Con Mourmourakis v Blade Runner Barber Pty Ltd

[2019] FWC 4904

[2019] FWC 4904

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Con Mourmourakis
v
Blade Runner Barber Pty Ltd
(U2019/2963)

DEPUTY PRESIDENT BOYCE SYDNEY, 6 SEPTEMBER 2019

Application for an unfair dismissal remedy —whether dismissal was harsh, unjust or unreasonable — where person was unable to work due to temporary illness — where reason for termination is unlawful – unfair dismissal – compensation awarded

Introduction

[1] On 15 March 2019, Mr Con Mourmourakis (Applicant) lodged an application for an unfair dismissal remedy (in the form of compensation) with the Fair Work Commission (Commission) by filing a Form F2 through the Commission’s website. The Applicant claims he was unfairly dismissed by his former employer, Blade Runner Barber Pty Ltd (Respondent), on 3 March 2019.

[2] On 26 March 2019, the Respondent emailed a scanned copy of a Form F3 to the Commission, in which the Respondent denied that the Applicant had been unfairly dismissed.

[3] On 16 April 2019, the Commission held conciliation in order to provide the parties an opportunity to settle their dismissal dispute by agreement. The parties were unable to settle.

[4] On 12 July 2019, I held an arbitration hearing in Wollongong. In attendance was the Applicant, who appeared for himself. Mr Muqdam Alkuzaie, Director, appeared for the Respondent.

[5] There are no jurisdictional issues concerning the Applicant’s statutory right to be protected from unfair dismissal. Nor is there any issue that the Applicant was “dismissed” within the meaning of s.386 of the Fair Work Act 2009 (Act).

[6] Having considered the submissions of the parties, and evidence provided prior to and during the hearing, I have determined that the Applicant’s dismissal was unfair within the meaning of s.385 of the Act.

[7] Noting the considerations required under Division 4 of Part 3-2 of the Act, I have further determined that the Respondent is to pay the Applicant compensation in the gross amount of $3,224.46.

[8] I set out the reasons for my decision following.

Factual background

[9] On 25 September 2017, the Applicant began working for the Respondent as an apprentice barber.

[10] The Applicant worked an average of 54 hours per week (including overtime) and was paid approximately $924.82 per week by electronic funds transfer to his nominated bank account. The Applicant claimed (and the Respondent did not deny) receiving an additional $150.00 in cash per week, in addition to the money that was made to the Applicant by way of electronic funds transfer. The Applicant’s total average income was therefore $1074.82 per week.

[11] The relationship between the Applicant and Mr Alkuzaie began as a productive and trusting one, there being some limited family history between the two prior the Applicant beginning his employment. However, that relationship became acrimonious over time. On at least one occasion, Mr Alkuzaie commented on the Applicant’s performance and reprimanded him regarding both his conduct and the quality of his work. On at least one occasion, Mr Alkuzaie scolded the Applicant in the presence of either customers or other staff members, or both.

Personal leave taken on 26 February 2019

[12] On 25 January 2019, the following text messages were exchanged between the Applicant and Respondent:

“Applicant: Hey Mick went to the doctor she said what I have is called gastro, still not feeling good won’t be able to come in tomorrow

Mr Alkuzaie: Not good at all mate

U realy start hurting my business u have to stop this … b4 its to late

Applicant: Mick. I never call in sick I’m the only one who comes 20 minutes before work To make sure everything is ready

Mr Alkuzaie: U r off Monday

Applicant: Mick that’s not fair to take one of my days off because I’m sick.

Mr Alkuzaie: Don’t start mate … is it fair to fake sickness? U keep doing it over n over u acting sick Thursday to have today n tomorrow!!!! We expected that

Sorry, I can’t talk right now.

Applicant: No mick you think I’m just faking sick. That’s so unfair I have not taken one day off sick since July…

Mr Alkuzaie: What Fukn money

Applicant: Your not letting me work my usual day because I’m sick. That is taking money out of my pocket.

I’m sorry I’m sick mick. Whether to believe it or not I actually am. That’s why employeeshave 10 sick days a year…

Mr Alkuzaie: I lost hundreds

Applicant: Mick I’m entitled to sick days and I’m honest to god sick. I’m sorry for any inconvenience.

Mr Alkuzaie: U r entitled to do 38 hours on $13 plus u r not sick… do not sms back. This is your last warning otherwise u follow Munzer I have nothing to say”.

[13] Even though the Applicant did not work on the public holiday Monday, being 28 January 2019, he was still paid for the day at ordinary time.

Personal leave taken on 1 March 2019

[14] On 28 February 2019, the following text messages were exchanged between the Applicant and Respondent:

“Mr Alkuzaie: Ur off tomorrow

Applicant: Thank you I’m not feeling the best

Mr Alkuzaie: From now on u alway off Friday

Applicant: You can’t cut my hours because I’m sick

Mr Alkuzaie: If you still want ur job u got to take what’s available for u. ….ur credit now 0%

Applicant: Call me.

It’s always been available for me

And now because I’m sick you want to cut my hours.

I’m not trying to create an argument but for you to cut my hours because I’m genuinely sick is not fair

Mr Alkuzaie: U becoming bad for the shop”.

Termination of employment

[15] On 3 March 2019, Mr Alkuzaie emailed the Applicant the following:

“Dear Con, Due to changes in the business conditions, I would like to advise you that I am unable to offer a job beyond 16/3/2019. Meanwhile you may keep working for the next two weeks’ notice. On the other hand, please return the shop keys as soon as possible …”

[16] The Applicant did not attend the workplace during his notice period. Despite his non-attendance, the Applicant’s final payslip indicates he was paid up until 7 March 2019. The Applicant was paid his accrued leave upon termination.

[17] Following the dismissal, another person was immediately employed into the Applicant’s role and carried out his duties.

Consideration

[18] There being no jurisdictional issues formally raised by the Respondent, the question I need to answer is whether the dismissal was harsh, unjust or unreasonable. 1 Section 387 of the Fair Work Act 2009 (Cth) (Act) provides what matters must be taken into account in determining whether a dismissal was harsh, unjust or unreasonable:

“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.”

[19] I will consider these matters in turn.

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

[20] If there is no valid reason for a dismissal then, prima facie, the dismissal qualifies as “unfair” within the meaning of the Act. A valid reason is said to be one that is “sound, defensible or well founded” but a reason which is “capricious, fanciful, spiteful or prejudiced” cannot be a valid reason”. 2

[21] In Miller v University of New South Wales, 3 and although his Honour was addressing a predecessor provision to that found in the Act, Gray J considered the matters that need to be considered when determining if there was a valid reason for the dismissal:

“The provision refers to a “valid reason” in another sense altogether. The reason must be related to the capacity or conduct of the employee, or to the employer’s operational requirements. What is sought is not the existence of a legal entitlement to terminate the employment, but the existence of a reason for the exercise of that right that is related to the factual situation. The validity is not to be judged by reference to legal entitlements, but to the Commission’s assessment of the factual circumstances as to what the employee is capable of doing or has done, or as to what the employer requires in order to continue its activities”. (my emphasis)

[22] The Respondent has submitted there were three reasons for the Applicant’s termination:

a) the Applicant’s role was no longer required;

b) the Applicant underperformed insofar as the quality of this work was below that expected and required of him; and

c) the Applicant was often unavailable to work at short notice because of alleged temporary illness.

[23] For the reasons that follow, I find that none of these reasons can be said to be “sound, defensible or well founded”.

[24] As to the purported reason that the Applicant’s job was no longer being required to be performed, the fact that a person was employed to do the same substantive job as the Applicant (immediately after the Applicant’s termination) shows that role was never made not required (or made redundant) in any genuine sense. The Respondent’s submission cannot be considered valid because it not a reason that accords with the facts.

[25] As to the alleged underperformance of the Applicant, little evidence was provided to support this claim. Whilst it was agreed that at on at least one occasion Mr Alkuzaie addressed issues with the Applicant’s underperformance, it was addressed only generally. Due to the lack of probative evidence on this point, I do not accept that there were issues with the performance or conduct of the Applicant such as to give rise to a valid reason for his termination. No witnesses were called (namely other staff who Mr Alkuzaie claims to have been present when such issues were raised with the Applicant) to support Mr Alkuzaie’s claims regarding underperformance. Mr Alkuzaie could not particularise the conduct issues when pressed by me on the point. On balance, I do not accept there to be any conduct issues that give rise to a valid reason in this matter. That is not to conclude that there were no conduct and/or underperformance issues in relation to the Applicant at all (i.e. such matters just do not ground a valid reason for dismissal).

[26] As to the Applicant’s repeated temporary absences due to alleged illness, the text messages make clear that the Respondent was dissatisfied that the Applicant was regularly taking time off work. Given the temporal connection between Mr Alkuzaie raising the issue with the Applicant, and the eventual termination, and Mr Alkuzaie submission at the hearing that he “cannot run a business” when staff take short, repeated periods of leave, I accept that this was (at least) one reason for the dismissal (despite it not being expressly stated to the Applicant).

[27] The Act prohibits a dismissal if the reason for that dismissal is because of a temporary illness or injury. 4 It is an unlawful reason for termination. An unlawful reason cannot be said to be “sound, defensible or well founded”. It cannot be said to be a valid reason.

[28] There being no redundancy, or underperformance warranting termination, and a reason being one that is unlawful, I find that there was no valid reason for the Applicant’s dismissal by the Respondent.

Was the Applicant notified of those reasons?

[29] The only reason given to the Applicant was that the Respondent was not able to offer the Applicant ongoing employment. That reasoning was sent by email and with little-to-no elaboration beyond what was stated.

[30] I find the notification to be entirely unsatisfactory and, as such, weighs in favour of finding that the termination was “unjust”.

Was the Applicant given an opportunity to respond to any reason related to the capacity or conduct of the Applicant?

[31] The Applicant was neither given an opportunity to respond to the stated reason for the dismissal, nor was he consulted about his purported redundancy. This is a matter that weighs in favour of a finding that the dismissal was “unjust”.

[32] I note that the Applicant was given an opportunity to defend himself against the Respondent’s concern about his taking of excessive leave. The Applicant stated to Mr Alkuzaie that the Respondent could not reduce his hours or terminate his employment for this reason. It appears the Applicant’s protestations fell on deaf ears. The Respondent had already resolved to terminate the Applicant regardless of the Applicant’s response. This circumstance weighs in favour findings that the dismissal was both “unjust” and “harsh”.

Was there any unreasonable refusal by the Respondent to allow the Applicant to have a support person present to assist at any discussions relating to dismissal?

[33] There being no request by the Applicant to have a support person present during the discussions leading up to his dismissal, which were conducted by text message and email, I consider this is a natural criterion in this matter.

Was the applicant warned about that unsatisfactory performance before the dismissal?

[34] As stated above, it is accepted that Mr Alkuzaie spoke to the Applicant regarding his performance. However, it is not accepted that the Applicant was made aware of any proper particulars of his alleged unsatisfactory performance. The Applicant was not afforded any real opportunity to consider where or how his performance was lacking. He could not seek to improve if he did not know what the issues were. The absence of any cogent warning regarding performance weighs in favour of a finding that the dismissal was “harsh”.

The degree to which the size of the employer’s enterprise would be likely to impact the procedures followed in effecting the dismissal? The degree to which the absence of a dedicated human resource management specialist or expertise in the enterprise was likely to impact on the procedures followed in effecting the dismissal?

[35] It is appropriate to address these criteria together as the Respondent is a small business.

[36] There was no evidence that the Respondent considered the procedural steps provided for by the Small Business Fair Dismissal Code. This is unsurprising, however, as the Respondent is a small operation and has no specialist person/s dealing with employment related matters.

[37] I appreciate the Respondent’s position. There was a deteriorating relationship between the Applicant and Mr Alkuzaie. Mr Alkuzaie was trying to run a profitable business and was struggling to communicate his concerns with the Applicant. His submissions demonstrate an inexperience as to what is required of an employer when dealing with the termination of an employee.

[38] The circumstances show that the small size of the business, and absence of expertise, has had an impact on the procedures that were followed. However, the Respondent’s process was so deficient that it cannot be excused or overlooked. There was nothing afforded to the Applicant in the way of procedural fairness. 5 The decision to terminate the Applicant was sudden. The methods employed by the Respondent, albeit understandable, do not weigh in its favour.

Other relevant matters

[39] There were no other matters the parties identified as relevant. Further, I can identify no matters I believe to relevant.

Was the dismissal of the Applicant harsh, unjust or unreasonable?

[40] Having made findings in relation to the relevant matters specified in s.387 of the Act, and having given due weight to each as a fundamental element in determining whether the Applicant’s dismissal was harsh, unjust or unreasonable, 6 I am satisfied that the dismissal of the Applicant was harsh and unjust.

Remedy

[41] The Applicant does not seek reinstatement, nor do I consider it appropriate given the total breakdown in the employment relationship. The issue thus turns to whether compensation should be awarded and, if so, its quantum.

[42] Section 392(2) of the Act requires all of the circumstances of the case to be taken into account when determining an amount to be paid as compensation to the Applicant in lieu of reinstatement:

“392 Remedy—compensation

…

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.

Effect of an order on the viability of the Respondent’s enterprise

[43] The Respondent made no submission and provided no evidence as to the effect of an order for compensation on the viability of the Respondent’s business. This is thus a neutral consideration in this matter.

Length of the Applicant’s service

[44] The Applicant was employed by the Respondent from 25 September 2017 to 16 March 2019, a period of less than 18 months. This is not a significant period of employment.

Remuneration that the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed

[45] As stated by a majority of the Full Court of the Federal Court in He v Lewin: 7

“In determining the remuneration that the Applicant would have received, or would have been likely to receive… the Commission must address itself to the question whether, if the actual termination had not occurred, the employment would have been likely to continue, or would have been terminated at some time by another means. It is necessary for the Commission to make a finding of fact as to the likelihood of a further termination, in order to be able to assess the amount of remuneration the employee would have received, or would have been likely to receive, if there had not been the actual termination”. 8

[46] As already stated above, the employment relationship between the parties was highly tenuous prior to the dismissal. On this basis, it is unlikely that the Applicant’s employment with the Respondent would have continued for any significant length of time (i.e. but for his termination effective 16 March 2019). I do not consider that the Applicant’s employment would have continued longer than 4 weeks if he had not been dismissed on 3 March 2019.

Efforts of the Applicant to mitigate the loss suffered by the Applicant because of the dismissal

[47] The Applicant must provide evidence that he has taken reasonable steps to minimise the impact of the dismissal. 9 What is reasonable depends on the circumstances of the case.10 The Applicant provided no evidence of his efforts to find further employment or otherwise mitigate his loss flowing from the termination. I therefore discount by 25 percent any ultimate compensation I determine to award to the Applicant.

Amount of remuneration earned by the Applicant from employment or other work during the period between the dismissal and the making of the order for compensation

[48] The Applicant provided no evidence on this issue. It is therefore a neutral consideration in this matter.

Amount of income reasonably likely to be so earned by the Applicant during the period between the making of the order for compensation and the actual compensation

[49] The parties made no submissions on this issue. It is therefore a neutral consideration in this matter.

Shock, distress etc. disregarded

[50] I confirm that any amount ordered does not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt caused to the Applicant by the manner of the dismissal.

Calculation of compensation

[51] As noted by the Full Bench in Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries: 11

“[t]he well-established approach to the assessment of compensation under s.392 of the [Act] … is to apply the “Sprigg formula” derived from the Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul’s Licensed Festival Supermarket (Sprigg). This approach was articulated in the context of the FW Act in Bowden v Ottrey Homes Cobram and District Retirement Villages.” 12

[52] The approach in Sprigg is as follows:

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

b) Step 2: Deduct monies earned since termination;

c) Step 3: Discount the remaining amount for contingencies; and

d) 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.

Step 1

[53] As stated at paragraph [46] above, this period is 4 weeks, being the “anticipated period of employment”. 13

Step 2

[54] There is no evidence of any monies earned by the Applicant since his dismissal by the Respondent.

Step 3

[55] I am not aware of any contingencies to be applied.

Step 4

[56] I have considered the impact of taxation but have elected to settle on a gross amount.

[57] Having applied the formula in Sprigg, I am nevertheless required to ensure that “the level of compensation is an amount that is considered appropriate having regard to all the circumstances of the case” (as set out in this decision in respect of my s.392(2) considerations). 14 Given my findings that there was no valid reason for dismissal, I am not persuaded to make any reduction on the compensation amount payable to the Applicant.

Compensation – is the amount to be reduced on account of misconduct?

[58] If I am satisfied that any misconduct of the Applicant contributed to the employer’s decision to dismiss, I am obliged by s.392(3) of the Act to reduce the amount I would otherwise order by an appropriate amount on account of the misconduct. Given my findings as to no evident misconduct by the Applicant, I make no reduction in this regard.

Conclusion on compensation and orders

[59] I have determined that the Respondent is to pay the Applicant (within 14 days of the date of this decision) a gross amount of $3,224.46 (less applicable taxation as required by law), being $1,074.82 x 4 weeks, less 25 percent discount (for failure to mitigate loss) = $3,224.46 (gross).

[60] An Order [PR712113] to this effect will be issued with this decision.

DEPUTY PRESIDENT

Appearances:

The Applicant appeared for himself.

Mr Muqdam Alkuzaie appeared for the Respondent.

Hearing details:

12 July 2019 in Wollongong, New South Wales

Printed by authority of the Commonwealth Government Printer

<PR710324>

 1   Fair Work Act 2009 (Cth) s.385.

 2   See: Selvachandran v Peteron Plastics Pty Ltd [1995] IRCA 333; (2000) IR 371 at 373.

 3 [2003] FCAFC 180 at [13].

 4   Fair Work Act 2009 (Cth) s.352.

 5   See: Williams v The Chuang Family Trust t/a Top Hair Design[2012] FWA 9517 at [40].

 6   ALH Group Pty Ltd t/a The Royal Exchange Hotel v Mulhall (2002) 117 IR 357 at [51]. See also Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002)at [92]; Edwards v Justice Giudice [1999] FCA 1836 at[6]–[7].

 7 [2004] FCAFC 161.

 8 Ibid at [58].

 9   Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002) at [34], citing Lockwood Security Products Pty Ltd v Sulocki and Ors PR908053 (AIRCFB, Giudice J, Lacy SDP, Blair C, 23 August 2001) at [45].

 10   Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002) at [34], citing Payzu Ltd v Saunders [1919] 2 KB 581.

 11   [2016] FWCFB 7206 at [16].

 12   Ibid at at [16], citing Sprigg v Paul’s Licensed Festival Supermarket (1988) 88 IR 21 and Bowden v Ottrey Homes Cobram and District Retirement Villages[2013] FWCFB 431.

 13   Ellawala v Australian Postal Corporation Print S5109 (AIRCFB, Ross VP, Williams SDP, Gay C, 17 April 2000), at [34].

 14   Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries[2016] FWCFB 7206 at [17].