Clint Coorey v Australia Tile Wholesale Pty Ltd
[2023] FWC 927
•24 APRIL 2023
| [2023] FWC 927 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Clint Coorey
v
Australia Tile Wholesale Pty Ltd
(U2023/150)
| COMMISSIONER MCKINNON | SYDNEY, 24 APRIL 2023 |
Application for an unfair dismissal remedy – whether genuine redundancy – whether dismissal consistent with the Small Business Fair Dismissal Code – whether dismissal harsh, unjust or unreasonable – compensation ordered
Until December 2022, Mr Clint Coorey and Mr Nick Burton, General Manager of Australia Tile Wholesale Pty Ltd (ATW), were “best mates”. At that time, they were the only two employees of ATW. Mr Coorey was employed in the role of Sales Manager/Sales Representative (Wholesale Division), a role he began in November 2021. From approximately June 2022, he also performed warehouse duties. On 16 December 2022, Mr Coorey was dismissed. On 6 January 2023, he applied in time for an unfair dismissal remedy under section 394 of the Fair Work Act 2009 (the Act).
Mr Coorey is protected from unfair dismissal because at the time of dismissal: he had completed the minimum employment period of 12 months as an employee of ATW (a small business employer); he was covered by the Storage Services and Wholesale Award 2020 (the Award); and his gross weekly earnings of $1,346.15 placed him below the relevant high income threshold.
ATW submits that the dismissal was consistent with the Small Business Fair Dismissal Code (the Code) but also that it was a case of genuine redundancy. The Code does not apply to redundancies.
The questions for decision are firstly, whether the dismissal was a case of genuine redundancy; secondly, if the dismissal was for reasons other than redundancy, whether the dismissal was consistent with the Code; and finally, if necessary to answer, whether Mr Coorey was unfairly dismissed.
I have decided that the dismissal of Mr Coorey was not a case of genuine redundancy. The dismissal was not consistent with the Code. Mr Coorey was unfairly dismissed by ATW and compensation is the appropriate remedy. These are my reasons.
Relevant facts
There is no written contract of employment between Mr Coorey and ATW. Because Mr Coorey came to work with Mr Burton as a friend, their arrangement was more of a ‘handshake deal’. Mr Coorey offered to work with Mr Burton to build up the wholesale side of the business. A commission arrangement was agreed, such that no commission would be payable for the first six months of Mr Coorey’s employment, and a commission of 1.5% of total sales would be payable to Mr Coorey after that time. There was no minimum sale amount required to qualify for this commission, despite Mr Burton’s assertions to the contrary. In this respect, I prefer the evidence of Mr Coorey. Despite the handshake agreement, no commission appears to have been paid to Mr Coorey in relation to his employment with ATW.
On Tuesday 6 December 2022, Mr Coorey and Mr Burton had a text message exchange in which Mr Burton accused Mr Coorey of asking “stupid questions” and “laziness” – the latter in relation to the failure to put away two boxes of tiles, each weighing 40-45 kilograms, that were now broken. Mr Coorey responded disputing the accusations. It is clear that he did not appreciate the message from Mr Burton, because at the end of his text message in reply, he wrote:
“Lol laziness ya reckon tho. How bout we have a chat when you get here”
On Monday 12 December 2022, Mr Coorey asked Mr Burton about the commission he believed he was owed and when it would be paid. For four days, Mr Burton did not reply to the request.
Instead, at 5.21pm on Friday 16 December 2022, Mr Coorey was dismissed by text message from Mr Burton. It is necessary to set out the text message in full:
“Ok, you wanted to get a rise out of me, it worked. I’ve been out here working like a dog all week to try and keep the money rolling in so we can get through to the end of the year… I just wanted to be left alone until the end of the year so I can clear my head and figure out what I’m gonna do. My heads clouded and full of stress because of the company. The stress doesn’t come from my side, it comes from your side, because every month we are losing money having you employed in the wholesale. I’m trying to help out and figure out a way to get the wholesale sales up, so we can be relieved of pressure, just wanted to make it to the end of the year so I could clear my head and maybe re adjust [sic] the business, but it seems your [sic] adamant on making a scene about your so called commission…
Your sales for the year was 510k, average of 42k. The yearly target was 960k. Nearly half the budget… Previous years of wholesale sales were 476k in 2020, and 366k in 2021 covid year. So you have pretty much sold the same as 2020, but the difference is there is an extra wage… I was going to go into full details as to why your sales are terrible, but there’s no point even trying to explain because you wouldn’t understand.
You get paid commission based on making budget. You made budget in 1 month of the year, in March, the budget was 55k, and you sold 58,781.10. So you will get paid $881.72 “commission” for that month.
In the end of the day, the sales are not good enough, and your position is losing money, every month. So unfortunately the company cannot keep you employed anymore.
The company will pay you:
- this weeks pay
- 2 weeks pay
- your annual leave (around 125ish hours)
- $881.72 in commission for March.
Drop the Ute, phone, laptop etc off to the warehouse tomorrow, leave the keys etc on the desk, and the Ute in the parking spot. And put the warehouse keys back where they are usually kept.”
On 21 December 2022, Mr Burton sent Mr Coorey a letter of termination. The covering email said:
“Hi Clint,
Please see attached redundancy letter. This is a template from the fair work ombudsmen [sic]. As per the fair work regulations as seen on ( there is a requirement to pay 2 weeks notice from the 16.12.22. As stated by fair work, we are a small business, and there is no requirement for a small business with less than 15 employees to pay a redundancy package. We have posted a photo of the requirements of redundancy as per fair work.
[photo omitted]
ATW will also pay $881.72 as stated, in commission. The grand total of $3574.02 plus your annual leave, which is around 125 hours, will be paid this Friday 23.12.22 which is the next pay cycle.
In order to process the payment, we must receive back ALL work-related materials such as Phone, Car, Drill, Laptop, etc, and any other associated tools. I have instructed you on the 16.12.22 to return everything back, and then again on the 20.12.22 and yet to receive anything back. We require the goods to be returned to the warehouse by 5pm today, as per the instructions that were sent to you in text message twice.”
The letter of 21 December 2022 (dated 16 December 2022) said this:
“Dear Clint
Termination of your employment by reason of redundancy
The purpose of this letter is to confirm the outcome of a recent review by Australia Tile Wholesale of its operational requirements, and what this means for you.
As a result of business slowing down due to slow sales the position of Sales Representative is no longer needed. Regrettably, this means your employment will terminate. This decision is not a reflection on your performance.
Australia Tile Wholesale has tried to find other suitable positions within the company, however since the company is restructuring and changing the business model for 2023, this means there is no longer any positions available.
Your employment will end immediately. Based on your length of service, your notice period is 2 weeks as per fair works guidelines regarding redundancy for small businesses. See the fair work fact sheet ( for more information. In lieu of receiving that notice, you will be paid the sum of $2692.30.
You will also be paid $881.72 in commission. A total of $3574.02 plus your annual leave will be paid this Friday.”
Mr Coorey was paid 2 week’s wages in lieu of notice of termination, and his accrued annual leave. He was not paid the commission amount of $881.72. In my view, the commission was not payable in any event as it related to sales within the first 6 months of Mr Coorey’s employment.
Was the dismissal a case of genuine redundancy?
Did ATW no longer require Mr Coorey’s job to be performed by anyone because of changes in its operational requirements?
The reason for dismissal is apparent from the text message Mr Burton sent to Mr Coorey on 16 December 2022. Mr Burton was stressed due to financial pressure on the business. When Mr Coorey asked him about payment of commission (which he estimated was approximately $7,500), this increased Mr Burton’s stress. Mr Burton became upset and decided to dismiss Mr Coorey both because his sales were poor and the wholesale division of the business was losing money. I find that Mr Burton no longer required Mr Coorey’s job to be performed by anyone because of a change in its operational requirements – being the decision to no longer employ a salesperson in the wholesale division.
Failure to consult under the Award
A dismissal will not be a genuine redundancy for the purposes of the Act unless ATW complied with relevant consultation obligations under the Award.[1] However, in this case I do not consider that the Award required ATW to consult with Mr Coorey in relation to his dismissal.
Clause 30 of the Award applies if an employer makes a definite decision to make major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees. In the context of ATW’s business, the decision to no longer employ Mr Coorey was not a decision to make a major change that was likely to have significant effects on “employees”. It only affected one employee, being Mr Coorey.
Reasonable redeployment
A dismissal is not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise or that of one of its associated entities. Mr Coorey submits that he could have been redeployed to the vacant warehouse worker position advertised a few weeks after he was dismissed. I agree with this submission.
Despite the contents of the ‘template’ letter sent by ATW to Mr Coorey, including that it had “tried to find other suitable positions within the company” and that there was “no longer any positions available”, there was an available warehouse position, and Mr Coorey had been performing work of that kind since June 2022, although not on a full-time basis.
It would have been reasonable to redeploy Mr Coorey within ATW to the position of warehouse worker. It follows that the dismissal was not a case of genuine redundancy.
Was the dismissal consistent with the Small Business Fair Dismissal Code?
The dismissal was not consistent with the Code, because the Code does not apply to redundancies. While the dismissal was not a case of genuine redundancy, it was nevertheless a redundancy. At the time of dismissal, ATW no longer required Mr Coorey’s role to be performed by anyone. It does not matter that some or even all of his duties were taken on by Mr Burton, who also continued to perform his role as General Manager.
Was the dismissal harsh, unjust or unreasonable?
Whether a dismissal was harsh, unjust or unreasonable depends on an assessment of all the relevant facts and circumstances, including those set out in section 387 of the Act. Those are considered in turn.
Was there a valid reason for the dismissal related to capacity or conduct, and was it notified to Mr Coorey?
I find that there was a valid reason for the dismissal of Mr Coorey on the basis that ATW no longer required his role to be performed by anyone, for the reasons above. Mr Coorey’s sales performance was a contributing factor to the decision to make his role redundant, and in this sense the reason for dismissal was related to his capacity to perform the role. The reason for dismissal was notified to Mr Coorey on 16 December 2022 in the text message from Mr Burton.
Was there an opportunity to respond to any capacity or conduct related reason?
There was no opportunity for Mr Coorey to respond to the reasons given for his dismissal. He was dismissed without prior notice or warning, and with immediate effect.
Was there any unreasonable refusal to allow a support person to be present to assist at any discussions relating to dismissal?
There was no unreasonable refusal to allow Mr Coorey to have a support person to assist in discussions about the dismissal. There was no discussions about the dismissal.
Was Mr Coorey warned about relevant unsatisfactory performance?
Mr Coorey was not warned about unsatisfactory performance before he was dismissed. I reject Mr Burton’s submissions to the contrary and find Mr Coorey’s submission on the matter to be more credible because it is consistent with his obvious surprise at being dismissed without notice or warning on 16 December 2022.
Degree to which the size of the employer’s business and any absence of dedicated human resources management specialists or expertise in the business would be likely to impact on procedures followed in effecting the dismissal
The size of ATW suggests that it had no human resources or other specialist expertise to assist with the process of bringing an end to Mr Coorey’s employment. This is likely why there was no procedural fairness in relation to the dismissal – together with the fact that the relationship between Mr Burton and Mr Coorey was more personal than professional.
Other relevant matters
Mr Coorey was paid 2 week’s wages instead of notice of termination. Redundancy pay was not payable to Mr Coorey because ATW was a small business employer.
I accept that Mr Coorey’s request to be paid commission was a contributing factor to the decision to dismiss. However, it was not the only reason. The explanation given by Mr Burton on 16 December 2022 reveals a much more complex picture: of a business division not living up to expectations, despite the best intentions of two close friends, and the breaking down of that relationship alongside an increase in financial pressure.
Conclusion on the merits
I find that Mr Coorey was unfairly dismissed. While there was a valid reason for dismissal, the dismissal itself was unreasonable because it was entirely lacking in procedural fairness.
Compensation
Reinstatement is not an appropriate remedy in this case because the relationship between Mr Burton and Mr Coorey has broken down. Compensation is instead the appropriate remedy.
Section 392(2) of the Act deals with how compensation is to be assessed in connection with an unfair dismissal. The established methodology is elaborated on in Bowden v Ottrey Homes Cobram and District Retirement Villages Inc.[2]
Viability (s.392(2)(a))
There is some material before me to indicate that an order for compensation will affect the viability of ATW, at least in relation to its wholesale division. However, ATW appears to have access to funds to continue to trade and to pay a small additional amount to Mr Coorey in the name of commission. No adjustment is made to the assessment of compensation on this basis.
Remuneration Mr Coorey would have received, or would have been likely to receive, if not dismissed (s.392(2)(c))
Had he not been dismissed, and instead been offered the warehouse role, it is likely that Mr Coorey would have remained in employment with ATW for a further six weeks, until the end of January 2023. I do not think it is likely that Mr Coorey’s tenure in the warehouse would have lasted much longer, given Mr Burton’s expressed opinions about his unsuitability for the role.
Mr Coorey’s weekly wage was $1,346.15 gross. I find that Mr Coorey would have earned $8,924.97 gross (the equivalent of 6 week’s pay plus superannuation) had he not been dismissed.
Remuneration earned (s.392(2)(e)) and income reasonably likely to be earned (s.392(2)(f))
Mr Coorey was paid 2 week’s wages instead of notice of termination. He has not earned any other income since the dismissal. The amount of compensation is reduced on this basis by the equivalent of 2 week’s wages (plus superannuation), to $5,949.98 gross.
Length of service (s.392(2)(b))
Mr Coorey’s period of service was approximately 13 months. No adjustment is made in relation to the assessment of compensation on this account.
Mitigation efforts (s.392(2)(d))
Mr Coorey submits that he has applied for multiple jobs since the dismissal without success. While this is difficult to understand in the current labour market, particularly in relation to sales and warehouse-type roles, there is no evidence to contradict the submission. It does not affect the assessment of compensation.
Other matters (s.392(2)(g))
No adjustment to the amount of compensation is made for contingencies because of the known period since dismissal and the likelihood that little will change in the circumstances of Mr Coorey between the date of hearing and decision.
Misconduct (s.392(3))
There is no evidence that misconduct was a contributing factor to the dismissal. No reduction in the amount of compensation is appropriate under section 392 of the Act.
Shock, Distress (s.392(4))
The amount of compensation does not include a component for shock, humiliation or distress.
Compensation cap (s.392(5)&(6))
The amount of $5,949.98 gross is less than the compensation cap of 26 weeks’ pay. No further adjustment of the amount is necessary.
Instalments (s.393)
While ATW did not apply to pay any order for the payment of compensation by instalments, I consider it appropriate that such an order be made. This is due to the evident financial pressures on Mr Burton and the very small size of ATW’s business. The compensation amount will be payable in three separate weekly instalments.
Conclusion on remedy
The compensation amount of $5,949.98 gross is neither excessive nor inadequate in the circumstances of the case. For the reasons above, I am satisfied that a remedy of compensation in this amount is appropriate in all of the circumstances. An order [PR761221] will issue separately giving effect to this decision.
COMMISSIONER
Appearances:
C Coorey on his own behalf.
N Burton for the respondent.
Hearing details:
2023.
Sydney (by video):
April 12.
<PR761220>
[1] Fair Work Act 2009 (Cth), s.389(1)(b).
[2] [2013] FWCFB 431.
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