive their purchases until full payment was received. It was the Applicant’s further unchallenged evidence that using the system would not impact upon his sales bonus, as that bonus was payable based on completed orders only. As such, any orders improperly entered as 30-day account orders would only count towards his bonus calculations if and when the customer subsequently made full payment.

I questioned the Applicant as to his motivations for using the system in the manner in which he did. His evidence was that when he was introduced to the system, it was explained that it was a way to “balance out” cancelled orders. If a store had orders that had been cancelled, the cancellation amount would reduce the store’s sales figures. However, this could be offset by entering an order for which full payment had not been received as a 30-day account order, as per the process described above in paragraph four. In other words, that order would appear as though it was a completed sale, albeit that this would only be for the purposes of tracking the store’s sales and not for the purpose of releasing the goods to the customer. The Applicant explained that he used the system in this way because it made sense to him as a means of dealing with the sales pressures that Amart employees were under post-COVID. By offsetting the cancelled orders, he felt the pressure on employees in his store was relieved somewhat.

The Respondent’s evidence was that the improper use of the 30-day account system had some negative impacts on its operations. The primary concern was that the improper use could be used to manipulate a store’s sales figures in the short term. The effect of making the sales figures look better would materialise in the number of staff rostered, as the wages budget allocated to a store was highly responsive to the store’s sales figures. The improper use of the 30-day account system would logically have the effect of bringing sales forward but not creating false sales. As such, I considered whether there would be no real impact of the improper process, as things would even out over time. However, in response to my question in this regard, Mr Hearn confirmed that this manipulation could conceivably mean extra staff were rostered to work at a particular time when in fact, the true sales figures of the store did not support having those people work, and this expenditure on wages could not then be undone at a later time.

This highlighted the Respondent’s more general concern, expressed by Mr Hearn in evidence, that the improper use of the 30-day account system meant that it was not receiving accurate and timely data regarding the operations of the Cannington store. It was Mr Hearn’s unchallenged evidence that the manipulation of sales figures via the improper use of the 30-day account system allowed the Cannington store to avoid having to report directly to him about the status of daily sales and cancellations and the store could thus stay “off the radar”. Mr Hearn also gave evidence that the annual bonus for managers was based on a number of criteria and that a performance review rating of “meets expectations” or higher, which was required to achieve bonus, was more likely to be given to a store manager with consistently strong sales. As such, there was a motivation for the Applicant to demonstrate consistent sales figures. Finally, Mr Hearn postulated that the Applicant may have been motivated to demonstrate consistent sales due to the availability of a more senior role in the Respondent’s operations that may have held some attraction for the Applicant.

The second element of the Respondent’s reasons for termination was its assertion that the Applicant had, at least initially, been dishonest with Mr Hearn about his improper use of the 30-day account system. To support this assertion, the Respondent tendered into evidence a number of documents containing statements made by the Applicant. The first of these documents was an email exchange on 21 July 2023 between the Applicant and Mr Hearn. In this exchange, Mr Hearn asks the Applicant to explain the findings of Ms Funaki which are set out in some detail in the email and wherein she identifies a number of orders where the 30-day account system was used improperly. The Applicant’s response was:

“I’d have to look at the orders but we only use the 30 day account button when we have customers on the list. I’ll have a look Sunday”

Under cross-examination, the Applicant was somewhat evasive about this email and tried to portray it as only using the 30-day account process for customers on the list. However, the Respondent eventually managed to have the Applicant concede that he had used the 30-day button for customers who were not approved for a 30-day account.

The second document was another email exchange on 24 July 2023 between Mr Hearn and the Respondent. The Respondent had established that to make improper use of the 30-day account system, a person would need to use a full stop in lieu of the purchase order number provided by approved 30-day account customers. In the 24 July 2023 document, the Applicant claims he does not know why a full stop (expressed by the Respondent as a “dot”) was being entered for orders that were customers who were not approved for 30-day accounts. Under cross-examination, the Applicant’s initial evidence was that he thought that the exchange was about approved 30-day account customers and this is why he answered as he did. However, further questioning from the Respondent elicited a concession from the Applicant that he knew why the “dot” was being entered.

The third document was the Applicant’s written response to the Respondent’s “show cause” letter. In this document, the Applicant wrote the following:

“On the Saturday when I realized how wrong my actions were I deflected and should of (sic) been honest then and there.”

The Applicant conceded under cross-examination that those were his words.

The fourth document was Mr Hearn’s notes of the meeting held with the Applicant on 26 July 2023. In that document, Mr Hearn records the following exchange with the Applicant regarding the improper use of the 30-day account system:

Mr Hearn: “Surely you must have known the process was wrong?”
Applicant: “Well, Yes, If I am being honest, I knew it was not right.”

In his submissions in reply, the Applicant claimed that Mr Hearn’s notes did not accurately reflect his response, which he claimed was:

“Now this has happened I can see how there is a grey area.”

However, under cross examination, the Respondent drew the Applicant’s attention to his own handwritten notes on the Disciplinary Meeting Record document from 4 August 2023, which was in evidence, where he admitted that he did say “well, yes, if I am being honest, I knew it was not right” and the Applicant conceded that he had said those words. The Applicant further conceded that his submissions in that regard were, as a consequence, not correct.

The fifth document was the Disciplinary Record Meeting document setting out the discussions held with the Applicant on 4 August 2023. That document included a summary of the Applicant’s interview with Mr Hearn on 26 July 2023. Mr Hearn had recorded that the Applicant had conceded in that discussion that when first questioned about the issue, he had thought:

“Fuck me, that was wrong”

and wanted to avoid being caught. In his reply submissions, the Applicant claimed not to have said that he wanted to avoid being caught. In cross-examination, the Respondent asked the Applicant if he had addressed this alleged inaccuracy in the document dated 4 August 2023 when given an opportunity to do so, noting that he had made a detailed written response at the time. The Applicant claimed that while he had refuted it in the meeting, his full responses were not recorded by the Respondent. In response, the Respondent drew the Applicant’s attention to his signature on the document dated 4 August 2023, confirming it as a true and accurate record, and the Applicant conceded it was his signature.

The third element of the Respondent’s reasons for termination was his previous warning for breaches of the Respondent’s sales policies with respect to staff sales. The Respondent tendered into evidence a Disciplinary Meeting Record document dated 20 July 2023, wherein the Applicant is warned about his improper behaviour. Specifically, the Applicant had entered a sale for his wife, contrary to the Respondent’s policies and in breach of a verbal instruction given to him on a previous occasion. Further, the sale was entered with a deposit that was lower than the minimum deposit required under the Respondent’s policies. It was recorded in that document that the Applicant was on notice that:

“Failure to follow business policies or direction again could lead to further disciplinary actions up to and included termination.”

Under cross-examination, the Applicant conceded that his signature appeared on that document, and he did not object to any of its contents.

I now turn to the evidence related to the Applicant’s submissions regarding why his termination was unfair. The first submission is that the Applicant was treated more harshly than other employees who had engaged in the same practice with the 30-day account system. In his submissions, the Applicant drew my attention to the outcomes of disciplinary processes conducted with other employees of the Respondent who he believed had engaged in the same process. For a number of these employees, the Applicant submitted copies of their Disciplinary Meeting Record documents into evidence, and these documents were not challenged by the Respondent. As there is no particular purpose served by naming the various employees, I will summarise the outcomes, as follows:
Outcome
Employee 1     First warning
Employee 2     First and final warning
Employee 3     No action recorded

In addition, the Applicant claimed that other outcomes included:

Employee 4     First and final warning
           Employee 5     First and final warning
           Employee 6     Outcome uncertain but still employed
           Employee 7     Terminated with notice

In his evidence, Mr Hearn confirmed that Employee 4 had not been terminated and that Employee 7 had been terminated. In response to my questions, he advised that Employee 7 had been terminated solely for improper use of the 30-day account system, but that Respondent had found that the improper use occurred on a large number of occasions.

The second submission from the Applicant was that his improper use of the 30-day account system did not amount to a serious breach of the Respondent’s code of conduct. While the Applicant did include a copy of the Respondent’s “Code of Conduct Policy” document with his initial application, he did not expand upon or otherwise explain his submission that his actions did not constitute a breach of that policy. As the policy was tendered into evidence by the Respondent, I have examined it to determine which parts of it might be said to be relevant to the improper use of the 30-day account system. From that examination, I determined that the following sections of the policy are relevant:

“1.1. General Expectations

All Team Members are expected to abide by the following general expectations of conduct:

…

(e) to comply with all reasonable requests from Amart Furniture management and assist and cooperate with any workplace investigations relating to misconduct as applicable;…”

“1.2. Professionalism

…

(c) Managers and Senior Managers at all levels are expected to ensure that they uphold the behavioural standards expected by the business. Managers must ensure that the Team Members who report to them also do the same by establishing a culture that is reflective of Amart Furniture standards and values…”

“2.3. General Misconduct

(a) General Misconduct is any form of misconduct determined to be inappropriate and not in line with Amart Furniture mission/vision statement, values or standards, and includes (but is not limited to) the following examples:

(i) breach/s of Amart Furniture policies, procedures or guidelines, including when handling merchandise/product samples or Amart Furniture funds including cash, credit/debit cards, or exchanged/returned product;…”

“2.4. Serious Misconduct

(a) At law, serious misconduct takes its ordinary meaning – that is, misconduct so serious that continued employment is not tenable – and includes (but is not limited to) the following:

…

(vii) any act of dishonesty that could negatively affect the best interests of Amart Furniture including failing to report, or aiding and abetting, another Team Member engaged in an act of dishonesty;…”

The third submission from the Applicant was that the practice itself had been taught to him by a more senior employee and had been in use in a number of stores for some time. It was the Applicant’s evidence that the process had been taught to him by a Ms Gina Stewart (Ms Stewart) who had been, at the time, his manager. Ms Stewart remains an employee of the Respondent. I questioned the Applicant as to whether he could be mistaken in his assertion that Ms Stewart had taught the process but he remained steadfast in his position that it had indeed been Ms Stewart. The evidence of Ms Funaki was that she had questioned Ms Stewart and was given the impression that Ms Stewart was unaware of the process. Mr Hearn’s evidence on this matter was that he had asked Ms Funaki to complete an audit of Ms Stewart’s transactions to determine if she had used the process, and this audit had revealed no such use in the period 1 January 2014 to 8 August 2023.

The fourth submission from the Applicant was that the improper use of the 30-day account system did not involve any risk to the Respondent as goods for non-30-day account customers that were entered improperly into the system as 30-day account orders could not be released until full payment was received. The Respondent did not seriously challenge this notion in its evidence or in cross-examination of the Applicant.

The fifth submission from the Applicant was that technically, he had not breached the 30-day policy. Again, this was a submission where the Applicant did not expand or explain his reasoning in any detail, nor provide any evidence of why I should consider that this was the case. In terms of evidence as regards whether he had breached the policy or not, I note the details of the Applicant’s cross-examination by the Respondent set out in paragraphs 54 and 55 above.

The sixth submission from the Applicant was that the practice was not conducted in a covert way and did not confer any advantage to him. The unchallenged evidence of the Applicant was that the orders that were improperly entered as 30-day account orders were visible to Mr Hearn when he conducted audits of stores. This matter was not canvassed during the hearing in any detail. However, I note that with respect to the practice being conducted in a covert way, the Respondent took some considerable issue with the Applicant’s initial attempts to cover up the use of the process, as set out in paragraphs 54 to 58 above. As to the conferral of advantage, the Applicant’s evidence as set out above in paragraphs 50 and 51 suggests there was no advantage. I note, however, Mr Hearn’s evidence, set out in paragraph 53 above, which indicates that the Respondent’s view was that there was advantage conferred upon the Applicant.

The seventh submission from the Applicant was that his actions were not willful or malicious. Again, this submission received little attention in the Applicant’s evidence or submissions at hearing. The Oxford English Dictionary online[10] service defines willful as follows:

(a) willful, in wilful, adj., adv., & n.

Done on purpose or wittingly; purposed, deliberate, intentional; not accidental or casual.

The Applicant’s evidence regarding his improper use of the 30-day accounts system, as set out above, was that he was aware of what he was doing, and his use was not accidental.

Turning again to the Oxford English Dictionary online[11] service, malice is defined as follows:

(b) malice, n.

The intention or desire to do evil or cause injury to another person; active ill will or hatred. In later use also in weakened sense: mischievous…

The Applicant’s evidence as set out above is that in his improper use of the 30-day accounts system there was no intent to cause injury to the Respondent. While the Respondent’s evidence was that the Applicant’s actions had the potential to do some harm, it is clear that the Respondent has not provided any evidence that the Applicant was motivated by causing harm to the Respondent’s business.

The eighth submission from the Applicant was that the disciplinary process used by the Respondent was flawed and the outcome was premeditated. Particularly, the Applicant drew attention to the following:

(a)   He was not provided with the Code of Conduct or Accounts policy before, during or after the disciplinary meetings,
(b)   the stand down notice was issued verbally and not formally,
(c)   he had not been granted a meeting with Mr Hearn, as per his request, prior to being stood down,
(d)   he had asked if he should resign but this was refused,
(e)   a number of the issues raised with him at the meeting on 4 August 2023 were minor issues that had previously been resolved in discussions with Mr Hearn,
(f)    the notes of his meeting with Mr Hearn on 26 July 2023, as presented at the meeting on 4 August 2023, were not accurate and shortened his responses to “show a better light for (Mr Hearn’s) questions”,
(g)   at the meeting on 4 August 2023 the paperwork for his termination was already typed and printed, suggesting premeditation.

As was the case with other submissions, the Applicant chose not to pursue some of these issues at any great length in his cross-examination. In reviewing the evidence provided, it is clear that the Applicant’s evidence with regard to items (a), (b), (e), (f) and (g) was not challenged by the Respondent. In his cross examination of Mr Hearn, the Applicant established that his evidence regarding item (c) was accurate. Under cross-examination, the Applicant conceded that with respect to item (d), the interaction regarding his resignation had been somewhat more nuanced than presented in his evidence. He had asked the Respondent if the process was being drawn out so he would resign, and the Respondent had denied this and indicated that it was simply seeking further feedback.

The final submission from the Applicant was that the Respondent’s use of a previous warning to buttress its case for termination was unreasonable because it involved a different policy. The warning in question was in evidence before the FWC and there was no dispute between the parties that it was a warning for breach of the Respondent’s Team Discount Policy. The breach involved the Applicant entering a sale for his wife, contrary to the Staff Sales procedure, and referenced a previous verbal instruction to the effect that the Applicant should not process sales for his wife.

Consideration

With respect to the Applicant’s improper use of the 30-day account system, there is as noted above, little dispute as to whether this occurred. Rather, the dispute was about the seriousness and intent of that improper use and its impact. In considering the evidence of the Applicant and the Respondent, I find that the Applicant’s improper use of the 30-day account system was primarily for his own benefit. While he may not have had any material gain in terms of his sales bonus, I find that his use of the system to ensure that his store’s sales figures looked healthy and consistent was to ensure he reduced pressure on all employees in the store, including himself. The other advantage for the Applicant would be that he personally avoided what may be difficult conversations with Mr Hearn. I also accept Mr Hearn’s evidence that the Applicant would be advantaged in terms of his performance review by having steady sales results and I do not accept that the Applicant would have been unaware of this.

I further find that notwithstanding how it is that the Applicant came to be aware of the ability to make improper use of the 30-day account system, he could not have been unaware that such use was not in accordance with official policy and would have provided inaccurate figures to the Respondent. The Applicant clearly believed that there was pressure on the Respondent’s employees to make sales. He was also aware that his wages budgets were impacted by sales. It is not credible to suggest that he was unaware that his manipulation of the sales figures would impact his wages budgets in such a way as to be inconsistent with the intentions of the Respondent. The Applicant was a store manager and in a position of trust. It was incumbent upon him to act with honesty and integrity and to act in the best interests of his employer. In acting as he did, I find that he did not fulfill these obligations.

The second element of the Respondent’s reasons for termination was the Applicant being dishonest about his misuse of the 30-day accounts system when first questioned by Mr Hearn. In assessing the evidence, I find that the Applicant was dishonest when initially questioned by Mr Hearn and that he tried to cover up what had been happening. While this initial reaction may have been hasty and panicked, it was nevertheless clear that the Applicant’s first course of action was to be dishonest. While it is not disputed that he eventually conceded that he had been misusing the 30-day account system, it is the case that under cross-examination, the Applicant sought to obfuscate somewhat on the issue of his dishonesty and it was only as a result of methodical questioning by the Respondent that he was finally forced to concede. The Respondent’s Code of Conduct makes it clear that employees are required to cooperate with the Respondent when it is conducting an investigation. While the Applicant may have complained that he was not provided with a copy of the Code during the disciplinary process, and that it may have been some years since he had training in the Code, I am not persuaded that this is relevant. As store manager, he was responsible for maintaining the Code in his workplace and so to suggest, by implication, that he was somehow unclear on the code is not credible. Further, a store manager should not need a written code of conduct to direct them to be honest.

The third element of the Respondent’s reasons for termination was a previous warning issued to the Applicant regarding sales to a family member. Again, there is little dispute that the warning was given, and that the Applicant had engaged in the alleged behaviour. The Applicant sought to downplay this warning on the basis that it was for an unrelated breach of the Respondent’s policies and that the breach dealt with in the warning had not re-occurred. However, the breach, coming as it did after a verbal instruction not to engage in any further instances of processing sales for family members, demonstrated that the Applicant could be reasonably said to be, at the very least, inconsistent with his application of the Respondent’s policies regarding purchases. As a store manager, I find that this is not acceptable, as the Applicant should have been a role model for other employees. It is true that the Applicant did not engage in any further breaches of the family member sales procedures and, based on the evidence submitted by Ms Funaki, did not engage in any further improper use of the 30-day account process during his employment after being given the warning about family member purchases. What is also true is that this employment period was limited to two days.

Nevertheless, this may raise the issue, which was inferred by the Applicant in his closing submissions, that perhaps it ought be viewed that the Applicant had not committed any further breaches of policy in the period after being warned and, as such, the warning cannot be relied upon to sustain his termination. I do not accept that this is a reasonable characterisation. I find that the Respondent was entitled to rely on the fact that the Applicant had previously engaged in serious breaches of its sales policies while holding a managerial position and that this would have given the Respondent cause to have serious concerns about the Applicant’s suitability for a position of trust.

I now turn to the Applicant’s submissions about why the dismissal was unfair. The first contention is that he was treated more harshly than other employees in a similar position. I find that this is not the case. I find that while the Respondent implemented a number of different disciplinary outcomes, it appears to have taken – correctly – an approach of assessing each case on its merits. In some instances, the employee had no prior warnings and confessed immediately to misusing the 30-day account system. As a result, the Respondent applied a lesser penalty of a first and final warning. Another employee had been more prolific in his misuse than the Applicant but had no prior warnings. As a result, he was terminated with notice. It appears from the evidence that the Applicant received the most serious punishment because he had been a fairly prolific in his misuse but had been initially dishonest about that misuse and had a prior warning for what was a reasonably serious breach of the Respondent’s purchasing policies.

The Applicant’s second contention was that his actions did not constitute a serious breach of the Respondent’s Code of Conduct policy. The relevant sections of that code are set out above at paragraph [63]. I find that the Applicant’s behaviour does constitute a serious breach of the code. I note again that the Applicant was a store manager and in a position of significant trust. Further, he was responsible for ensuring that employees at his store complied with the Code of Conduct. Turning to the relevant provisions of that code, I find that the Applicant was in breach of section 1.1(e) in that, at least initially, he did not fully assist and cooperate with a workplace investigation into misconduct. I find that the Applicant was in breach of section 1.2(c) in that by manipulating sales figures and then being initially dishonest about his involvement, he did not uphold the behavioural standards expected by the Respondent. I find further that the Applicant was in breach of section 2.3(a)(i) in that he breached the Respondent’s policies with respect to use of its 30-day accounts. Finally, I find that the Applicant was in breach of section 2.4(a)(vii) in that he engaged in an act of dishonesty. To reiterate, all of these breaches were committed while in the position of store manager and I find that the Applicant’s position of trust contributes to the seriousness of the breaches.

The third contention by the Applicant was that the improper use of the 30-day account system had been taught to him by a more senior manager and that it had been going on in the business for some time. I do not find this line of argument to be persuasive. While it may well be that the improper practice was taught to the Applicant by a more senior manager, he was himself in a senior management position at the time of his dismissal and fully responsible for his own actions. He could have chosen not to use the system improperly and to ensure it was not in use by other employees in his store. Instead, he chose to continue misusing the system and allowed its use by other employees. As a store manager, it was incumbent upon him to exercise good judgement and comply with policy. It is not a defence to claim that he had been taught to use the 30-day account system improperly when he was a junior employee. It is also not a defence to claim that the improper use of the system had been in wider use in the Respondent’s business for some time. It is clear that the Respondent did not condone the improper use and has taken serious measures to ensure that such improper use ceases.

The fourth of the Applicant’s contentions was that the improper use of the 30-day account system did not involve any risk to the Respondent as goods for non-30-day account customers that were entered improperly into the system as 30-day account orders could not be released until full payment was received. While I accept that this is true, I found above that the Applicant’s improper use was for his own benefit and had the effect of providing inaccurate sales data to the Respondent. As the Respondent relies upon such sales data for the budgeting of wages, there was a negative impact on the Respondent, albeit that it was not the risk of stock being released without payment.

The fifth contention from the Applicant was that he had not in fact breached the 30-day account policy. I find that this contention from the Applicant was an attempt to take an unreasonably technical view of what constituted a breach. It could perhaps be said that he had not breached the 30-day policy with any customers who were authorized account holders and permitted under the Respondent’s policy to use the system. However, he had clearly misused that 30-day account system by utilising one of its features to create a false sales result on an order that should not have had any part of the 30-day account system applied to it. His argument that he had not breached the 30-day account system is little more than sophistry.

The sixth of the Applicant’s contentions was that the practice was not conducted in a covert way and did not confer any advantage to him. I have previously dealt with the issue of the misuse not conferring any advantage. While it does appear to be the case that the misuse was available for the Respondent to find, as indeed it did when it went looking, I do not find that this is a sufficient element on which to base a claim that the termination of the Applicant was unfair. In support of this, I note that the Applicant’s first response when the improper use was discovered was to try to mislead the Respondent about that misuse.

The seventh contention from the Applicant was that his actions were not willful or malicious. I find that while his actions could not be said to be malicious, they were willful, in that he deliberately and knowingly misused the 30-day account system. In weighing up the Applicant’s arguments, I do not find that the absence of malice confers any advantage on him.

The final limb of the Applicant’s defence is that he was not provided with a fair process. I will address each of the elements of the process that he regarded as unfair in turn. Firstly, he was not provided with the Code of Conduct or Accounts policy before, during or after the disciplinary meetings. I am not persuaded that this is particularly relevant. In the first instance, the Applicant was responsible for implementing and enforcing the code as part of his role as store manager. As such, it is reasonable to expect him to be familiar with its contents. Secondly, the alleged breach of policy was quite specific and so there should be no suggestion that the Applicant would be unaware of what the allegation against him was such that he needed to consult the code.

The Applicant’s second concern was that the stand down notice was issued to him verbally and not formally. I do not regard this as relevant. In the circumstances, it was open to the Respondent to stand the Applicant down with pay during its investigations. The obligation on the Respondent would be to inform the Applicant of this. While doing so in writing might avoid any later disputes about exactly what was said, I do not think the Respondent is required to provide notice of stand down in writing.

The third concern was that the Applicant had not been granted a meeting with Mr Hearn, as per his request, prior to being stood down. Again, I do not regard this as relevant. While it may have been the Applicant’s preference to have such a meeting, the Respondent has not acted improperly by not granting such a meeting. It appears that the Respondent has instead simply gone about conducting its investigations according to its own timetable and held meetings with the Applicant when it believed it was appropriate to do so. There is no evidence before me that the Applicant has been denied an opportunity to explain his position as a result of not being granted a meeting at the time of his preference.

The fourth concern was that the Applicant had asked if he should resign but the Respondent had refused this request. Based on the evidence it appears that rather than asking to resign, the Applicant asked the Respondent if it was attempting to secure his resignation, to which the answer was no. As such, I do not find that there is any merit in this concern.

The fifth contention from the Applicant related to the meeting held on 4 August 2023. Specifically, the Applicant took issue with the Respondent asking him about a number of issues that he regarded as minor and having been resolved at a previous time. While including such issues in the discussion is perhaps unwise in that it has the potential to distract from the main concerns, I find that the issues relevant to his termination were raised with the Applicant at the meeting on 4 August 2023 and so from a procedural viewpoint, I do not think there is any merit in the Applicant’s contention.

The Applicant’s sixth contention was that the notes of his meeting with Mr Hearn on 26 July 2023, as presented at the meeting on 4 August 2023, were not accurate and shortened his responses. The Applicant claimed that this was to “show a better light for (Mr Hearn’s) questions”. Having regard for the evidence submitted and the cross-examination of the Applicant, it would appear that the notes were something of a summary of his responses, rather than a verbatim report. I do not find that this is an unusual practice. Perhaps more at issue would be if the Applicant’s responses were recorded in such a way as to misrepresent what he had said to the advantage of the Respondent. The Applicant did not particularise his assertions about inaccuracies save perhaps for the issue of his response about misuse of the 30-day account system, as canvassed in paragraph [59] above. As I noted in that paragraph, under cross-examination the Applicant conceded that Mr Hearn’s notes as provided to him on 4 August 2023 did accurately portray what he had said in that earlier meeting. In any case, the Applicant had the opportunity to address any misrepresentations in the meeting on 4 August 2023. In summary, I do not find that this contention is relevant.

The final contention from the Applicant was that at the meeting on 4 August 2023 the paperwork for his termination was already typed and printed, suggesting premeditation. I do not find this to be the case. The sequence of events was that the Applicant attended a meeting with the Respondent on 26 July 2023. At that meeting, he was asked about his misuse of the 30-day account system, and his attempts to mislead the Respondent when confronted with the evidence. Having considered his responses, the Respondent wrote to the Applicant on 3 August 2023 and asked him to attend a “show cause” meeting. It is clear from the contents of that correspondence, which was in evidence, that the Applicant was advised that the Respondent had formed a view, based on his responses in the meeting of 26 July 2023 and other investigations, that he had engaged in serious misconduct. Further, the correspondence advises the Applicant that the Respondent is considering terminating his employment. The meeting on 4 August 2023 was explained to the Applicant as an opportunity for him to provide reasons why he should not be terminated. In such circumstances, where termination has been foreshadowed, I do not find that even if the termination letter was indeed pre-prepared, this indicates premeditation. Furthermore, the Applicant conceded in cross-examination that following the conclusion of his submissions in the meeting on 4 August 2023, the Respondent took some twenty to twenty-five minutes to consider those submissions before advising him that he was terminated. For the reasons above I do not find that there was anything of concern in the Respondent having made preparations to affect a termination if the Applicant was unable to convince it to maintain his employment.

In summary, for the reasons set out above, I find that the Respondent had a valid reason to terminate the Applicant’s employment and I do not accept that the Applicant’s contentions about why the termination was unfair to have sufficient merit to warrant any change to that conclusion.

Was the Applicant notified of the valid reason?

Proper consideration of s.387(b) requires a finding to be made as to whether the applicant “was notified of that reason”. Contextually, the reference to “that reason” is the valid reason found to exist under s.387(a).[12]