Charmaine Dillon v Club Box Pty Ltd T/A Club 26
[2012] FWA 8634
•31 OCTOBER 2012
[2012] FWA 8634 |
|
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Charmaine Dillon
v
Club Box Pty Ltd T/A Club 26
(U2012/456)
COMMISSIONER SIMPSON | BRISBANE, 31 OCTOBER 2012 |
Termination of employment - Jurisdiction - Not a genuine redundancy - Dismissal Unfair - Compensation Ordered
[1] This matter concerns an application for unfair dismissal remedy filed by Charmaine Nicole Dillon (the Applicant) against Club Box Pty Ltd t/a Club 26 (the Respondent). The application was filed on 7 March 2012. A conciliation conference was conducted on 26 March 2012 which was unsuccessful. A jurisdictional objection to the application seeking its dismissal was filed by the Respondent on 29 March 2012 on the grounds of genuine redundancy.
[2] Hearing dates for the jurisdictional objection and the substantive matter were vacated on a number of occasions before the file was allocated to my chambers for hearing on 16 October 2012.
[3] The Applicant represented herself and the Respondent was represented by Martin Robert Box the owner and licensee of the Respondent. The Applicant filed an outlined of submissions and four witness statements but ultimately only called herself and one other witness Dominique Adele Hemmings at the hearing.
[4] The Respondent filed an outline of submissions and two witness statements from Martin Box and Jodie Kathryn Box.
CONSIDERATION
[5] Section 396 of the Fair Work Act 2009 (FW Act) requires that Fair Work Australia (FWA) must decide whether a dismissal was a genuine redundancy before considering the merits of the application.
Section 389 provides as follows:
389 Meaning of genuine redundancy
(1) A person’s dismissal was a case of genuine redundancy if:
(a) the person’s 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.
(2) A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:
(a) the employer’s enterprise; or
(b) the enterprise of an associated entity of the employer.
Section389(1)(a)
[6] Martin Box said that he made a decision to attempt to sell the Club in August 2011 due to financial hardship. 1 He said in January 2012 Matthew Fox expressed an interest in purchasing the business. In January 2012 Martin Box said he reduced the sale price for the business. 2 He said in early February 2012 he viewed the figures for the turnover for the month of January 2012 which were the lowest since he had purchased the business and at this time made the decision he could no longer afford to retain the Applicant as a general manager and that he would have to move to Brisbane from Victoria to oversee the business himself in order to reduce costs.3
[7] The Applicant gave clear evidence she accepted that Martin Box as the Director of the Respondent made a decision to move to Brisbane to run the business himself rather than pay her as general manager. 4 Her grievance was not that the job of general manager still existed, but that she claimed she was not offered an available alternative. 5 On that basis no issue for the Respondent arises with regard to section 389(1)(a).
Section 389(1)(b)
[8] Both parties agreed in the course of the hearing that a common law contract existed for the purposes of establishing the pay and conditions of the Applicant but there was no registered agreement that would be captured by the meaning of an agreement as described in section 389(1)(b). 6
[9] I am also satisfied on the basis of the material before me, the submissions of the parties in the course of the hearing 7 and having regard to the principle purpose or primary function of the Applicant (as discussed in Michelle Gray v Hamilton James and Bruce Pty Limited8 in her role as the General manager of the Respondent, that the Applicant was not covered by the Clerks - Private Sector Award 2010 or any other modern award.
[10] On the basis of these observations there can be no issue with regard to the Respondent having failed to comply with any obligation in an agreement or modern award to consult about redundancy.
Section 389(2)
[11] The remaining issue concerning the question of whether this is case of genuine redundancy is whether it would have been reasonable in all the circumstances for the Applicant to have been redeployed.
[12] Martin Box claimed that on the basis of the business struggling he had requested of the Applicant in May 2011 that she reduce her hours as the general manager, or work as a shift manager, or as another alternative reduce her amount of pay. He said the Applicant replied that she had said she would consult her husband, and a week later responded that she could not agree to these requests. The Respondent claims at this time he foreshadowed that he would be making the general manager role redundant in the future. 9 10
[13] Martin Box claimed he had since May 2011 attempted to offer the Applicant redeployment 11 and talked to her numerous times about working in shift management which she declined. 12 The Applicant accepted that in May 2011 Martin Box had told her he intended to reduce her hours to four days a week, to which she responded she could not accept this. 13
[14] According to Martin Box in May 2011 another employee engaged as a shift manager reduced their hours from 40 to 24 per week and in June 2011 the Applicant commenced performing these two ‘shift manager’ shifts however also refused a request from Martin Box to reduce her hourly rate while performing those shifts from $33.75 per hour (which he described as the general manager rate of pay) to $24 per hour (the shift managers rate). It was the Applicants version that Martin Box had asked her to terminate this employee to save on wages and the Applicant agreed to perform two of her shifts to save that employee from losing her job, thus achieving a saving and protecting the employee from termination. 14
[15] Martin Box claimed to have raised the matter of the Applicant reducing her shifts again in November 2011 and the Applicant declined, but this is disputed by the Applicant. 15 16
[16] Finally Martin Box claimed that he offered the shift manager role two days a week to the Applicant again on 14 February 2012 in the same meeting where he told the Applicant the general manager role was redundant and she rejected the offer saying she was not prepared to work as shift manager and her job was general manager. 17 The Applicant was adamant that the offer was never made and had it been she would have accepted the two shifts per week as shift manager.18
[17] It was the Applicants evidence that the meeting of 14 February did not commence on the basis of a discussion about redundancy but as a discussion that $12,038.06 was missing. 19 Mr Box did not dispute this. The Applicant said she provided an explanation on the accounting discrepancy based on funds in the ATM and petty cash to Martin Box and Matthew Fox (who was invited to attend as Martin Box’s witness). The Applicant said Matthew Fox, having been shown this information checked it and accepted that it resolved the discrepancy.20
[18] It is not disputed that following the meeting of 14 November where the Applicant was told her position was redundant she provided medical certificates that covered the notice period. 21 She also sent correspondence on 15 February 2012 to the Respondent marked attention to Martin Box. There is no reference in that correspondence to potential alternative employment.22 On 21 February 2012 Martin Box, on behalf of the Respondent, sent the Applicant two letters in reply concerning the termination. He gave evidence that he received legal advice concerning the drafting of these letters. One of these letters includes the following sentence;
“Club 26 has considered whether it is able to redeploy you elsewhere in the business and has determined that there are no suitable alternative positions.”
[19] This sentence is at odds with Martin Box’s evidence that an alternative did exist and that it was offered to the Applicant and she rejected it. 23 24 Neither of the letters of 21 February 25 makes any reference to Martin Box’s claim that the alternative of two shifts as shift manager was offered and rejected; to the contrary it indicates the Respondent believed there were no “suitable alternatives”. While Martin Box stated that the letter was drafted by a lawyer, 26 27 the letter is signed by Martin Box and his evidence contradicts its contents. It raises the obvious question, why did he sign the letter if it did not describe what actually occurred.
[20] There has been no suggestion from the Respondent the part-time role of shift manager might not have been a suitable alternative for the Applicant as it has been Martin Box’s evidence that the Thursday and Friday shifts were offered to her.
[21] As I prefer the view that the Applicant was not offered the shift manager role the remaining question is was it reasonable in all the circumstances for the Applicant to be redeployed into the part time shift manager role. It is my view that it would have been. It is common ground between the parties that the Applicant had been performing the functions of that very role on Thursday and Friday since June 2011, albeit subsumed as a component of her broader role of general manager. 28 There was no suggestion she could not perform the role, she was more than qualified having the necessary skills and experience and it was in the same location she was already employed. It was the submission of the Applicant that while she was disappointed about losing the general manager role she would have accepted the part time shift manager role as an alternative to unemployment. 29 There is a good basis to accept what she said on this point in the context of preparing for parenthood and the associated expenses and a period when she would not be earning a wage.
[22] Matthew Fox could reasonably have been expected to be called by the Respondent in order to respond to the Applicant’s claim that no mention was made of the alternative shift manager roles available at the meeting of 14 February 2012.
[23] The explanation of the Respondent for not calling Matthew Fox was that he was overseas dealing with urgent matters in the Solomon Islands. 30 This matter has however been on foot since March 2012. The very reason according to Martin Box for Matthew Fox to be present in the meeting was to act as a witness for the Respondent. I find it difficult to accept that in circumstances where the Applicant has directly challenged the Respondent’s version of the conversation at the meeting on 14 February in a statement filed with the Tribunal on 4 June 2012, and the Respondent being on notice since that time that the Applicant’s evidence would be that she was never offered the alternative shift manager role, that the Respondent has been unable to make contact with Fox in order for him to provide some corroboration of Martin Box’s version. He indicated he had spoken to Matthew Fox’s wife at one point and that Matthew Fox had returned to Australia and had then gone overseas again.31
[24] As the Respondent brings the jurisdictional objection the onus rests with it to make the case of genuine redundancy. Ultimately I am required to make a decision on the balance of probability about whose evidence to accept regarding the dispute as to whether the shift manager role was offered or not. On the basis of my views expressed above concerning the letter signed by Martin Box on 21 February 2012 and in the absence of any evidence from Matthew Fox I am unable to conclude on balance that an offer of redeployment was made. Based on the evidence the Applicants claim is the more likely of the two possibilities. As I have concluded it would have been reasonable for the Applicant to be redeployed into the part time shift manager role available at the time and that this was not offered to her I am not satisfied this is not a case of genuine redundancy.
SMALL BUSINESS FAIR DISMISSAL CODE
[25] Section 396 requires the determination of whether the dismissal was consistent with the Small Business Fair Dismissal Code before considering the merits. This is not a case of summary dismissal. That being the case the relevant part of the Small Business Fair Dismissal Code falls under the heading ‘Other Dismissal’.
[26] The Respondent did not seek to argue consideration was being given to dismissing the Applicant based on her conduct or capacity, the reason given was always in connection with the role being redundant. It stands to reason there was no warning regarding conduct or performance, or opportunity to respond regarding such a warning. The Applicant was given no notice that a decision had been taken to terminate her and therefore she did not have an opportunity to request a support person to be part of such a discussion. I am satisfied that the Respondent did not comply with the Small Business Fair Dismissal Code.
HARSH, UNJUST OR UNREASONABLE
[27] There is no dispute that the general manager role was gone. The reasons for dismissal of the Applicant were not related to capacity or conduct and accordingly there cannot have been and was not a valid reason for dismissal related to capacity or conduct. However I do not consider a valid reason for termination existed on some other basis because I have found it would have been reasonable in all of the circumstances for the Applicant to have been redeployed. The Applicant was only notified of the decision to terminate at the same meeting she was terminated with notice. Issues of capacity or conduct were not relied upon in the meeting, the employer did not refuse a request for a support person but at the same time no notice regarding the subject of the discussion was given to the Applicant. No warnings were given regarding unsatisfactory performance. The Respondent is a small business and this no doubt impacted on the procedure it adopted, as would have the absence of a dedicated human resource manager. The Respondent had an available alternative in the part time shift manager role which would have been accepted as an alternative to termination had it been offered. The failure to offer the available role in combination with other procedural failings set out above satisfies me the dismissal was harsh unjust or unreasonable.
REMEDY
[28] The Applicant did not press for reinstatement, and said she was seeking 26 weeks pay as compensation, saying she would have worked a further 17 weeks from the time of her termination up until her maternity leave. 32 On the evidence before me I am satisfied that reinstatement would not be practicable in any event.
[29] The Respondent provided some evidence that the business was not as profitable as it had been, and further that it was struggling financially but no specific evidence was provided that an order for compensation would affect the enterprises viability. The Applicants length of service included the entire period that Martin Box had an interest in the business to the date of termination.
[30] This is however a case where the Applicants role was gone and the remuneration that she would have received, or would have been likely to have received if she had not been dismissed was not the remuneration she was receiving at the time of termination but the remuneration she would have received had she been redeployed into the Thursday and Friday shift manager role being paid at $24 per hour for eight hours per day.
[31] There was no clear evidence on mitigation of loss. The Applicant was part way through her pregnancy at the time of termination. I do not intend to make a deduction on account of failure to mitigate. There is no evidence of other remuneration earned by the Applicant from employment or other work during the period between the dismissal and the making of this order for compensation however the Applicant said herself she would have been on maternity leave 17 weeks from the date of termination.
[32] This is not a case where the Applicants conduct or performance fell into question, but more a question of the financial circumstances of the Respondent and the likely period it was viable for her stay in employment. I conclude that it could have been reasonably expected that her employment had she been redeployed into the shift manager role would have persisted for at least another fourteen weeks. I conclude the Applicant should be awarded the equivalent of 14 weeks wages at the Thursday and Friday shift manager rate in compensation plus 9% superannuation. Based on $24 per hour multiplied by 16 hours giving $384 per week multiplied by 14 weeks makes a total of $5,376. From this figure will need to be deducted the three week’s notice paid to the Applicant at the time of termination which was at her former general manager rate of $33.75 per hour multiplied by 40 giving $1,326 multiplied by 3 makes $4,050.00. $5,376 minus $4050.00 equals $1,326.00. This amount does not exceed the compensation cap. An order that the Respondent pay to the Applicant the sum of $1,326.00 gross plus 9% superannuation taxed according to law will be issued with this decision.
COMMISSIONER
Appearances:
C Dillon (Applicant) representing herself.
Mr Box (Respondent) representing Club Box Pty Ltd T/A Club 26
Hearing details:
2012.
Brisbane.
October, 16.
1 Exhibit 3 Statement of Martin Robert Box dated 3 July 2012 paragraph 19
2 Exhibit 3 Statement of Martin Robert Box dated 3 July 2012 paragraph 28
3 Exhibit 3 Statement of Martin Robert Box dated 3 July 2012 paragraph 29
4 Transcript PN 211 - 215
5 Transcript PN 221
6 Transcript PN 56 - 68
7 Transcript PN 80 - 125
8 Michelle Gray v Hamilton James and Bruce Pty Limited [2011] FWAFB 6884)
9 Exhibit 3 Statement of Martin Robert Box dated 3 July 2012 paragraph 8 - 9
10 Transcript PN 156
11 Transcript PN 158
12 Transcript PN 165
13 Transcript PN 172
14 Transcript PN 300
15 Exhibit 3 Statement of Martin Robert Box dated 3 July 2012 paragraph 21
16 Transcript PN 186 - 188
17 Transcript PN 191
18 Transcript PN 192
19 Exhibit 1 Statement of Charmaine Dillon dated 30 May 2012 paragraph 4 - 5
20 Exhibit 1 Statement of Charmaine Dillon dated 30 May 2012 paragraph 10
21 Transcript PN 201
22 Exhibit 1 Statement of Charmaine Dillon dated 30 May 2012 attachment b
23 Exhibit 3 Statement of Martin Robert Box dated 3 July 2012 paragraph 46 - 47
24 Transcript PN 525 -527
25 Exhibit 1 Statement of Charmaine Dillon dated 30 May 2012 attachment e
26 Exhibit 3 Statement of Martin Robert Box dated 3 July 2012 paragraph 65
27 Transcript PN 313
28 Transcript PN 643 - 655
29 Transcript PN 712
30 Transcript PN 390
31 Transcript PN 393
32 Transcript PN 210
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