Clare Ferra v DMC Digital T/A DMC Digital

[2015] FWC 8504

[2015] FWC 8504

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Clare Ferra
v
DMC Digital T/A DMC Digital
(U2015/9511)

DEPUTY PRESIDENT LAWRENCE SYDNEY, 17 DECEMBER 2015

Application for relief from unfair dismissal.

Introduction

[1] On 17 July 2015 Ms Clare Ferra (the Applicant) lodged with the Fair Work Commission (the Commission) pursuant to s.394 of the Fair Work Act 2009 (the Act) an application for a remedy for unfair dismissal against her former employer DMC Digital Pty Ltd (the Respondent).

[2] The Applicant commenced employment with the Respondent on 20 May 2013. She was notified of her dismissal on 3 July 2015 and it took effect on that day.

[3] The Applicant was a video editor with the Respondent’s media production operation at Crows Nest in Sydney. The reason given was her underperformance.

[4] The Applicant submits that the dismissal was a result of bullying by her direct Manager, Luke Campbell. Since early April, the Applicant had been pressing the Respondent to rectify her alleged under-payment. She was then promoted to editor which involved animating the text for retail advertisements created by designers. Luke Campbell criticised her for spelling mistakes which were not a result of her work. She says that there were a number of examples of this after which she complained to human resources. Her complaints were not taken seriously by Human Resources (HR) or Luke Campbell. She was given a formal warning for this. No further meetings took place with Luke Campbell or HR to review progress notwithstanding this being promised.

[5] On 22 June, the Applicant asked to take Friday 26 June off work on annual leave to travel to Melbourne. This was rejected but she says it was verbally agreed that she could finish at 2.00 pm. On the Thursday she was given novel and difficult work. She also had computer problems. As a result, when she left at 6.20 pm the work was not completed. Although she felt sick, she went in early on Friday morning. She told Luke Campbell that it was likely she would not be able to complete the job, became upset and unwell. She then left early. She took four days off, with a doctor’s certificate, as a result of illness caused by stress.

[6] She says that she was terminated for “general underperformance” during an unscheduled meeting. She further says that Luke Campbell told her that she had been dismissed because she did not complete the job on 26 June.

[7] The Applicant submits that unjustified warnings were common in the workplace. They were part of a general culture of bullying and intimidation.

[8] The Respondent says that the Applicant was terminated by letter on 3 July but the decision was taken on 29 June. The reason was for underperformance, specifically continual failure to communicate when work would not be finished on time. She had been formally warned on 13 May.

[9] This warning letter sets out the instances of unsatisfactory performance relating to errors in scripts and lateness of work. It resulted in the implementation of a performance improvement plan.

[10] She was provided with two week’s salary in lieu of notice.

[11] The Respondent says that it gave the Applicant every opportunity to improve her performance. She started the editing job in April but had not been able to master it. It says that Luke Campbell treated her with consideration and respect. She was counselled with respect to the speed with which she worked and the errors in her work. She appeared distracted by working on her own project, using the Respondent’s equipment outside of work hours.

[12] The Respondent disputes the Applicant’s version of the events of 25 and 26 July, in that it denies that it was advised in sufficient time that the work might not get completed, that the Applicant had computer problems or that she was unwell. In fact she was found on her mobile phone for an extended period before she left work.

[13] After the doctor’s certificate was received by the Respondent on 29 June, a decision was taken to terminate the Applicant. The termination took place in the Respondent’s office in a meeting, of which the Applicant had no notice. The Managing Direction, Paul Meredith, who was overseas, was on the telephone. He signed the termination letter.

[14] The Respondent denies that there is a climate of bullying and intimidation in the workplace.

Commission Proceedings

[15] The matter was conciliated on 11 August 2015 but did not settle.

[16] I conducted a telephone programming hearing on 22 September 2015.

[17] The hearing took place on 28 September 2015 in Sydney

[18] The Applicant represented herself. The Respondent was represented by Ms Lynette Pillay.

[19] With the agreement of the parties, the hearing was conducted as a determinative conference.

[20] The Applicant relied on a written submission and a witness statement. She also gave oral evidence as did Ms A. Cave, who also provided a witness statement. Ms Cave was a former employee of the Respondent.

[21] The Respondent relied on a written submission and the witness statements and oral evidence of:

● Lynette Pillay, Office Administrator, DMC Digital

● Luke Campbell, Senior Producer, DMC Digital

● Aine Scott, Senior Producer, DMC Digital

● Vicki Bryant, Administrator/Finance DMC Digital

Protection from Unfair Dismissal

[22] An order for reinstatement or compensation may only be issued where I am satisfied the Applicant was protected from unfair dismissal at the time of the dismissal

[23] Section 382 sets out the circumstances that must exist for the applicant to be protected from unfair dismissal:

“382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

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

(b) one or more of the following apply:

(i) a modern award covers the person;

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.”

[24] The Applicant was covered by a modern award, the Broadcasting and Recorded Entertainment Award [MA000091]. In addition, her salary at $45,800 per annum was well below the high income threshold. It was conceded, therefore, that she was a person protected from unfair dismissal in accordance with s.382 (b)(iii).

[25] Section 396 provides that certain matters must be determined by the Commission before proceeding to deal with the merits of a matter. It provides:

“396 Initial matters to be considered before merits

The FWC must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:

(a) whether the application was made within the period required in subsection 394(2);
(b) whether the person was protected from unfair dismissal;

(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;
(d) whether the dismissal was a case of genuine redundancy.”

[26] None of these matters were at issue in this case. The Respondent had some 20 employees at the time of the dismissal.

Was the dismissal unfair?

[27] A dismissal is unfair if I am satisfied, on the evidence before me, that all of the circumstances set out at s.385 of the Act existed. Section 385 provides the following:

“385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.”

[28] No issue was raised pursuant to s.385(a), (c) or (d).

Harsh, Unjust or Unreasonable

[29] I must consider whether I am satisfied the dismissal was harsh, unjust or unreasonable. The criteria I must take into account when assessing whether the dismissal was harsh, unjust or unreasonable are set out at s.387 of the Act:

“387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

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

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.

The Arguments of the Parties

[30] The Applicant submitted that the dismissal was harsh, unjust and unreasonable because:

● Her alleged underperformance related to her leaving early and not completing work. However, she was ill and the task was new to her.

● She made every effort to complete the task notwithstanding her illness. She stayed late on 25 June and came in early on 26 June.

● She says that she was treated differently to other employees both in respect of the dismissal and the earlier warning she was given. She says she made less mistakes than other editors and was given warnings that were not justified.

● She says that she was never notified of the reason for her dismissal or given an opportunity to respond. Indeed, the Respondent conceded that it had made a decision to dismiss her whilst she was on sick leave. She was given no notice of the meeting on 3 July in which she was dismissed. Moreover, the fact that the Managing Director was on the phone made it impossible for her to respond.

● Given her experience, the job that she was given could not have reasonably been expected to be completed within the time she was given. Luke Campbell did not adequately monitor her work so that he knew its status. On 25 June he gave her additional work towards the end of the day.

● Her termination was in response to her questioning her alleged underperformance. This issue was ultimately resolved but the Applicant submits it is an explanation for the Respondent’s unreasonable behaviour. The correction was in the order of $3,200.

● Annie Cave, who was formerly employed by the Respondent as a junior editor, gave evidence of the accuracy of the Applicant’s work. She believes that the Applicant was unfairly targeted. She says that the warning that the Applicant received was unreasonable given the minor nature of the errors and the way that other employees were dealt with. She provided corroboration with respect to the bullying behaviour of Luke Campbell towards the Applicant and other female employees. Finally, she had issues with respect to underpayment of wages by the Respondent herself.

[31] The Respondent submitted that the Applicant’s dismissal was not harsh, unjust or unreasonable because:

● Despite the performance improvement plan put in place, the Applicant failed to develop as an editor after her promotion to that position in April.

● The Respondent had exhausted all avenues in training and supporting the Applicant in the role.

● The Applicant had been given three warnings in her role as a “dubber”, prior to her promotion to editor, over a period of 18 months. Copies of these were provided to the Commission.

● All employees are required to take responsibility for their errors but the Applicant did not do so.

● Lynette Pillay, in her evidence, denied that the wages underpayment claim by the Applicant had any link to her dismissal.

● It is apparent that the termination letter was provided to the Applicant in the meeting on 3 July. The Respondent had an opportunity of responding during the meeting. An email dated 26 June to other staff makes it clear the decision to terminate had already been taken.

● Luke Campbell’s evidence was that attention to detail was an important aspect of the editor’s responsibility. This is where the Applicant had fallen short. He denies that he put unreasonable pressure on her or harassed her in any way. He says that she was not communicative as to the status of her work including on 25 and 26 June. It is clear that the decision to terminate was made soon after the incident on 26 June.

● Aine Scott provided supervision to the Applicant as well. Her evidence was supportive of the Applicant’s record of making mistakes and inability to complete jobs on time. She says that three months in the editor’s job was sufficient to determine whether she was able to adequately perform the role. The Applicant would have been informed of her termination on 29 June if she had returned to work. Instead she was ill. Finally, Ms Scott denied that Luke Campbell had harassed the Applicant or treated her differently to other employees.

Approach of the Commission

[32] The ambit of the conduct which may fall within the phrase ‘harsh, unjust or unreasonable’ was explained in Byrne v Australian Airlines Ltd [1995] HCA 24; (1995) 185 CLR 410 at 465 by McHugh and Gummow JJ as follows:

“... It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.”

[33] Vice President Ross, as he then was, in B Rose v Telstra Corporation Limited (1998) Q9292 (Rose) restated the above proposition and also stated:

“In my view whether there has been a `fair go all round’ is a matter which I think is relevant and hence I am to have regard to it determining whether the termination was harsh, unjust or unreasonable. It is not necessarily determinative but it is a factor to be taken into account.”

[34] There was a dispute about the facts in this case and a conflict of evidence. In addition, where the Applicant admitted to mistakes in editing there is a contest as to the weight that should be placed on these errors. Were they sufficient to justify the warnings and ultimately dismissal that the Respondent implemented? There are also issues as to the appropriateness of the procedure adopted by the Respondent, leading up to the dismissal.

Valid Reason - s.387(a)

[35] In Container Terminals Australia Limited v Toby [2000] Print S8434, a Full Bench said ‘In our view, the consideration of whether there was a valid reason for termination is a separate issue from the determination of whether a termination was harsh, unjust or unreasonable’.

[36] Northrop J in Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371 said:

“In its context in s.170DE(1), the adjective “valid” should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s.170DE(1). At the same time the reason must be valid in the context of the employee’s capacity or conduct, or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must ‘be applied in a practical, commonsense way to ensure that the employer and employee are each treated fairly ...”

[37] In Parmalat Food Products Pty Ltd v Wililo, [2011] FWAFB 1166, the Full Bench held:

“The existence of a valid reason is a very important consideration in any unfair dismissal case. The absence of a valid reason will almost invariably render the termination unfair. The finding of a valid reason is a very important consideration in establishing the fairness of a termination. Having found a valid reason for termination amounting to serious misconduct and compliance with the statutory requirements for procedural fairness it would only be if significant mitigating factors are present that a conclusion of harshness is open.”

[38] The Full Bench majority in B, C and D v Australian Postal Corporation T/A Australia Post [2013] FWCFB 6191 provides a useful summary of the approach to be taken by the Commission in weighing the factors to be considered under s.387:

“[20] Northrop J’s reasoning anticipated the reasoning of the High Court in Victoria v Commonwealth – that s.170DE(2) by its operation could render invalid a reason that would otherwise have been a valid reason. The fact that some dismissals are “harsh, unjust or unreasonable” notwithstanding the existence of a “valid reason” means that the class of dismissals that are “harsh, unjust or unreasonable” is greater than the class of dismissals where there is no “valid reason” for the dismissal.

[21] Section 387 specifies a range of matters that must be considered in each case. Section 387(h) requires consideration of “any other matters that FWA considers relevant”. In any given case, there will be a range of matters, beyond those specified in s.387(a) to (g), that rationally bear upon whether the dismissal is “harsh, unjust or unreasonable” and thus are “relevant matters” that must be considered pursuant to s.387(h).

[22] Often it will not make any difference to the ultimate outcome whether a particular circumstance is considered pursuant to s.387(a) in determining whether there is a valid reason, or as a relevant matter pursuant to s.387(h), leading to the ultimate determination of whether the dismissal was “harsh, unjust or unreasonable”. However, in some cases it may matter greatly. That will tend to be so when the particular misconduct, shorn of the personal circumstances of the employee and the broader context beyond the particular acts or omissions that are said to constitute the misconduct, is clearly a matter that a reasonable employer is entitled to take seriously. This is such a case.

...

[34] In considering whether there was a valid reason for a dismissal under s.387(a), the reason(s) being considered are the employer’s reason(s). In a misconduct case, the Commission is concerned with whether the misconduct in fact occurred, not with whether the employer has reasonable grounds to believe that it occurred (eg. Yew v ACI Glass Packaging Pty Ltd (1996) 71 IR 201, Sherman v Peabody Coal Ltd (1998) 88 IR 408; Australian Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1). “

[35] Subject to that, as indicated by Northrop J in Selvachandran, “valid reason” is assessed from the perspective of the employer and by reference to the acts or omissions that constitute the alleged misconduct on which the employer relied, considered in isolation from the broader context in which they occurred. It is the reason of the employer, assessed from the perspective of the employer, that must be a “valid reason” where “valid” has its ordinary meaning of “sound, defensible or well founded”. As Northrop J noted, the requirement for a valid reason “should not impose a severe barrier to the right of an employer to dismiss an employee”.

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

[58] Reaching an overall determination of whether a given dismissal was “harsh, unjust or unreasonable” notwithstanding the existence of a “valid reason” involves a weighing process. The Commission is required to consider all of the circumstances of the case, having particular regard to the matters specified in s.387, and then weigh:

(i) the gravity of the misconduct and other circumstances weighing in favour of the dismissal not being harsh, unjust or unreasonable;

against

(ii) the mitigating circumstances and other relevant matters that may properly be brought to account as weighing against a finding that dismissal was a fair and proportionate response to the particular misconduct.”

[39] I respectfully adopt this approach.

[40] The Applicant admits that she made errors during her employment. Her defence, in general, is that the culture of the Respondent was such that these errors were not significant enough to justify the warnings that she received. She further says that she was a victim of a campaign of deliberate harassment and victimisation by Luke Campbell. Here there is a conflict between the Applicant and Ms Cave’s evidence and the Respondent’s witnesses. Strict and rather inflexible practices by an employer can be interpreted by an employee who is having difficulty coping with a job and under stress as harassment.

[41] I am satisfied that there was not harassment and victimisation of the Respondent by Luke Campbell. It is apparent, however, that the Respondent had quite a strict approach to discipline. Employees were given formal warnings for textual and spelling errors after quite short periods in positions. It is doubtful, in my view, that all of these warnings were reasonable. Nevertheless, the Applicant had been given a written warning that made it clear that dismissal was a possible consequence of her next infringement.

[42] As to the events of 25 and 26 June, the Applicant’s defence to the allegation that she did not complete the job so that she could leave early was her illness. She also submits that the job given to her was new and that this made the task harder.

[43] Luke Simpson, in his evidence, gave some support to this point, see the following transcript:

“So the fact that I was sick is incompetence?  -No, the incompetence came because you weren’t able to go back and complete the job, and then after that you went and you took leave and you were obviously visibly upset, and we allowed you to leave the business.

You mentioned that there was the proviso that everything would be finished before I left. Now at the time you gave me this, the nature of the work to be completed was unknown. Is that correct?  -No, I think the understanding was the fact that at a minimum what we would call a base cut would be done for the Gourmet Institute job. If it didn’t get to that, that was something that we could - obviously which we started discussions with but weren’t able to complete because that was going to be reassessed at 1 pm.

That’s in contradiction to your F3 statement. So at the point where you granted me leave to leave early - - -?  -So may I ask, the F3 statement is - that was in - - -

This is the responses, so DMC’s - the company’s response - - -

THE DEPUTY PRESIDENT: The company’s response to the application.

MS FERRA: So it says - so this was prior to the Friday I asked to leave early and you said that, or whatever, DMC said, I was able to leave early on the basis that I was able to complete work before leaving the office. The content of what work was required was not discussed at that point as it was unknown. So when you granted me the leave, it was not known what I would be doing. Is that correct?  -No, because on Thursday prior to, the question was asked to yourself would the work be completed and you said yes, and that it was going fine.

Yes, but the work - what that exact work was, was unknown at that point?  -No, because I sat down to you on the Thursday prior to asking do you feel that you’d be able to get them all done and the answer was yes.

That’s not what it says here. It says that you granted leave on the proviso that I was able to complete the work before leaving the office?  -Sorry, are you talking from the Monday, sorry.

Yes?  -From the Monday the - - -

Initially you granted - you did not know what the work would be?  -On the Monday, no, we didn’t know exactly. It could have been two things which was we thought maybe Gourmet Institute or some retail TVCs.

But regularly on a day to day basis it was my duty to edit three TVCs. Is that correct?  -No, the majority of your work was TVCs but the work that you were delegated is whatever the producer chooses you can do.

Yes, but Gourmet Institute was quite outside of my regular - the regular tasks that I completed?  -Well I disagree because in your job description which you received when you created - when you were given the role, it says:
As an editor is responsible for the management and assembly of a project assets throughout the life cycle of a job resulting in an accurate piece of visual communication. The role encompasses assembly of retail TVCs, corporate videos, reels and long form work.

I certainly feel that work was inside of that and it says “tasks are included but not limited to”, and it lists some other things which I’ll stated:

Editing of graphic based retail commercials to final master as briefed, ensuring all aesthetic spelling and technical aspects of the TVC are correct before mastering. Assets management of editing of creative TVCs incorporating footage and music.

So that job isn’t outside the role and it was - sorry, it is certainly something that shouldn’t have been overly foreign considering it was asked that you were to take time with senior editors to get up to speed with that solo work.

So irrespective of what the job description says, my regular duty at DMC was to edit 15 to 30 second TVCs and I have notes from a meeting that acknowledge that I was unfamiliar with the work, and this was prior to me being given that task. It says, page 28 of my document, “Clare needs” - - -

THE DEPUTY PRESIDENT: Well, the witness - if you’re going to ask something about another document you’ll need to show the other document to the witness.

MS PILLAY: I’ve got it open.

THE DEPUTY PRESIDENT: That’s all right, so again, just refer for the transcript what you’re referring to - - -

MS FERRA: So I’m just referring to page 28 of my submission, “GP workshop notes 2015”, it says:

Clare needs to sit in with Michael doing Gourmet Institute edits to familiarise herself with the kind of work and get up to speed with that workflow.

Is that not an acknowledgment that I was unfamiliar with the work given to me on Friday, the 26th - I mean sorry, Thursday the 25th?  -Yes, yes, definitely not familiar as other editors within the business but that was also - it’s not something that you haven’t been - that you weren’t aware of and that you hadn’t been across previous to that point. So it’s not unusual for you to receive that style of work.

So this statement says that I need to sit in with Michael, so this acknowledges that I needed training in this, yet you tasked me with completing it by myself. Why did you do this?  -Well you did - you had cut recipes prior to, so you had assisted. I believe Annie definitely assisted her with doing Gourmet Institute, so you were familiar with the work but you also need to get up to speed by spending more time with more senior editors, and that’s what that statement was about. So developing yourself.

Yes, so I did - I did that practice prior to this meeting. So at the time of this meeting you said that I still needed to sit in with another editor doing these edits, yet you tasked me with completing it on my own, unassisted after hours. Is that not correct?  -Yes.

Yes. So despite the fact that I needed training you gave me that task by myself?  -No, there was an event prior to that that you were asked - you were asked to sit on, so this document we were asking for you to familiarise yourself with this edit. It had been communicated that you needed to be on that edit and there was an event prior - after this that you should have been sitting on.”

[Transcript PN381 – PN406]

[44] The Applicant also points out that she did stay back the night before.

[45] There is a discrepancy in the evidence as to when the Applicant told the Respondent on 26 June that she may not be able to finish the job. In my view, it was Luke Campbell’s responsibility to monitor her. One would have thought this would have happened, given that she was under a performance plan.

[46] The decision to dismiss the Applicant was taken by those below the Managing Director even though he signed the letter of termination and told the Applicant of the dismissal by telephone, in the 3 July meeting. This is clear from the exchange of emails referred to above and the evidence of Luke Campbell. It seems to me likely that the decision was taken out of frustration with the Applicant’s lack of progress as an editor and frustration at her querying of her underpayment as much as the events of 25/26 June.

[47] In any event, the Applicant did admit to making mistakes and she was in receipt of a number of warnings, including a final warning. For this reason I find that there was a valid reason for dismissal.

Notification of a valid reason – s.387(b)

[48] Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made, Chubb Security Australia Pty Ltd v Thomas Print S2679 at [41] in explicit terms, Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, 151 and in plain and clear terms, Presvisic v Australian Quarantine Inspection Services Print Q3730. In Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137 a Full Bench of the Australian Industrial Relations Commission dealing with similar provision of the Workplace Relations Act 1996 stated the following:

“[73] As a matter of logic procedural fairness would require that an employee be notified of a valid reason for their termination before any decision is taken to terminate their employment in order to provide them with an opportunity to respond to the reason identified. Section 170(3)(b) and (c) would have very little (if any) practical effect if it was sufficient to notify employees and give them an opportunity to respond after a decision had been taken to terminate their employment. Much like shutting the stable door after the horse has bolted.” Ibid at 151.

[49] The Applicant provided the following explanation of what occurred at the meeting on 3 July:

“THE DEPUTY PRESIDENT: Can you just help me? By describing in your words, what happened on Friday 3 July?

MS FERRA: Do you mean the 26th?

THE DEPUTY PRESIDENT: No, the day that you were terminated.

MS FERRA: Okay, yep. So I worked that morning and then what happened is I came back from lunch and Luke said to me we have a meeting in the other room. I asked, “What is it regarding,” and he said, “Paul is on the phone,” which you know, obviously doesn’t really explain anything. I walked into the room, answered the phone and I was just told, “You are fired for under performance.” After I got on the phone I sat down and Lynette gave me my leave entitlements on a piece of paper and she went through them and then she said - I asked, “May I ask why?” and I remember I asked those exact words. And then Luke said, “Because you left early and it was that you didn’t finish Gourmet Institute”. Then, after that, I was asked by Lynette, and it was only as an after note, “Do you have anything to say?” Then I said, “No”. It just caught me completely by surprise. It was literally an ambush meeting, and the fact that it caught me completely by surprise, I said, “You’ve made your decision”. Then she said, “You can stay another 30 minutes and say your goodbyes or leave” then I said, “I’d rather leave”.

THE DEPUTY PRESIDENT: There was a letter of termination, which is dated that day. When did you - - -

MS FERRA: It was handed to me on that day, during the meeting.

MS PILLAY: I think that’s the piece of paper she’s referring to I handed to her.

THE DEPUTY PRESIDENT: The termination letter, which had been prepared.

MS FERRA: Yes.”

[Transcript PN666 – PN674]

[50] Ms Pillay provided the following account also:

“MS PILLAY: On 3 July, Clare had gone to lunch and the managing director was going to issue Clare with termination. The termination had been decided beforehand, due to the lack of responsiveness on performance and improvement. The managing director, Paul Meredith, called in and spoke to Clare. I was present in the room. Luke Campbell was present in the room. I have no knowledge of what was spoken on the phone. I handed Clare the letter after the phone call. I asked Clare did she have anything further to say. She said, “No. I’ve just been sacked.” She did refer to Luke Campbell and asked him why and Luke said it was a combination of her underperformance over the course of time and she shouldn’t have been unaware that it was coming. I can’t recall the length of time that I told her that she could remain in the company, but we asked her if she could say her goodbyes and just leave.

[Transcript PN687]

[51] Based on these accounts and the evidence of Mr Campbell and Ms Scott, it is clear that the decision to dismiss was taken shortly after 26 June. Ms Scott said the Applicant would have been dismissed on 29 June but for the fact that she was off work ill. The letter of dismissal was prepared well in advance.

[52] I find therefore that the Respondent acted contrary to s.387(b). The Applicant was not notified of the reason for dismissal before the decision was taken. There was ample opportunity for the Respondent to do so but it did not.

Opportunity to respond s.387(c)

[53] An employee protected from unfair dismissal must be provided with an opportunity to respond to any reason for dismissal way to ensure the employee relating to the conduct or capacity of the person. This criterion is to be applied in a common sense is treated fairly and should not be burdened with formality RMIT v Asher (2010) 194 IR 1, 14-15.

[54] It follows that the Applicant had no real opportunity to respond to the reason for the dismissal. The decision had already been made. As well, the fact that the Managing Director was overseas and dealing with the issue rather cursorily on the telephone emphasises the point.

Unreasonable refusal by the employer to allow a support person – s.387(d)

[55] Where an employee protected from unfair dismissal has requested a support person be present to assist in discussions relating to the dismissal, the employer should not unreasonably refuse that person being present.

[56] There is no evidence that the Applicant requested a support person to be present. On the other hand, she was given no opportunity to do so given the nature of the meeting.

Warnings regarding unsatisfactory performance – s.387(e)

[57] The Applicant had been given previous warnings about her performance so this provision is satisfied.

Impact of the size of the Respondent on procedures followed – s.387(f)

[58] The Respondent had 20 or so employees but I find that, although just over the threshold of a small business, the size of the business did contribute to the procedural failures. It does not excuse them, however.

Absence of dedicated human resources management specialist/expertise on procedures

followed - s.387(g)

[59] The lack of human resources specialists did contribute to the procedural failures.

Any other matter that the FWC considers relevant

[60] Section 387(h) allows the Commission to consider any other matters it considers relevant. These must be considered in the context of the object of Part 3 - 2 of the Act contained in s.381(2) to “ensure that a ‘fair go all round’ is accorded to both the employer and the employee concerned”.

[61] In my view, whilst the Applicant was guilty of mistakes in editing, this did not justify the sanction of dismissal. The culture of the Respondent appears to be one of formal disciplinary procedures being implemented on a regular basis for work errors that should be dealt with by counselling, mentoring and additional training. The Applicant had only been an editor for three months. Whilst she may not have developed as quickly as the Respondent desired, the sanction of dismissal was harsh and unfair, in my view. Other sanctions could have been implemented as well as additional training and support.

[62] For these reasons, notwithstanding my finding that there was a valid reason for the dismissal, I find that the dismissal of the applicant was harsh, unjust and unreasonable. Accordingly, I find that the dismissal was unfair within the terms of s.385.

Compensation

[63] Having found that the dismissal was unfair, I now turn to the appropriate remedy.

[64] Section 390 of the Act sets out the circumstances in which I may make an order for reinstatement or compensation:

“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.”

[65] The Applicant does not seek reinstatement and it would not be appropriate given her relationship with the Respondent’s managers.

[66] Section 390(3)(b) provides that I may only issue an order for compensation to the Applicant if it is appropriate in all the circumstances.

[67] I have found that the applicant has been unfairly dismissed and that reinstatement is not appropriate in all the circumstances. I am satisfied that an order for compensation should be made.

[68] Section 392 of the Act sets out the circumstances that must be taken into consideration when determining an amount of compensation, the effect of any findings of misconduct on that compensation amount and the upper limit of compensation that may be ordered provides:

“392 Remedy—compensation

Compensation

(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

Criteria for deciding amounts

(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

(a) the effect of the order on the viability of the employer’s enterprise; and

(b) the length of the person’s service with the employer; and

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

(g) any other matter that the FWC considers relevant.

Misconduct reduces amount

(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

Shock, distress etc. disregarded

(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.

Compensation cap

(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

(a) the amount worked out under subsection (6); and

(b) half the amount of the high income threshold immediately before the dismissal.

(6) The amount is the total of the following amounts:

(a) the total amount of remuneration:

(i) received by the person; or

(ii) to which the person was entitled;

(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and

(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.”

[69] The method for calculating compensation under s.392 of the Act was dealt with by a Full Bench of the Commission in Bowden, G v Ottrey Homes Cobram and District Retirement Villages Inc. T/A Ottrey Lodge,[2013] FWCFB 431 (Bowden). In that decision the Full Bench set out the order in which the criteria and other factors should be applied, taking into account authority under the Workplace Relations Act 1996 in Sprigg v Paul’s Licensed Festival Supermarket, (1998) 88 IR 21 and Ellawala v Australian Postal Corporation, Print S5109 (Ellawala). I have adopted the methodology utilised in Bowden in determining the amount of a payment of compensation.

[70] I will now consider each of the criteria in s.392 of the Act.

Remuneration that would have been received: s.392(2)(c)

[71] The Applicant earned $45,800 per annum. Given the issues that had arisen it is difficult to see that her employment would have continued for a long time.

[72] I determine that the period of time the Applicant would have remained employed by the Respondent, or would have likely remained employed with the Respondent, had she not been dismissed is three months. The remuneration she would have received is therefore $11,450.

Remuneration earned s.392(e)

[73] The Applicant earned only a small amount since the dismissal but this is because she set up her own business. I have not made an adjustment on this ground however.

Income likely to be earned: - s.392(2)(f)

[74] This matter is not relevant.

Other matters: - s.392(2)(g)

[75] There are no other matters that I consider appropriate to consider.

Viability: - s.392(2)(a)

[76] This matter is not relevant.

Length of Service: - s.392(2)(b)

[77] The Applicant’s short service is not a factor which can be taken into account.

Mitigating efforts: - s.392(2)(b)

[78] In considering whether the Applicant has taken steps to mitigate the loss suffered as a result of the dismissal I should take into account whether the Applicant acted reasonably in the circumstances, (Ellawala).

[79] I consider that the Applicant has not taken steps to mitigate her loss by seeking comparable employment. The compensation will be reduced to $8,000 on this basis.

Misconduct: s.392(3)

[80] No adjustment to the compensation is appropriate on this ground.

Shock, Distress: s.392(4)

[81] I note that the amount of compensation calculated does not include a component for shock, humiliation or distress.

Compensation cap: s.392(5)

[82] I must reduce the amount of compensation to be ordered if it exceeds the lesser of the total amount of remuneration received by the Applicant, or to which the Applicant was entitled, for any period of employment with the employer during the 26 weeks immediately before the dismissal, or half the amount of the high income threshold immediately prior to the dismissal.

[83] The high income threshold component is $68,350.

[84] The amount of compensation I will order does not exceed the compensation cap.

[85] I will order the Respondent to pay to the Applicant an amount of $8,000.

Conclusion

[86] I am satisfied that the Applicant was protected from unfair dismissal, and that the dismissal was unfair and a remedy of compensation is appropriate. In accordance with s.381(2) of the Act, I am further satisfied that each party has been accorded a ‘fair go all round’.

[87] An order (PR575187) will be issued with this decision.

DEPUTY PRESIDENT

Appearances:

C. Ferra, self-represented Applicant.

L. Pillay for the Respondent.

Hearing details:

2015

Sydney:

September 28.

Printed by authority of the Commonwealth Government Printer

<Price code C, PR574868>