Caroline Pedersen v Pro Help Australia Pty Ltd - [2022] FWC 1666

[2022] FWC 1666

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394—Unfair dismissal

Caroline Pedersen
v

Pro Help Australia Pty Ltd

(U2021/11103)

DEPUTY PRESIDENT LAKE

BRISBANE, 28 JUNE 2022

Application for an unfair dismissal remedy – the Applicant was unfairly dismissed – compensation awarded

On 2 December 2021, Ms Caroline Pedersen (Applicant) made an application to the Fair Work Commission (Commission) under s.394 of the Fair Work Act 2009 (Cth) (FW Act) for a remedy, alleging that she had been unfairly dismissed from her employment with Pro Help Australia Pty Ltd (Respondent). The Applicant seeks compensation.

As the matter could not be resolved by conciliation, directions were issued for the filing of material. A hearing was listed for 6 May 2022 and on 10 May 2022, at which the Applicant sought to be represented. I was required to consider whether permission ought to be granted under s.596 of the Act. Given the volume of evidence and submissions provided by the parties, number of witnesses and the requirement for cross examination involved in considering whether the Applicant’s dismissal was unfair, I was satisfied that it would be of use to the Commission – and would not unduly prejudice the Respondent – to have the assistance of the Applicant’s legal representative. I was also satisfied that the presence of the Applicant’s representative would enable the matter to be dealt with more efficiently. Accordingly, I allowed Ms Leanne Tacey of Anderson Gray Lawyers to represent the Applicant.

Section 396 of the Act requires that I be satisfied of four matters before considering the merits of the Applicant’s application. Neither party disputed, and I am satisfied, that the Applicant made her application within the 21-day period required by s.394(2) of the Act, that she was a person protected from unfair dismissal (as she earned less than the high-income threshold), that her dismissal was not a case of genuine redundancy and that the Respondent is not a small business to whom the Small Business Dismissal Code applies.

Events leading to Applicant’s dismissal

The uncontested factual background to the matter is as follows:

“Around June 2020 the Applicant commenced permanent full-time employment with the Respondent as the Queensland Development Manager responsible for the management of the Support Co Ordination Program NDIS.

An employee Mr Mark Ffinch was hired following the Applicants recruitment and his statement formed part of the allegations however he was unable to attend as a witness and I have not had regard to this evidence as it was not able to be tested – I will therefore not spend time on this aspect of the matter

The Applicant took approved leave from the 25 -29 October 2021.

On the 1 November 2021 Mr Ventaloro requested a meeting with the Applicant which lasted for approximately 2 hours. Several allegations were raised. On the 3 November 2021 Mr Ffinch resigned.

On 4 November 2021 a meeting took place at which time there were some heated exchanges following which an apology was issued to the Applicant by Ms Ventaloro.

The following day 5 November 2021, the Applicant had a rostered day off and did not attend the workplace and later that day she received a show cause letter indicating that she was stood down with pay and there were 6 allegations which had been substantiated and requested a written response as to why her employment should not be terminated by 9 November.

On the 9 November 2021, the Applicant sent an email denying the allegations and requested further information regarding the allegations in order to provide a fulsome response. The Respondent replied and declined to provide further details, he did not accept the Applicants denials and offered an extension of one more day for the Applicant to provide any further evidence to be considered.

On 10 November 2021, the Applicant complained about the limited details of the allegations and his refusal to provide the specifics of the allegations in order for her to provide an adequate response. She further objected on the basis that the Respondent had already substantiated the allegations without her input or comments. She further reiterated her denials of any inappropriate conduct.

On 11 November 2021 by email directed the Applicant to attend a meeting the following day with the external HR Advisor.

On 12 November, the Applicant attended the meeting. Several matters were discussed including a potential offer to settle the matter. No discussions regarding the allegations occurred

An offer to settle was extended and not accepted later that day

On 12 November in the evening the Applicant received a letter of termination giving the reason for the dismissal as employment misconduct.”

The case for the Applicant

In brief, the Applicant’s case is that the termination of her employment was not founded on a valid reason, that there was no misconduct and any allegations and investigation were significantly flawed and not of the standard to either substantiate the allegations or to discipline the Applicant. The Applicant claims her dismissal was a result of Ms Ventaloro’s emotional sensitivity and inability to manage that led her to be a driving force in the Applicant’s dismissal. On that basis, she asserts that she was unfairly dismissed and seeks a remedy.

The Applicant gave evidence on her own behalf. She also called Kimberlee Graham as a witness.

Evidence of the Applicant

The Applicant says that prior to commencing employment she had spent six months, two or three days a week, on a voluntary basis helping to assist the Respondent undergo a certification audit.

A Mr Mark Ffinch was employed by the Respondent and there arose several issues that the Respondent claimed were allegations against the Applicant and were put to the Applicant as substantiated allegations

Between 25 and 29 October 2021, the Applicant took approved annual leave.

On 1 November 2021, The Applicant was called into a meeting in the boardroom around 9.30am. Mr Ventaloro stated that he had feedback from three employees that the Applicant had made disrespectful comments about himself and Ms Ventaloro.

The Applicant denied any disrespectful comments about Mr or Ms Ventaloro and stated that she had made statements about the financial viability of a program. The Applicant requested further evidence of the allegation which the Respondent refused to provide.

The Applicant stated to the Respondent that any comments regarding Ms Ventaloro were said directly to her and further that the only negative comments regarding Mr Ventaloro had been stated by Ms Ventaloro and provided an example.

The Respondent informed the Applicant that this matter was serious and that there was an investigation. The Applicant stated that if this was a formal process then there was an appropriate and fair way for the matters to be dealt with, which included documenting all the communications and allegations and to have the opportunity to respond.

An issue arose during a meeting on 4 November 2021 where some heated words were exchanged between Ms Ventaloro and the Applicant over a notebook and meeting notes. Following the matter, a written warning was provided from Mr Ventaloro to Ms Ventaloro with the Applicant copied. There was a further apology to the staff from Ms Ventaloro and a written apology to the Applicant.

On 5 November 2021, a show cause letter was issued by the Respondent with 6 allegations which the Respondent said had been substantiated with a written response due on the 9 November 2021. The letter stated as follows:

“Breach of Confidentiality

We have reasonable evidence that you have breached confidentiality on a number of occasions relating to employee remuneration – specifically the remuneration that Mark Ffinch is receiving at Pro Help Australia. This occurred when you disclosed Mark’s pay rate openly to both Kimberlee Graham and Bec Peart.

This behaviour constitutes a breach of your Contract of Employment and the Code of Conduct, and is inconsistent with the performance of your duties as a Senior Manager within our Organisation.

Victimisation of an Employee

It is alleged that you have victimised an employee, Mark Ffinch, in the meeting on 1 November 2021. During this meeting you advised that you were aware that Mark had raised grievances with Renee and Paul and then told him that he was not to have any further discussion with us. This resulted in Mark feeling intimidated, threatened and victimised for having raised legitimate workplace concerns.

This behaviour constitutes a potential breach of the Code of Conduct and Bullying and Harassment policy.

Exclusory behaviour

In holding a ‘culture discussion’ with only 2 team members you have excluded other members of the team as well as the Director and senior management. As discussed in our meeting on Monday 1st November 2021, we see this behaviour as inappropriate and unbefitting a senior manager. Your response to this in the meeting showed us that you have no regard for our direction on this and that you fail to understand or accept the inappropriate nature of this conduct.

This behaviour is inconsistent with the performance of your duties as a Senior Manager within our organisation.

Failure to maintain privacy and confidentiality

On Thursday 4th November, Renee Ventaloro observed a notepad on the boardroom table during a meeting with other staff present. The notepad was open and Renee was easily able to read the content of the notes which were easily identifiable as negative comments about cultural elements of the workplace. These notes could have been read by others in the meeting and could have caused considerable angst and damage to the team and individuals in the team.

This behaviour is inconsistent with the performance of your duties as a Senior Manager within our organisation.

Disparaging comments about Management

We have reasonable evidence that on a number of occasions, you have made disparaging remarks about both Renee and I. While you denied this in our meeting on 1 November 2021, our investigation has shown consistent reports from employees that this has occurred and as such, we believe that it is reasonable to substantiate that this has occurred.

This is a serious breach of our trust as well as a breach of the Code of Conduct.

Abusive and disparaging behaviour towards management

On Thursday 4 November 2021, in the public setting of the office, you said “I fucking don’t believe this Renee, grow up!” In response to Renee’s concerned reaction to the notepad and her needing to raise with you the nature of the comments on the notebook she had observed. When asked to share minutes notes from a meeting, you refused and told Renee that she could “Get them when the rest of the staff get them at Monday’s meeting”.

This behaviour constitutes a potential breach of the Code of Conduct and Bullying and
Harassment policy.”

The Applicant was stood down on pay and reminded of the confidential nature of the matter. Further the Applicant was on notice that disciplinary action was being considered up to and including termination of employment.

The Applicant provided a response as follows:

“Please see below my response to the letter received in regard to allegations pertaining to myself and my supposed negative conduct in the workplace.

I have read the allegations and for me to provide specific, factual detailed responses to these allegations I will require the evidence that you state you have in your possession that substantiates these six allegations.

In each of the points you have raised I have serious concerns as to how any of these allegations are able to be substantiated.

I further request that you provide me with evidence you acquired during your investigation to ensure that I am responding to fact only and not workplace rumours or gossip and so I’m afforded the opportunity of Natural Justice.

I absolutely refute these allegations and am more than happy to provide any information you may be seeking after it can be demonstrated to me that you have carried out a thorough investigation and established sufficient evidence prior to issuing me with a Show Cause letter. Further to this the consequences you have indicated that I may be subjected to as a disciplinary outcome if found guilty of these allegations will have a significant impact on me.

One of your stated outcomes that I may face as part of this disciplinary process includes dismissal and as such, I would hope that your processes and investigations have been fair and equitable.

If I am to face a disciplinary outcome of dismissal with the current lack of evidence that I have been provided I will most certainly be lodging a formal complaint with Fair Work Australia. I will provide Fair Work Australia with all relevant information to fully investigate this matter if this is to occur. I request that you adhere to a recognised disciplinary procedure in accordance with legislative guidelines.

Until this disciplinary process is finalised can you please confirm for me whether I’m allowed to return to my workplace or not so that there is no confusion or misunderstandings, I noted in your show cause letter that that I’m not to attend my workplace or speak to certain persons including but not limited to staff, clients, and stakeholder. Your letter further goes on to say I must be available to attend work, meetings, or interviews etc. Can you please elaborate on this more specifically as I find it extremely confusing as to how I can avoid the stated persons and somehow be available to attend the work tasks outlined without conflicting one of your directions. This is to ensure that I am not unknowingly placing myself in a position that you deem may require further disciplinary action while still being subject to the current disciplinary process.

I’ll await your response inclusive of evidence of your investigations and outcomes before providing any further information to these allegations.”

The Respondent replied, declined to provide any further information regarding the allegations, did not accept the Applicant’s denials and gave the Applicant till midday on 10 November 2021 to provide any further evidence. On 10 November 2021, the Applicant complained about the lack of specific detail in the allegations, further the Applicant complained that the Respondent had substantiated the allegations without hearing from herself and she once again denied the allegations.

On 11 November 2021, the Respondent requested the Applicant attend a meeting with the external HR consultants (Focus HR) to discuss options for the future. The Applicant attended the meeting on 12 November 2021 and at that meeting the Applicant states that she was offered to opportunity to resign or put an offer to the Respondent to settle the matter. Following this meeting the Respondent, through the external HR consultant, made a without prejudice offer which the Applicant rejected.

On 12 November in the evening the Respondent issued a letter of termination on the basis of misconduct and was paid two weeks in lieu of notice

The relevant portions of the letter are extracted below:

“I am writing to you about the termination of your employment with Pro Help Australia.

I refer to our letter of 5 November 2021 in which you were given the opportunity to provide a response to our concerns.

You replied on 9 November 2021 however did not provide detail in your reply. We provided you a further opportunity and additional time to respond by 10 November 2021. In your response you refuted the concerns without providing any information for us to consider to counter the concerns raised. As such a decision was made on the information available to us and we confirm our decision is to terminate your employment.

The reasons for termination following our investigation and objective consideration of all the information available to us are:

1.Behaviour inappropriate for a senior manager in our organisation
2.Failure to maintain privacy and confidentiality
3.Disparaging comments of a highly disrespectful nature made about both Paul and Renee Ventaloro to other employees

The behaviour addressed in this process constitutes a serious breach of trust, breach of Code of Conduct, and your Contract of Employment.

We have attempted to communicate and deal in good faith, however feel that this has now reached a point where the relationship has become untenable and we are unfortunately in a position where we believe that the only option is to terminate your employment.

Based on your length of service, you are entitled to a period of notice of 2 weeks, however we will pay you in lieu of notice and as such, your employment with us will cease immediately.

You will be paid your accrued entitlements and any outstanding pay, up to and including your last day of employment. Your pay slip for termination pay will be forwarded to you in due course.”

The Applicant claims that prior to the Respondent’s decision being made to terminate her employment, she was not given a proper opportunity to have a fair investigation, be presented with the evidence, address the allegations and respond with respect to the severity of termination as the penalty for her conduct.

Evidence of Kimberlee Graham

Ms Graham reported directly to the Applicant and has since left the organisation. Ms Graham confirmed the Applicant’s statement regarding the 4 November meeting and the subsequent disruption by Ms Ventaloro regarding the notebook of another staff member and argument with Mr Ventaloro.

Ms Graham observed a subsequent conversation between Ms Ventaloro and the Applicant in the boardroom noting that there were raised voices , this continued for some time and that Ms Graham raised this with Mr Ventaloro, who was in his office, and agreed that the raised voices should not continue as it was affecting everyone in the office. Ms Graham then intervened herself and stated that their behaviour was affecting the office. The Applicant agreed and desisted.

Ms Graham states that Ms Ventaloro did lower her voice and commented that she felt “triggered” when she feels left out or not informed. Ms Graham replied to Ms Ventaloro: “You can’t treat us negatively because of your past experiences, that’s not fair.” Ms Graham contends that Ms Ventaloro started crying and asked the Applicant for a hug to which the Applicant replied “No.” and said words to the effect of “I am not ready to hug and forgive and make-up.

Ms Graham states that Ms Ventaloro does lose her temper weekly and that there is a pattern of crying and remorse, and then reassurance given to Ms Ventaloro from the Applicant. Shortly after the incident above Ms Ventaloro apologised to the staff

On 10 November the witness was requested to go to a nearby café with Mr Ventaloro for a discussion. The Witness states that Mr Ventaloro said that there was an investigation currently underway and everyone had been asked to give a statement and asked if Ms Graham would make one. The witness agreed on the basis that Ms Ventaloro was not present

A short time later Ms Graham noted that the Applicant’s email password did not work and that she further notes that a friend of Ms Ventaloro who provided IT support to the Respondent’s business deleted the Applicant’s email address and password with Ms Ventaloro stating words to the effect of “That can go we don’t need that anymore.”

As to the allegation that the Applicant disclosed a pay rate that was confidential Ms Graham notes that Ms Ventaloro sat on her desk and stated that Mr Ffinch was going to be paid more than herself – and that the Applicant did not disclose his pay rate to her.[P49 witness statement]

Submissions

The Applicant submits that the Dismissal was, within the meaning of s.385(b) FWA:

· unjust because it was not supported by a valid reason as the Applicant was not guilty of the alleged misconduct.

· unreasonable as there was no evidence or material before Pro-Help that could support its conclusions.

· unjust as the decision to dismiss had already been made prior to the issuing of the show cause letter.

· unjust and unreasonable because the Applicant was denied procedural fairness during the pre-Dismissal process and the process was tainted by actual and apparent bias; and

· harsh in light of the duration of her employment, age, and current economic circumstances

Valid Reason

Allegation 1

The Applicant asserts that there is no basis to substantiate this allegation. Ms Graham gave evidence on her witness statement that she was not told at any time the amount of Mr Ffinch’s pay rate. Further Ms Peart amended statement of 11 November 2021 alleges the words used by the Applicant were “He is on the same pay as me but he’s at your level”.

The Applicant had requested further details regarding this allegation on 9 and 10 December 2021 and was not provided any further details or specifics or evidence on how this allegation was substantiated.

Further in cross examination Mr Ventaloro conceded that the Applicant had not disclosed a figure and conceded that this allegation could not be substantiated.

Allegation 2

The evidence of Ms Graham was there was no discussion in the meeting between the Applicant, Ms Graham and Mr Ffinch about a meeting with Mr and Ms Ventaloro earlier that day. The evidence in her witness statement was that earlier discussion had never occurred, this was not challenged in cross examination. The Applicant refuted the allegation, and no evidence was forthcoming during the hearing. Neither Mr nor Ms Ventaloro provided reasons that supported the substantiate the Allegation

Allegation 3

The Applicant submits that having staff meetings is an inherent requirement of the role of the Applicant and that the meeting referred to as the ‘culture meeting’ was a meeting with several topics and the section of the meeting regarding culture was to gather opinions and to circulate to the rest of the organisation. The meeting was an impromptu one notes were taken and minutes produced. No evidence was produced by the Respondent to validate that there was any exclusionary intent or behaviours exhibited.

Allegation 4

The Applicant submits that the notes made in David Hall’s notebook during the meeting of 3 November 2021 were not private or confidential and this was agreed to by Mr Ventaloro during cross examination. The Applicant argues that this allegation has no merit. This is supported by the fact that these notes were recorded into meeting minutes and were shared with other employees.

Allegation 5

The Applicant denies making any disparaging comments during the meeting of 1 November 2021 and there were no notes taken during the meeting. The comments were allegedly substantiated, but it appears this was done after the substantiated allegations were put to the Applicant on 9 November 2021. The Respondent did not provide any specific examples regarding the comments that were disparaging. The enquiries made by the Respondent on 10 and 11 November 2021 were almost a week after the allegations had been ‘substantiated’ by the Respondent.

Allegation 6

The first allegation is that the Applicant said, ‘I fucking don’t believe this Renee, grow up!”. The Applicant firstly denies the use of the word ‘fucking’ and furthermore states that Ms Ventaloro is not her manager, and it is not a comment against management and further, that Ms Ventaloro often used the word ‘fuck’ in the office. It does not constitute abuse or disparagement

The second part of the allegation is that the Applicant refused to share the minutes notes from the meeting and the Applicant stated to Ms Ventaloro that she would “get them when the rest of the rest of the staff get them at Mondays meeting”. Mr Ventaloro confirmed that this is against the background of Ms Ventaloro apologising to all staff verbally and also providing a written apology to the Applicant. Further Mr Ventaloro issued a written warning to Ms Ventaloro regarding her inappropriate conduct at the Marketing meeting.

Procedural Fairness

The Applicant asserts she was not afforded procedural fairness and that the lack of the Respondent’s own documentary evidence supports the contention. The Applicant notes:

“There is no evidence that an investigation occurred prior to the allegations being substantiated on the 5 November 2021.

The Respondent did not put the allegations to the Applicant and seek a response before substantiating them.

The taking of statements from Ms Peart amended 11 November and Ms Swain and Ms Graham on 10 November did not cure the lack of an investigation in the first instance.

The Respondent did not consider the evidence of Ms Graham in relation to the allegations that had already been substantiated.

Ms Ventaloro had a predetermined outcome – the termination of the Applicants employment- in mind and was involved in the disciplinary process and the decision maker was infected by this bias.

There was never an opportunity for the Applicant to have a discussion about each allegation and ask questions to get a clearer understanding of the case against her.

Prior to the decision to terminate the Applicant she was directed to have a meeting with a third party who did not discuss the allegations or the process merely to ask about settlement possibility. This indicated that a decision to terminate her employment had been made.”

Applicant’s witnesses

The Applicant struck me as a credible professional who conducted herself during the hearing in a manner that gave me the impression that she was a witness with some credit. The Applicant responded to questions and provided appropriate responses after consideration and provided more detail where required. She did not depart from her statements.

Ms Graham was also a witness that provided credible testimony that supported her witness statement and provided further information where required without any hesitation or view to considering her answer in the light of anything other than her experiences and honest view.

The case for the Respondent

The Respondent’s case is essentially that they received complaints regarding the Applicant’s behaviour that they portray as bullying and they, after due consideration and a fair process, terminated the Applicant for Misconduct The termination letter details the reasons as: firstly inappropriate behaviour for a senior manager, secondly failure to maintain privacy and confidentiality and thirdly making disparaging comments to Mr and Ms Ventaloro, that is why the decision was made to terminate the Applicant’s employment.

Further, the Respondent asserts that the process of the investigation and events leading to the termination of employment of the Applicant was fair.

Evidence of the Respondent

The Respondent relied on the evidence of Mr Ventaloro, Ms Ventaloro, Bec Peart, Elke Swain, and Mr Ffinch, noting that Mr Ffinch was not available due to health reasons to appear and thus his evidence is untested. I will make a further detailed observation regarding this witness below.

Evidence of Renee Ventaloro

Ms Ventaloro’s evidence included the following from her witness statement

“I myself have felt bullied, isolated, manipulated, power played, micromanaged and degraded by her in our business and feel that I have reached breaking point - I feel I cannot protect myself or others as long as she remains in our business. There have been concerns raised regarding operational matters, bullying and cultural issues, with Caroline as the key undercurrent of disregarding the culture we are trying to build at Pro Help Australia. Consistently raising issues with Caroline has yielded no change but only intensified the negative and secretive, underhanded nature of her behaviour and I believe it has reached a point where we must take final and decisive action to prevent greater staff and disrepute to our organisation.”

In her witness statement Ms Ventaloro catalogues a number of issues that she says supports her contention. Many of them relate to Mr Ffinch who as I commented earlier was not available as a witness due to health issues and so his evidence was not available able to be tested. I will put those contentions to one side. She states that the Applicant states words to the effect of ‘I don’t know what Renee does with her time” and alleges that the Applicant baited staff into making derogatory comments about herself or Mr Ventaloro. That the Applicant dominated meetings and had an aversion & apparent resistance to technology.

Ms Ventaloro stated that she had a discussion with the Applicant and her husband on Monday 1 November with the objective of ‘getting to the bottom’ of the alleged disparaging comment and negative comments. Ms Ventaloro states that they had heard from 3 employees whilst the Applicant was on leave stating that they felt belittled and micromanaged, the Applicant wanted further evidence and wanted to know who made the complaints, which the Respondent declined. Further matters were raised, and the prospect of bullying claims were raised. At each point the Applicant denied or requested evidence to support the assertions.

On 4 November Ms Ventaloro noticed a staff meeting underway and decided to join the meeting and sat next to the Applicant and observed notebook which she glanced at, the Applicant firmly closed the notebook. Following the meeting the Ms Ventaloro demanded that the notebook be provided to her as she felt there was material that confirmed the Applicant’s undermining behaviour. There was a heated discussion where the Applicant stated that as a manger it was her prerogative to hold meetings whenever she thought they would be needed. The Applicant then said ‘I fucking don’t believe this Renee grow up”. Ms Ventaloro read the minutes on the laptop and when the Applicant returned Ms Ventaloro stated that she thought there were some good ideas and valuable feedback and that she may have been wrong about the assumption that the notes were about herself or Mr Ventaloro. Ms Ventaloro said that if the Applicant wanted to have another meeting about culture that the Applicant should email the Respondent. The Applicant refused and said that she did not need to do any of that to have a staff meeting. Ms Ventaloro explained to the Applicant her wish to build an open, honest and inclusive culture. Ms Ventoloro claims during the entire conversation the Applicant was heated, aggravated and defensive and that she was emotionally upset, not angry, elevated or accusatory.

Ms Ventaloro claims that the Applicant threatened to go to the Fair Work Ombudsman as she felt she wasn’t trusted by the Respondent. Ms Ventaloro states that she did end up becoming quite emotional and the Applicant demanded a written apology and further an apology to all staff for Ms Ventaloro’s emotional and irrational behaviour. Ms Ventaloro took the day off as a mental health day. Ms Ventaloro feels that the Applicant’s behaviour towards her was belittling and felt micromanaged and that she has been painted out to be reactive, irrational and irresponsible which is a misrepresentation of herself.

Evidence of Bec Peart

Ms Peart provided evidence in a statement that she felt that the Applicant had stated that the Respondent’s did not know how to run the business and that Mr Ventaloro is incapable of managing the support coordination section of the business. She also claims to have witnessed disclosing information about pay rate of the new regional manager words with words to the effect “he is on the same pay as me, but he is at your level of role”.

Evidence of Elke Swain

Ms Swain made a statement at the request of the Respondent. In her statement she claims that the Applicant showed disrespect to the Respondent on more than one occasion and that the Applicant complained about travel to the coast each weekend. She further claimed that the culture meeting held on 3 November 2021 with only three attendants was designed by the Applicant to achieve an outcome that may not have been positive for Ms Swain or the Respondent’s but added that she did not attend the meeting and therefore didn’t have the whole context.

Ms Swain made a further statement in March 2022 where she claims following the departure of the Applicant that recently hired employee had in fact serious medical issue which had not been revealed to the HR department Swain stated that should have been a medical assessment conducted prior to hiring the staff member. She felt that the Applicant had failed in her professional obligations regarding safety and risk management not only for the potential staff member also clients. That staff member was terminated during her probation period.

Evidence of Mark Ffinch

Mr Ffinch provided a detailed statement regarding the alleged lack of support and direction from the Applicant and further specific challenges in his role. The result of this he says caused him great deal of stress and to work very long hours.

Mr Ffinch was unavailable to provide testimony and confirm evidence on either of the hearing dates the Respondent’s stated that he had significant health issue would be unable to attend. Without this witness being able to attend and affirm his evidence and provide testimony and be subject to cross examination I am unable to consider his evidence. This is problematic as the issues regarding this witness in his treatment by the Applicant did form a significant part of the allegations of misconduct.

Evidence of Lisa Barker

Ms Barker made a statement and provided testimony for the Respondent. She stated that she found the Applicant to be an obnoxious, intimidating and condescending towards her and quite dismissive as to the witness’s ability to support complex new clients on a 24 basis.

Evidence of Paul Ventaloro

Leaving aside the complaints from Mr Ffinch who was unable to attend and swear to his statement the following submissions are made by Mr Ventaloro. He states that when the Applicant was on leave that a number of staff came forward to make a complaint about the Applicant regarding the making of disparaging comments about Mr and Ms Ventaloro. Mr Ventaloro discussed the staff concerns when the Applicant returned from leave on 1 November 2021. Mr Ventaloro claims that the Applicant talked over him and dominated the conversation and did not acknowledge the staff issues but rather concentrated on advocating her case that she was the one whose treatment should be focused upon.

He further alleges that following this meeting that the Applicant called a meeting on 3 November 2021 with two staff and without involving himself and Ms Ventaloro, he felt that the Applicant was ‘gathering a side and polarising the employees” against the Respondent. Mr Ventaloro states that Ms Ventaloro left that meeting and reported to him about the notebook that she thought contained disparaging remarks and content. Mr Ventaloro said that Ms Ventaloro received a warning from him regarding her sharp comments to the team. Following the team meeting Mr Ventaloro observed a meeting between the Applicant and the Ms Ventaloro and following the discussion, Ms Ventaloro was in tears. She apologised to the staff and left that day for a mental health day.

Mr Ventaloro stated that Ms Ventaloro felt pressured and bullied by the Applicant and wanted to continue an application to the Fair Work Commission. Mr Ventaloro then decided to get advice from Focus HR (HR Consultants) who advised to put the Applicant on leave with pay and begin an investigation.

On 5 November Mr Ventaloro considered statements from Mr Ffinch, Ms Ventaloro, Ms Peart, Ms Swain. The complaints indicated that the employees did not wish to make a complaint whilst the Applicant was in position as they felt that the Applicant would make life difficult, and they say that they would resign or consider resigning if the Applicant was not terminated.

Mr Ventaloro claims that the Applicant declined to provide a detailed statement in her response and the Applicant requested more information as she considered there to be not enough detail to respond effectively. Mr Ventaloro did not provide further details as he felt that he would breach the confidentiality of the employees who had provided their concerns.

Further Mr Ventaloro contends that the Applicant had not followed up a number of business referral meetings and when confronted about this was rude and loud. The Applicant disagreed that Ms Ventaloro should attend these meetings and Mr Ventaloro responded by stating that Ms Ventaloro was across the whole business

Mr Ventaloro claimed that the Applicant’s disparaging and disrespectful attitude towards himself and Ms Ventaloro, and other staff and stakeholders, was frequently witnessed by staff, external stakeholders, and potential partners.

Mr Ventaloro asserted that frequently any discussion with the Applicant would elicit a strong emotional response and would not enable the Respondent to address culture issues or other matters without the Applicant escalating the matter and the Respondent left feeling that they were being dominated.

Mr Ventaloro asserts the process leading to termination was a fair one. He contends that there was a face to face meeting with the Applicant on 1 November 2021 where he provided the feedback from the other team members and given an opportunity to respond. He states that the Applicant rejected the concerns and turned the conversation onto the Respondents behaviour. He admits the meeting was not a success.

On 5 November 2021, he placed the Applicant on paid leave and provided a show cause letter however, he notes that the Applicant did not provide a detailed response. When the period for a response was extended the Applicant provided further responses on 9 November 2021. A further extension to 10 November did not elicit any further information for the Respondent to consider.

Mr Ventaloro contends that the Applicant’s termination on 12 November was after consideration of the material that the Applicant had provided. He states that if she had raised any further material, he would have allowed more time to consider the extra evidence.

Consideration

Comments about the evidence

The Applicant struck me as a reliable witness of credit, she responded appropriately to questions and gave further information when requested. She presented in a straightforward manner without artifice or affectation. Ms Graham similarly presented as a credible witness with her evidence being given in a manner without pretence and driven by honest belief, she conceded that she had a friendship with the Applicant without hiding or obfuscating the issue.

Ms Ventaloro presented as a witness prone to hyperbole and outbursts. She no doubt feels strongly about the matters and issues discussed however she did not bring an objective mind to the processes of submissions and the hearing

Mr Ventaloro presented as a thoughtful witness however he was prone to obfuscation in answering and did not provide succinct and accurate answers under cross examination. He was naturally wanting to present the Respondent in the better light however he did not make concessions when it would have been appropriate. In saying that he did answer for the most part truthfully.

Was the Applicant unfairly dismissed?

Section 387 of the 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]

(a) whether there was a valid reason for the dismissal

The reasons given by the Respondent for the termination of the Applicant’s employment were contained in the letter of termination dated the 12 November 2021. The reasons were; firstly, behaviour that was inappropriate for a senior manager. Secondly, a failure to maintain privacy and confidentiality and thirdly, disparaging comments of a highly disrespectful nature about the Respondent to the staff. These three matters were not specifically aligned to the allegations in the show cause where 6 allegations were raised. I will address each of the allegations in turn which will also address the 3 points in the termination letter

The gravamen of the Applicant’s case is that her dismissal was not for a valid reason because none of the allegations could be sustained and further the process was fatally flawed.

As Vice President Hatcher observed in Raj Bista v Group Pty Ltd t/a Glad Commercial Cleaning, establishing a factual basis for the reason for dismissal will not of itself demonstrate the existence of a valid reason.[2] It must, as s.387(a) makes clear, be a valid reason for dismissal. To be a valid reason, the reason for the dismissal should be “sound, defensible or well founded”[3] and should not be “capricious, fanciful, spiteful or prejudiced.”[4] As summarised by Deputy President Asbury in Smith v Bank of Queensland Ltd a “dismissal must be a justifiable response to the relevant conduct or issue of capacity. Factually-established conduct which might, for example, justify the issue of a reprimand or a warning may not necessarily justify dismissal”.[5]

In Bista, Hatcher VP referred to the decision of the Full Court of the Federal Court in Edwards v Giudice[6] as being authority for the proposition that the consideration of whether there is a valid reason for dismissal requires an assessment of whether the conduct was so serious as to justify termination as a sound, defensible or well-founded response.[7]

In Smith v Bank of Queensland Ltd, Deputy President Asbury continued to consider Hatcher VP’s decision in Bista in the following terms:

“[125] Vice President Hatcher went on to observe that it is well established that a dismissal for misconduct may be found to be harsh on the basis that the sanction of dismissal is a disproportionate penalty to the gravity of the misconduct, and that the issue of proportionality is usually considered having regard to all relevant circumstances of the dismissed employee and his or her conduct. His Honour also noted that there is divergence in the authorities in relation to whether the gravity of the misconduct is considered separately from the factors subjective to the particular employee with the former consideration arising under s. 387(a) and the latter under s. 387(h). His Honour observed that proportionality of dismissal as discussed by Moore J in Edwards v Giudice, was not concerned with proportionality of dismissal in the sense where the gravity of the misconduct is weighed against a range of other potentially mitigating factors. Rather it was concerned with whether the conduct in question, considered in isolation, was intrinsically capable of constituting a valid reason for dismissal if it only involved a minor misdemeanour.

[126] I do not understand that there is a rule that the gravity of the misconduct must be considered under s. 387(a) devoid of any mitigating factors a dismissed employee may raise. While the gravity of the conduct must be considered and assessed, in my view, there are some mitigating factors which may also go directly to the validity of a reason for dismissal by mitigating the seriousness of the conduct for which a person was dismissed. Examples of some of these factors may be lack of training or the dismissed employee being placed under undue pressure by some failure on the part of the employer, which contributed to the conduct for which the employee was dismissed. Those matters may go to the reasonableness of the dismissal on the basis that they mitigate the gravity of the employee’s conduct. There are other mitigating factors which relate to personal circumstances of the dismissed employee and which may render the dismissal harsh, notwithstanding that the gravity of the employee’s conduct justifies dismissal. The first category of mitigating factors falls for consideration under s. 387(a) of the Act and the second category under s. 387(h).” (citations omitted)[8]

All that said, it is not the role of the Commission to “stand in the shoes of the employer and determine whether or not the decision made by the employer was a decision that would be made by the court.”[9] However, the Commission must consider the entire factual matrix in determining whether an employee’s termination is for a valid reason.[10]

I am not satisfied that a collection of complaints from employees lacking in specificity, based on feelings regarding how the Applicant had been discharging her duties, and which could not be addressed by the Applicant, would be sufficient to warrant dismissal for misconduct.

Allegation one

The Applicant maintained that she never disclosed any salary details to regarding Mr Ffinch. Further Mr Ventaloro agreed that Ms Peart did need to know Mr Ffinch’s salary details. The evidence of Ms Graham which was not challenged was that at no time was she told of Mr Ffinch’s salary. Further, no further evidence was provided by the Respondent as to the numerous occasions and in cross examination both Mr and Ms Ventaloro conceded that this allegation could not be substantiated.

Allegation two

The Respondent could not support this allegation when cross examined, they could not point to the reasoning that supported the allegation. The Allegation imputes that the Applicant raised Mr Ffinch’s grievances in front of Ms Graham. Ms Graham in cross examination could not reply with any certainty that those comments were made. The Applicant requested further particulars of this allegation, but no further information was provided. This allegation does not meet that standard required to support the contention that it was substantiated. This allegation falls away.

Allegation three

Alleges that a meeting that was exclusionary and, on a topic, culture, that was off limits and required approval to conduct, cannot be substantiated. In cross examination Mr Ventaloro could not point to any exclusionary behaviour agreed that during the meeting of the 1 November there was no mention of exclusionary conduct, and he could not provide any evidence of exclusionary conduct. Further, the Applicant as the Queensland Manager was required in her role to meet with staff and initiate meetings. That permission to hold meetings from Mr Ventaloro was not required. Further he had no knowledge of what the meeting on the 3 November was about but confirmed he received the minutes the following day. The Allegation cannot be sustained.

Allegation four

The notes taken by David Hall during the 3 November meeting were not confidential and were used to create the minutes for staff and circulated. Mr Ventaloro in cross examination admitted that the notes were not confidential or private. This Allegation does not stand.

Allegation five

This allegation concerns alleged disparaging comments that were made by the Applicant about Mr and Ms Ventaloro. Unfortunately, no evidence was produced regarding the specific comments or when they were made and whom to, this made it difficult/impossible for the Applicant to respond to and without particularising the comments, when they were made and to whom this allegation lacks the requisite rigour. It seems unlikely that this allegation could be substantiated without the details of what was substantiated. If all it took was for an individual to make an allegation and provided no details other than an assertion for the Applicant to have a substantiated finding against them that would be the height of procedural unfairness. This is a whispering campaign, it was without any details and therefore the subject of the complaint is unable to deny or offer an alternative view of the incident then there is no procedural fairness, vague allegations without details are not able to be substantiated and as such this allegation must fail.

Allegation six

The statement that was alleged and the follow up remark in the allegation must be seen in the light of the circumstances that day. Following the meeting on 3 November Ms Ventaloro provided an apology to all staff involved and a separate written apology to the Applicant. Further Ms Ventaloro received a written warning for her conduct. The statements and remarks that Ms Ventaloro attribute to the Applicant are hardly conduct that would substantiate misconduct. The language used was not extreme and were words that Ms Ventaloro had also used in the workplace previously. The words are not used aggressively and whilst impolite is hardly offensive given Ms Ventaloro’s use of the word in the workplace. The Applicant’s, if she uttered the words, were not done so in an aggressive act but rather out of frustration. It would seem the Applicant has withstood some overly assertive behaviour from Ms Ventaloro, to which the apology attests, and if the Applicant responded with these words and no action was taken at the time then it hardly meets the test of misconduct. Further the Code of Conduct and Bullying and Harassment was not produced in evidence which suggest that the behaviour may not be as serious as painted by the Respondent. This allegation also fails to be substantiated in my assessment.

The Commission has held in several cases that the mere act of swearing at work is not sufficient to terminate someone’s employment. Further, the context, environment and type of workplace will also impact on the circumstances must be considered when evaluating the severity of the transgression. Similarly, extremely crude and obscene language is to be treated differently to common swear words. In the decision of Smith v Aussie Waste Management Pty Ltd, in which an employee who told his manager “you dribble shit – you always dribble fucking shit” could be disciplined, but that the termination of his employment was harsh and unreasonable in the circumstances and his reinstatement was ordered.[11] [1] Smith v Aussie Waste Management Pty Ltd[2015] FWC 1044.

Other matter raised by the Respondent

The Respondent raised a number of other matters which I take to be further material the Respondent considered either leading up to the dismissal of the Applicant or shortly afterwards. The matter of incomplete incident reports was raised which I take to be a serious matter in the proper administration of the business. It is difficult to assess whether the matter of incomplete reports or duplicates rested solely with the Applicant or whether she had managerial responsibility for implementing appropriate systems of work to ensure the quality of the reports. In either event the argument that this was part of the reasons I should consider the Applicants dismissal was not made out clearly. It may have been a result of poor administration or a breakdown in expectations of responsibility of completing the forms accurately. In any case the linking of the incident reports with either poor performance or misconduct was not made out and thus I do not consider this matter would reach a threshold for consideration as a valid reason.

The recruitment of Ms Omire was raised as an example of an inappropriate hire and the Respondent put that the person responsible was the Applicant. In evidence provided in cross examination it was clear that Ms Graham had the authority to employee Ms Omire. Further no disciplinary action was taken against Ms Graham for the recruitment decision and this was evidenced by Ms Swain and Mr Ventaloro in cross examination.

Ms Yates evidence in testimony contradicted her statement and as admitted by her she had a friendship with Ms Ventaloro. Given the contradictions in her evidence and her friendship with Ms Ventaloro and the lack of probative material she put forward I give no weight to her evidence. It does not shine a light on any valid reasons or any other factors I must consider.

A further witness for the Respondent, Ms Barker of Butterfly House provided her opinion and feelings regarding the Applicant’s behaviour that she claimed to have observed. There was little probative value in her evidence, she presented as hostile towards the Applicant and the evidence of the meeting in January 2021 provides little if any support to the Respondent’s argument that the Applicant’s conduct should be regarded as misconduct or serious misconduct. I do not have regard to this evidence.

I find that none of the allegations are substantiated and therefore do not meet the requirements for a valid reason. Even collectively the allegations do not amount to serious misconduct warranting dismissal as the Respondent contend. The Allegations were no more than a collection of statements made by employees who when asked by the Respondent to provide material regarding the Applicant made statements with little to no probative value. The words ‘feel’ abounds. It requires more than rounding up employees to make statements to meet a standard of evidence that would constitute substantiated allegations. The statements nor any other documents that could be regarded as an ‘investigation’ were not provided. The substantiation was not an investigation into the allegations employees made but rather the Respondent regarded the collection of statements as substantiating their view that the Applicant was – a troublesome, dominating, difficult and possibly demanding manager in their organisation.

(b) and (c) whether the person was notified of that reason and had an opportunity to respond

The Applicant was provided with a show cause document with 6 allegations which had been all been substantiated without the input of the Applicant. This seems that there had been a desired outcome already. The Applicant made attempts to respond and asked for clarity on the and more information on the allegations and investigation but was rebuffed. She further requested that an external investigation be undertaken in an effort to restart the process on a more procedurally fair footing. This was also denied.

Under cross examination Mr Ventaloro conceded that Ms Ventaloro had direct involvement with Focus HR and did admit to wanting the Applicant dismissed. He further agreed that there was no meeting to discuss the show cause and was not agreeable to undertake an independent investigation.

In a sense the Applicant was notified of the reason for her dismissal and had an opportunity to respond to the allegations. She may not have had an opportunity to challenge the Respondent’s ultimate decision to terminate her employment by making specific submissions regarding the mitigating factors, but she was warned that termination might be contemplated in the show cause letter and therefore had an opportunity to address it if she wished. Further, given the Respondent’s position it is unlikely that any such submission would have had an impact on the ultimate decision.

(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

The Applicant was not unreasonably refused a support person, however during the meeting of 1 November, the Applicant did not have the opportunity to request one

(e) if the dismissal related to unsatisfactory performance by the person – whether the person had been warned about that unsatisfactory performance before the dismissal

This factor is irrelevant to the present case.

(f) and (g) the degree to which the size of the employer’s enterprise and the absence of dedicated human resource management expertise would be likely to impact on the procedures followed

The Respondent did take advice from an external HR organisation as they did not have their own Human Resources function within their business. Although there may be some regard to the reduced or limited skills within the organisation such an egregious and flawed dismissal fits well below the bar required for a procedurally fair process based upon a valid or valid reasons. It is not clear whether HR Focus provided advice as to how a fair investigation should be conducted and the requisite level of facts to be established to substantiate allegations, and whether that advice was ignored in the Respondents rush to find the Applicant guilty at all costs. It is to be hoped that the advice was ignored rather than HR Focus be complicit in a flawed dismissal.

(h) any other matters that the FWC considers relevant

The decision to terminate the Applicant’s employment was unfair and harsh. The allegations were not substantiated, the investigation was cursory if at all and I regard the decision to terminate was made without any valid reasons

Conclusion

Therefore, for the reasons given above, I am satisfied that the Applicant has been unfairly dismissed. I turn now to remedy.

Remedy

Given that I have found that the Applicant’s dismissal was unfair, it is necessary to consider the question of remedy. The Applicant has made an application under s. 394 of the Act and in my view the Applicant should have a remedy for her unfair dismissal.

Section 390 of the Act provides that:

“390 When the FWC may order remedy for unfair dismissal

(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of compensation to a person, if:

(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and

(b) the person has been unfairly dismissed (see Division 3).

(2) The FWC may make the order only if the person has made an application under section 394.

(3) The FWC must not order the payment of compensation to the person unless:

(a) the FWC is satisfied that reinstatement of the person is inappropriate; and

(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.

Note: Division 5 deals with procedural matters such as applications for remedies.”

Section 392 sets out the considerations for awarding 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.”

Applicant’s submissions

The Applicant sought that the Commission make orders for compensation. The Applicant acknowledged that she had only been employed for a relatively short period of one year and four months before she was dismissed. She was paid two weeks in lieu of notice and commenced employment with a new employer on 16 May 2022. The intervening period being 26 weeks and 3 days. The Applicant sought 26 weeks compensation less two weeks paid for the notice period. Thus, the Applicant submitted that she be paid 24 weeks at $1822.10 which is $43,730.40.

The Applicant submitted that notwithstanding her having had a relatively short period of service, that the egregious manner and process of the dismissal should outweigh the any diminishment for her short period of service.

Respondent’s submissions

The Respondent submitted that reinstatement is not appropriate on the basis that there is a loss of trust and confidence in the Applicant. Additionally, the Respondent asserted that a decision to reinstate would have a profound impact on the remainder of the workforce. The Respondent submitted that the harmony of the workforce would be affected through if the Applicant were to be reinstated. It could very well give rise to a situation where employees believe they are immune from dismissal and treat each other discourteously and disrespectfully.

The Respondent maintained that there is a loss of trust and confidence in the Applicant, that the employment relationship has deteriorated significantly, and reinstatement would be entirely inappropriate.

Consideration

Section 390(3)(b) of the Act provides that the Commission may only issue an order for compensation if it is appropriate in all the circumstances. Compensation as a remedy is designed to compensate an unfairly dismissed employee, in lieu of reinstatement, for losses reasonably attributable to the unfair dismissal, within the bounds of the statutory cap on compensation that is to be applied.1 Nguyen v Vietnamese Community in Australia [2014] FWCFB 7198.

Given the Applicant has mitigated her loss and is now employed elsewhere then compensation is the appropriate remedy.

It is therefore necessary for me to assess the amount of compensation that should be ordered to be paid to the Applicants, having regard to the criteria under section 392(2) of the Act.

The established approach to assessing compensation in unfair dismissal cases was set out in Sprigg v Paul’s Licensed Festival Supermarket[12] and applied and elaborated upon in the context of the current Act by Full Benches of the Commission in a number of cases. The recent Full Bench decision in Alison Thurston v Bunbury Medical Imaging[13], 3 noted that as to the Sprigg formula:

“[32] The well-established approach to the assessment of compensation under s.392 is to apply the ‘Sprigg Formula’, derived from the Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul Licensed Festival Supermarket. This approach was articulated in the context of the current legislative framework in Bowden v Ottrey Homes Cobram and District Retirement Villages (Bowden). Under that approach, the first step to be taken in assessing compensation is to consider s.392(2)(c), that is, to determine what the Applicant would have received, or would have been likely to receive, if the person had not been dismissed (the Anticipated Period of Employment). In Bowden this was described in the following way:

[33] The first step in this process - the assessment of remuneration lost - is a necessary element in determining an amount to be ordered in lieu of reinstatement. Such an assessment is often difficult, but it must be done. As the Full Bench observed in Sprigg:

‘... we acknowledge that there is a speculative element involved in all such assessments. We believe it is a necessary step by virtue of the requirement of s.170CH(7)(c). We accept that assessment of relative likelihoods is integral to most assessments of compensation or damages in courts of law.’

[34] Lost remuneration is usually calculated by estimating how long the employee would have remained in the relevant employment but for the termination of their employment. We refer to this period as the ‘anticipated period of employment’...”

In Bowden, the Full Bench stated:

“[23] Section 392(2) of the FW Act is similar to s.170CH(7) of the WR Act, prior to the Work Choices amendments, and s.654(8) of the WR Act. However, s.170CH(7) and s.654(8) did not contain terms similar to ss.392(2)(e) and (f). Nonetheless, under the WR Act post dismissal remuneration of the dismissed employee was usually had regard to by the Australian Industrial Relations Commission (AIRC) in determining an amount of compensation.

[24] As much is apparent from the decision in Ellawala v Australian Postal Corporation. In Ellawala a Full Bench of the AIRC said in respect of s.170CH(7) of the WR Act, prior to the Work Choices amendments:

“[31] The principles applicable to determining an amount to be ordered in lieu of reinstatement are dealt with in Sprigg. In that case the Full Bench endorsed the following approach:

Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).

Step 2: Deduct monies earned since termination.

Step 3: Discount the remaining amount for contingencies.

Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.

[32] Any amount provisionally arrived at by application of these steps is subject to whether offsetting weight is given to other circumstances, including those that need now to be taken into account under paragraphs 170CH(7)(a), (b) and (c) [sic]. The legislative cap on the amount able to be ordered is then applied pursuant to ss.170CH(8) and (9). …

[35] In a particular case the Commission estimates that if the applicant had not been terminated then he or she would have remained in employment for a further 12 months. The applicant has earned $3,000 a month for the 18 months since termination, that is $54,000. Only the money earned in the first twelve months after termination - that is $36,000 - is deducted from the Commission’s estimate of the applicant’s lost remuneration. Monies earned after the end of the ‘anticipated period of employment’, 12 months after termination in this example, are not deducted. This is because the calculation is intended to put the applicant in the financial position he or she would have been in but for the termination of their employment.

[36] The next step is to discount the remaining amount for ‘contingencies’. This step is a means of taking into account the possibility that the occurrence of contingencies to which the applicant was subject might have brought about some change in earning capacity or earnings…

[43] We note that in Slifka North J only applied the deduction for contingencies to prospective loss, that is loss occasioned after the date of the hearing. This approach has also been adopted in a number of first instance arbitrations by members of the Commission. As a matter of logic this approach has some appeal. A discount for contingencies is a means of taking account of the various probabilities that might otherwise affect earning capacity. At the time of hearing any such impact on an applicant’s earning capacity between the date of termination and the hearing will be known. It will not be a matter of assessing prospective probabilities but of making a finding on the basis of whether the applicant’s earning capacity has in fact been affected during the relevant period. But this matter was not raised before us and we were not directed to any evidence upon which we could make a finding as to whether Ms Ellawala’s earning capacity was adversely effected by some event which took place in the period between her termination and the hearing of the matter at first instance…

[45] In relation to the fourth step set out in Sprigg we note that the usual practice is to settle a gross amount and leave taxation for determination.” [Endnotes omitted]” 4 (Emphasis added)

In light of the authorities and in accordance with the Sprigg formula, I have considered as follows, noting that s 392(2)(f) is not relevant in this matter.

Remuneration the Applicants would have received, or would likely have received, if they had not been dismissed (s 392(2)(c))

As with any calculation of damages or compensation, this involves an element of speculation in determining an employee’s anticipated period of employment, because the task involves an assessment of what would have been likely to happen in the future had the employee not been dismissed.

In considering the matter I have arrived at 12 weeks would be the period that the Applicant would have received if they had not been terminated. There was much enmity from the Ventaloros towards the Applicant and I asses that the Applicant would have most likely been terminated for more substantial reasons or an offer made for mutual separation.

Remuneration earned (s 392(2)(e))

I note that the Applicant has secured alternative work and is now employed from the 16 May 2022 a period of 26 weeks and 3 days from the termination date during this period she provided no evidence of any earnings of which I should take account.

Viability (s 392(2)(a))

The Respondent does not contend that the making of a compensation order in favour of the Applicant will adversely impact on the viability of its business enterprise. Accordingly, no adjustment will be made on account of this.

Length of service (s 392(2)(b))

The Applicant had only been employed for one year and four months, a relatively short period.

Mitigation efforts (s 392(2)(d))

The Applicant has mitigated the effect of the termination by finding employment following the termination of employment.

Any other relevant matter (s 392(2)(g))

I now need to consider the impact of contingencies on the amounts likely to be earned by the Applicant for the remainder of the anticipated period of employment.

I do not factor anything for contingencies.

Misconduct (s 392(3))

No misconduct was proven and so I make no deductions.

Shock, distress or humiliation, or other analogous hurt (s 392(4))

I note that in accordance with s 392(4) of the Act, the amount of compensation calculated does not include a component for shock, humiliation or distress

Compensation cap (s 392(5)-(6))

As I have previously noted, the Applicant earned below the high-income threshold and therefore the compensation cap is 26 weeks’ compensation.

Instalments (s 393)

No application has been made to date by the Respondent for any amount of compensation awarded to be paid in the form of instalments.

Conclusion on compensation

Therefore, I award 12 weeks at $1822.10 with no deductions a total of $21,865.20

I order that the Respondent pay to the Applicant the amount of remuneration as calculated above.

DEPUTY PRESIDENT LAKE

[1] Sayer v Melsteel Pty Ltd[2011] FWAFB 7498 [14]; Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002) [69].

[2] Raj Bista v Group Pty Ltd t/a Glad Commercial Cleaning[2016] FWC 3009.

[3] Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373.

[4] Ibid.

[5] Smith v Bank of Queensland Ltd [2021] FWC 4 [122].

[6] (1999) 94 FCR 561.

[7] Raj Bista v Group Pty Ltd t/a Glad Commercial Cleaning[2016] FWC 3009.

[8] Smith v Bank of Queensland Ltd [2021] FWC 4 [125]-[126].

[9] Walton v Mermaid Dry Cleaners Pty Ltd (1996) 142 ALR 681, 685.

[10] Allied Express Transport Pty Ltd v Anderson (1998) 81 IR 410, 413.

[11] Smith v Aussie Waste Management Pty Ltd[2015] FWC 1044.

[12] Sprigg v Paul’s Licensed Festival Supermarket (1988) 88 IR 21

[13] Thurston v Bunbury Medical Imagine[2021] FWCFB 280

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