Constantinos (Costa) Telidis v Susorra Pty Ltd t/as Garmex

[2013] FWC 1016

[2013] FWC 1016

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s 394 - Application for unfair dismissal remedy

Constantinos (Costa) Telidis
v
Susorra Pty Ltd t/as Garmex
(U2012/14441)

DEPUTY PRESIDENT SAMS SYDNEY, 21 FEBRUARY 2013

Application for unfair dismissal remedy - whether dismissal ‘harsh, unjust or unreasonable’ - performance issues - failure to meet sales targets - failure to follow lawful and reasonable directions - misconduct - valid reason for dismissal - written warnings disputed - failure to give applicant opportunity to respond - applicant denied procedural fairness - dismissal unfair - directions for further submissions as to remedy.

BACKGROUND

[1] For six and a half years, Mr Costa Telidis (the ‘applicant’) was employed as a Sales Representative by Susorra Pty Ltd t/as Garmex (the ‘respondent’), until he was dismissed by one of the respondent’s Directors, Mr Michael Skettos, on 15 October 2012. Although there was no letter of termination, the reasons for the applicant’s dismissal were said to be a failure to meet the respondent’s sales targets and his ongoing refusal to comply with the instructions of his immediate supervisor. Mr Skettos tendered copies of two warning letters allegedly given to the applicant on 30 April 2012 and 15 July 2012 (subsequently amended to 16 July 2012), highlighting these matters.

[2] Not only did the applicant dispute the contents of the warning letters, but he vigorously denied ever receiving or sighting the warnings. Indeed, he claimed that Mr Skettos had forged his signature on both letters. It is fair to say that the applicant demonstrated an absolute disdain for Mr Skettos; variously accusing him of lying, dishonesty, bullying, intimidation and harassment. It seems that these claims were based on a history of a poor relationship with Mr Skettos and exacerbated by Mr Skettos’ later refusal to pay the applicant all his outstanding entitlements, including unpaid commissions, immediately after he was dismissed. However, it was apparent that Mr Skettos was not the only person in the workplace with whom the applicant - putting it mildly - had issues. I shall come to these matters shortly.

[3] The applicant’s dismissal on 15 October 2012 followed a meeting between him, Mr Skettos and Ms Lindi Glick, Customer Service Manager. Each side charged the other with angry outbursts and hostility during the meeting. The acrimony was exacerbated by claims as to the ownership of a work diary and mobile phone in the keeping of Mr Telidis and a call to the Police by Mr Skettos.

[4] Unfortunately, this unhealthy depth of feeling and emotion was on further display during the proceedings, when the applicant again called Mr Skettos a liar on many occasions. To his credit, Mr Skettos did not respond in kind, although he became slightly agitated when he described how the applicant had said on 15 October 2012 that he hoped Ms Glick was ‘a good root’ and accused them of having an affair. The applicant acknowledged these comments had been said in Ms Glick’s presence.

[5] On 22 October 2012, the applicant filed an application for a remedy from unfair dismissal, under s 394 of the Fair Work Act 2009 (the ‘Act’). The applicant does not seek reinstatement and in light of his open hostility towards Mr Skettos, that is hardly surprising. Unsuccessful attempts were made to conciliate the matter, first by a Fair Work Conciliator and again by me on the day of the hearing.

[6] Both parties were unrepresented. Regrettably, their preparation for the hearing and the documents filed plainly reflected their lack of knowledge and understanding of what was required for an orderly and objective hearing of the matter. Nevertheless, I am satisfied that both parties were given every opportunity to put whatever they wished in support of their respective positions; See: Davidson v Aboriginal and Islander Care Agency, (Unreported, AIRC, 12 May 1998) Dec 534/98 N Print Q0784.

[7] The applicant and Mr Skettos both provided documents headed ‘Outline of Submissions’, which I accepted as their statements. No other witness statements were filed. The applicant tendered numerous unsanitised pages of his diary and an assortment of email communications he had sent to and received from the respondent. The applicant’s numerous detailed diary notes are jumbled and not in any date sequence. Dates of pages have been cut off in photocopying. As a result, it was very difficult to ascertain a clear picture of events as seen through the eyes of the applicant. At this point, I observe that given the evidentiary conflict between Mr Skettos and the applicant, it was curious that Ms Glick was not called to give evidence, particularly given her direct involvement in the events of 15 October 2012.

THE EVIDENCE

The applicant’s case

[8] The applicant claimed that his duties, in addition to being a Sales Representative, included collecting overdue accounts, installation, pick up and deliveries and other service related functions. He referred to various emails and diary notes which, he said, demonstrated his service related role. The applicant said that he regularly acted as a Service Manager and that Mr Skettos had told him not to worry about his sales targets in June 2012. He claimed to have received only one sales report for 30 April 2012. The applicant further alleged that the respondent failed to pay him his entitlements on many occasions when he travelled very long distances and that he had been short changed or had his commission deducted with no warning or notice. When he complained about these matters, he was called a ‘whinger’ and told that he was lucky to have a job.

[9] The applicant described a breakdown in his working relationship with another female colleague (‘Raj’) in April 2011 who was also in a supervisory role. As a result of their clashes, it would seem from the materials provided by the applicant, that Raj was so upset, that she had to take sick leave. She had filed a complaint against the applicant and said she was scared to come to work because of him. He denied her complaint and levelled his own bullying and abuse claim against a ‘Mr Wilson’. He added, ‘nothing ever gets said or done to him despite my numerous verbal and written complaints over the last five years.’

[10] The applicant claimed that the respondent had no written complaints policy or procedure and none of his complaints were ever addressed by the Directors. Therefore, he believed that Mr Skettos and the other director, Mr Papasavvas, failed to provide a safe work environment, were negligent in their duties and allowed workplace bullying. From late 2010 there are examples of the applicant complaining about bullying and harassment. In one email dated 3 September 2010 to ‘Jenny’, he said:

‘Jenny this is an oficial [sic] warning that I will not tolerate your snapping & verbally offending me.

You have done it far too many times & I’m letting you know it’s not acceptable now nor will be tolerated any longer.

I warned you verbally today & now officially in writting [sic].’

[11] In another dated 25 November 2010 to a ‘Mick’, he said:

‘Good morning Michael,

This is an official warning that your abuse and screaming at me, as you did again to me this morning. Will not be tolerated or excepted [sic] ever again.

Next time you behave so rudely and offensive towards me and especially in front of all the laundry staff. I will walk away and refuse to work with you.

You have threatened me, abused me and spoken rudely to me for the last time.

If you have an issue, take it out with the directors. I’m not your wife or your dog so don’t ever speak to me like that again.’

[12] The applicant referred to a complaint about Ms Glick from another employee who was dismissed in which the employee alleged abuse and foul language by Ms Glick. The applicant detailed various claims from around December 2010, of harassment and lying by colleagues, but principally Ms Glick and his immediate Manager, ‘Mark’. Mr Papasavvas replied on 15 December 2010 as follows:

‘As you know, you are a valued employee, stop questioning that. I have met your demands on any occasions for you to know that.

However it does not mean you can work independently.

I cant be your direct manager, Michael doesn’t want me to be and neither do I have the time to allocate.

You have to show respect to Mark. You cant run to me everytime you say he talks “disrespectful” to you

As you know there are two sides to every coin. The other side to this is that you are not giving Mark any respect for his position.

If he needed to speak to you immediately. Then he needed to speak to you immediately.

You disrespected him by demonstrating that what you were doing was important that [sic] what he was doing.

I cannot keep interfering because i will be adding to the problem and will result in having two managers. Which defeats the purpose.

Reality is that Mark is currently your immediate manager.’

[13] The applicant believed that Mr Skettos and Mr Papasavvas encouraged and allowed a culture of lying, bullying and harassment. Mr Skettos would abuse him, yell at and belittle him in front of the person he had complained about. This had the effect of emboldening his tormentor. The applicant claimed he was very good at his job generally and especially in sales. He did not want to ‘ruffle feathers’ for fear of losing his job.

[14] The applicant provided a chronology of events leading up to his dismissal. He said that when the respondent changed its name to Susorra Pty Ltd in 2012, he refused to sign any paperwork, unless he was assured of preserving all his entitlements. He complained about his commission and travel expenses and rejected Mr Skettos’ offer of a second hand car (and sought a Porsche in response). He accused Mr Skettos of abuse and lies. He also accused Mr Skettos of being volatile, abusive and threatening in 2011 and 2012. He cited an email to Ryde\Parramatta Golf Club that had been revised and corrected by Mr Skettos, as evidence of bullying and intimidation and of Mr Skettos forcing him to write lies.

[15] The applicant claimed to have overheard a conversation between Ms Glick and Mr Papasavvas in which they were conspiring to make untrue accusations about another employee. In various diary notes he would comment on the Directors changing sales targets to his detriment. He later complained that Ms Glick had been given sale leads that were his.

[16] The applicant said he was dismissed over the phone by Mr Skettos on 2 October 2012. He described him as ‘demon possessed’ and a ‘psychotic fool’. Mr Papasavvas acknowledged that he had been sacked, but he had told him to return to work and sort it out.

[17] The applicant further alleged that Mr Skettos had lied about his sales target in 2012 of $200 as he was doing deliveries and service work in 2011-2012. Mr Skettos had lied about the purchase of a sales book, which the applicant had bought himself. He lied about the applicant being sacked after a complaint by a female employee (Raj) in 2011. The applicant further claimed that Mr Skettos had promised to pay him all his entitlements, but he had also lied about having done so.

The respondent’s case

[18] Mr Skettos claimed that the applicant’s sales target in 2012 had been $200, having been lowered from $300 in 2011. The applicant was advised of, and agreed to this new target in January 2012. He was assured that all new sales leads would be given to him.

[19] Mr Skettos said that the applicant received two warning letters on 30 April and 16 July 2012, indicating he was not meeting sales targets and was interfering in other employees’ work. Mr Skettos explained that, initially, Ms Glick and Mr Richard Doswell were responsible for all service issues with customers and the applicant was directed to refer all sales issues to them. In February 2012, Mr Skettos was told he was not doing so. The applicant complained to him about the way service was carried out. Mr Skettos said he told him to pass all service issues on and concentrate on sales. The problem continued in March and was causing acrimony between the applicant and Ms Glick and Mr Doswell. However, he continued to inject himself into issues where he was not wanted and his sales had suffered accordingly.

[20] Mr Skettos claimed that the applicant was offered assistance to help him close sales, but he refused the offer. He was given a sales book to enhance his sales techniques and there were weekly meetings to monitor his sales progress. These meetings were informal and irregular. In September 2012, Ms Glick was moved back to full time sales due to the poor sales performance. The applicant was unhappy about this move and responded that due to Ms Glick’s incompetence, there were still hundreds of service issues. Mr Skettos felt the applicant would not believe him that these issues were in hand. In the week before 15 October, in a usual sales meeting, the applicant refused to focus on his sales and complained about an eight month old national account which he claimed he should have been handling. Mr Skettos told him to concentrate on other prospects and find new business. The applicant insisted on pursuing this contract.

[21] Mr Skettos tabled the applicant’s sales report in the final meeting with him on 15 October 2012. It read as follows:

Costa’s account Nov ’11 - Oct ‘12

Signed Contract	Commenced	Weekly Amt
05/07/2012	02/11/2011	$ 118.51	Max Hire (Rutherford)
13/10/2011	30/11/2011	$ 156.29	Max Hire (Seven Hills)
12/10/2011	04/01/2012	$ 200.00	East Maitland Golf Club
21/10/2011	31/01/2012	$ 86.94	Grange Meats
21/10/2011	31/01/2012	$ 74.52	Country Fresh Meats
04/11/2011	01/02/2012	$ 51.75	Akamas Engineering
01/12/2011	16/02/2012	$ 214.76	Sweet William
19/01/2012	23/01/2012	$ 131.45	Santos Coffee
06/02/2012	07/03/2012	$ 154.22	Flavours Catering
19/03/2012	20/03/2012	$ 300.00	Dooleys Regents Park - Linen
22/05/2012	04/06/2012	$ 400.00	Urban Hotel - St Leonards
14/06/2012	30/06/2012	$ 32.09	Roche - Dee Why
04/07/2012	05/07/2012	$ -	Bob & Petes - 2 Inv’s only(Stopped using service)
11/07/2012	16/07/2012	$ 114.37	Charlie & Franks
12/07/2012	03/10/2012	$ 327.58	Q Station - Uniforms
31/08/2012	22/11/2012	$ 49.16	Dooleys Regent Park - Uniforms
31/08/2012	22/11/2012	$ 165.60	Dooleys Waterview - Silverwater - Uniforms
31/08/2012	22/11/2012	$ 460.58	Dooleys Lidcombe - Uniforms
11/09/2012	20/09/2012	$ 300.00	Billabong’s Rest (East Maitland Bowling Club
17/09/2012	29/01/2012	$ 221.49	Queens Club - Uniforms
21/09/2012	23/10/2012	$ 149.04	Kitchen by Mike - Uniforms
27/09/2012	15/10/2012	$ 550.00	Downer EDI
$ 4258.35

This works out to be $83.00 per week.

Please note these salse [sic] figures go back to 5th July 2011, with installation from November 2011

[22] When Mr Skettos told him, ‘we are not able to keep (you) in the position of sales representative’, the applicant ignored him and reiterated his claims in relation to the eight month old contract. He became abusive in his suggestions that he deserved the sale, and not Ms Glick. When Mr Skettos sought to focus on his sales, he said he wouldn’t discuss the matter until the national account issue was resolved. Mr Skettos then told the applicant that he was to ‘be let go’ immediately.

[23] With this, the applicant began to verbally abuse both him and Ms Glick. Mr Skettos asked him for his diary and mobile phone. He refused, left the building and ran down the street. The Police were called. They found him and brought him back. He agreed to hand back the mobile phone, but not the diary, claiming it was his personal property. He continued to make derogatory comments about him and Mr Glick. Mr Skettos asked him to make a copy of his diary and send it to him. The Police asked about the applicant’s entitlements and Mr Skettos said they hadn’t been calculated yet. The applicant continued his derogatory comments and the Police told him he wasn’t helping matters and that he should leave and seek legal advice.

The hearing

[24] Regrettably, the proceedings before the Commission on 8 February 2013, did not advance the matter much further than the unsatisactory written material. The applicant sought the maximum compensation for unfair dismissal under the Act, the payment of his commissions and travelling expenses, and called for Mr Skettos to withdraw his lies and admit to forging his signature and engaging in identity theft. Despite a further attempt to conciliate the matter, this proved unsuccessful.

[25] When the hearing resumed, I asked Mr Skettos if he wished to ask the applicant any questions. He said he didn’t know what to ask and believed he had covered everything he wanted to address in his statement. The applicant was provided an opportunity to cross examine Mr Skettos. However, this process was often reduced to the applicant making statements or challenging most of Mr Skettos’ evidence as ‘lies’.

[26] Mr Skettos deposed that the original signed warning letter of 30 April 2012 was in the applicant’s possession. The applicant exclaimed, ‘That is a lie’. Mr Skettos explained that the date of the second warning was a mistake and the meeting to which it referred was on 16 July, not the day before, being a Sunday. Mr Skettos was asked questions about the respondent’s change of business name which were irrelevant. Mr Skettos denied telling the applicant to get ‘the house in order’ by visiting golf clubs and other clubs and giving him a weekly report. Mr Skettos said he had not suggested that the applicant was given the sales book by a Mr Hurst, but that was what he had been told by Mr Papasavvas.

[27] Mr Skettos agreed he did not keep notes of directing the applicant to concentrate on sales, but that was his job and they had discussed it many times. Mr Skettos did know of, and had never ordered the applicant’s business cards; one of which the applicant produced and referred to him as the Business Development Manager.

[28] Mr Skettos reaffirmed his written statement concerning the abuse by the applicant in front of him and Ms Glick and his refusal to hand back his mobile phone on 15 October 2012. The applicant had accused him and Ms Glick of having an affair. Mr Skettos denied ever promising to give the applicant a bonus. In response, the applicant said, ‘I pity you, Mr Skettos, I honestly do.’

[29] In answer to questions from me, Mr Skettos said he kept no notes of the warning meetings and no one else had attended either of them.

SUBMISSIONS

[30] The applicant said he never had any written warnings. However, he acknowledged that Mr Skettos ‘did kick my arse many a time over certain things.’ He had been warned only once that his job was at risk over his interaction with Ms Glick. In contrast, he had made diary notes of when Mr Skettos told him he was a good employee. He lamented that now all he gets is abuse and lies. He believed he was dismissed close to Christmas because Mr Skettos knew his family circumstances and wanted to ‘teach me a lesson.’

[31] The applicant said that despite looking for a job, given the time of year and the industry’s circumstances, he had not been able to gain employment. He said that all he wanted was his just entitlements. He claimed that everything he had recorded in his diaries was true and he couldn’t have pre-planned such information, because he never expected to be in the Commission.

[32] The applicant put that Mr Skettos is a liar, had forged his signature and that the Commission should stop his ‘abuse of power and the system’. He added that he had nothing to hide and would not have wasted his time making false claims against Mr Skettos. The applicant said that Mr Skettos was a volatile man and that this was demonstrated when he sacked him over the phone two weeks prior to the events of 15 October 2012. Finally, the applicant said: ‘He was a bully. He was an intimidator, a harasser and a vile person to deal with. He lied to customers. He made me lie to customers. I was just over it.’

[33] For the respondent, Mr Skettos denied that he wanted or sought hardship for the applicant. He had not known of his family circumstances. The applicant was a Sales Representative and was well aware of his sales targets and of what was expected. He was dismissed for poor performance. Up to July 2012, he was the only sales person and it would not have made sense to dismiss him if he was meeting his sales targets.

[34] In reply, the applicant denied that he was the only sales person, as Ms Glick was getting all his phone leads and was supported by Mr Skettos. He went cold-calling and nothing was ever handed to him.

CONSIDERATION

Relevant statutory provisions

[35] Neither party specifically addressed the relevant statutory provisions applicable to an application under Chapter 3, Part 3-2, Division 3 of the Act. These are relevantly set out in s 387 of the Act as follows:

387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWA 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 FWA considers relevant.

[36] Before considering these provisions, I am satisfied that all of the other statutory prerequisites in respect to the Commission’s powers to determine this matter have been met, in that:

a) the applicant is a person protected from unfair dismissal; he has completed the minimum employment period and was covered by a Modern Award (ss 382(a) and (b))

b) the applicant was dismissed from his employment on 15 October 2012;

c) the Small Business Fair Dismissal Code is not applicable in that the respondent employed over 40 employees (s 385(c));

d) the dismissal was not a case of genuine redundancy (s 385(d)); and

e) the application was made within the 14 day statutory time period (s 394(2)).

[1] Accordingly, the remaining matter for the Commission to determine is whether the applicant’s dismissal was ‘harsh, unjust or unreasonable’ (s 385(b)) and this issue sends me back to the matters the Commission must take into account in s 387 above.

[2] To appreciate the meaning of the expression ‘harsh, unjust or unreasonable’, I refer the parties to the frequently quoted definition of the High Court in Byrne & Frew v Australian Airlines Ltd [1995] HCA 24, where McHugh and Gummow JJ said at para [128]:

‘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’.

[3] The first consideration is whether there was a valid reason for the applicant’s dismissal on 15 October 2012. The meaning of ‘valid reason’ arises from the judgment of North J in Selvachandran v Peterson Plastics Pty Ltd (1995) 62 IR 371 and has been consistently applied by members of the Commission and its predecessors in the unfair dismissal context. His Honour 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 reasons 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 treated fairly.’

Reasons for dismissal

[4] Doing the best I can from the informal and unsatisfactory state of the written material filed by both parties and the short oral evidence of Mr Skettos, there does not appear to be doubt that, firstly, the applicant’s sales targets were reduced in 2012 from $300 to $200 a week and, secondly, he was not meeting these targets. Of course, the applicant had explanations why he was not doing so. Nevertheless, on any view of it, for a person engaged as a Sales Representative, a sales target of $200 a week, even in a tight competitive market, does not appear to be particularly onerous.

[5] Providing numerous pages of details of site visits and follow ups to existing customers may well be indicative of a hard working and conscientious employee. However, most of these entries do not relate to new sales, which is really what the respondent wanted the applicant to concentrate on. The applicant conceded as much in his diary notes. I interpose to put this proposition: In cases such as this, where an employee’s sales performance is said to be less than the employer’s expectations, and the employee claims to be an honest, hardworking employee, achieving reasonable sales targets in a tough environment, an obvious question springs to mind. If the employee is as good as he makes out, why on earth would the employer want to get rid of him, particularly when he was the only sales person? It just doesn’t make any practical business sense in an environment where chasing and securing new sales is paramount.

[6] That said, taken on its own, a failure to meet sales targets, after having been warned of the consequences of not doing so (the latter of which is in dispute), may well constitute a valid reason for dismissal. But in this case, the applicant’s sales performance - good or otherwise - cannot be viewed in a vacuum. There were other relevant and more serious factors in play which do not reflect favourably on the applicant. I found aspects of the applicant’s conduct and behaviour most troubling. As I mentioned earlier, based on the applicant’s own diary notes and emails, he clearly took a hostile, disrespectful and belligerent attitude towards Ms Glick, his immediate supervisor and Mr Skettos.

[7] However, again from his own diary notes and submissions, Mr Skettos and Ms Glick were not the only ones he was having trouble working with. Nor were his complaints about others of only recent origin (see paras [9] - [13]). At least one employee, Raj, who was also the applicant’s immediate supervisor at the time, made a formal complaint about his behaviour in 2011 and said she was scared to come to work. While the applicant brushed this complaint off as being resolved, it seems to me that the applicant had very little good to say about any of his work colleagues, his managers or the Directors. Perhaps this says more about him, than it does about them. In any event, I do not see how the applicant’s diary - which is little more than a ‘hate file’ - served to advance his interests in this case.

[8] Below, I intend to quote some of the more colourful diary extracts. They are by no means the extent of his trail of venom against his work colleagues. It is to be observed that the applicant often invoked the name of God in the same breath as his accusatory profanities. I found this juxtaposition to be somewhat disconcerting.

26 October 2011:

‘She’s such a two faced, cunning malicious & untrustworthy pig. May God forgive me, but I don’t trust nor like her. I also saw Richard whispering to Lindi so I can’t hear. They both still play games & team up together. God willing Terry will see their true colours.’

12 December 2011:

‘I think she’s full of shit & lying.’

20 February 2012:

‘I rang Lindi to confirm she’s taking them to Factory. The bitch snapped she’s busy doing my job & hers.’

27 February 2012:

‘The line in the sand has been drawn. She continues to play silly games & yet Skettos does nothing.’

17 April 2012:

‘...deceitful snakes’ [Jenny, Lindi and Richard]

26 April 2012:

‘He [Richard] comes across as a calm cool and collected. But in reality he talks behind people’s back - isn’t what he makes out to be.’

30 April 2012:

‘What a cunt, bitch, slut, whore. God is my witness - I dislike her so much.’

30 April 2012:

‘I am now 100% convinced they [Richard and Lindy] are trouble and I do not trust them. In fact I spoke to my wife and family about it and they all warned me to be very cautious and on guard when I’m around them.’

1 May 2012:

‘Lindi the dog sent an email re North Beaches smash repairs. Lying & making outlandish claims. They’re going to get me in trouble.’

Email to Mr Skettos, 1 May 2012:

‘Lindys email below is nothing short of blatant lies.’

14 May 2012:

‘May God deal with Lindi & Skettos.’

20 May 2012:

‘I need to be more cautious with Dori and watch what I say for he is obviously two faced & mates with Richard.’

Email to self

12 July 2012:

‘Lindi is openly malicious, conniving,vindictive,etc’

13 July 2012:

‘May God deal with them as they deserve’ [Lindi and Richard]

7 August 2012:

‘Scumbag, low life, wich [sic] Lindy emailed me tipical [sic] foul attitude and blatant lies. When will Terry & Skettos see what I and others see. She’s bad & trouble.’

16 September 2012:

‘I’m sick of their ongoing lies & excuses.’

8 October 2012:

‘Michaels ongoing lies and missleading [sic] info is nothing unusual, but is very disappointing.’

[9] In addition, the applicant’s acknowledged comment during the heated events of 15 October 2012 in Ms Glick’s presence (see para [4]) would have been sufficient grounds, in my view, for finding that his earlier dismissal was justified. Moreover, his later accusations and offensive comments directed at Mr Skettos, strengthened the respondent’s case that his dismissal was the only possible outcome after a long period of insubordination and unacceptable conduct in the workplace. Whatever may have been the provocation (such as it was), there was simply no place for his relentless campaign of hostility towards Ms Glick, Mr Skettos and others. Nor was there any excuse for his behaviour on 15 October 2012 or subsequently.

[10] Even without the sales performance issue, I am satisfied that the applicant refused to accept the instructions of his direct supervisors, challenged their authority and interfered in the delineation of work responsibilities to the respondent’s detriment. It follows that I would conclude that there were valid reason/s for the applicant’s dismissal. The reasons were not ‘capricious, fanciful, spiteful or prejudiced’. Moreover, if dismissal had not occurred on 15 October 2012, I doubt his employment would have lasted very much longer.

Procedural fairness

[11] Subsections (b) - (e) of s 387 of the Act might be broadly characterised as issues going to whether a dismissed employee was afforded procedural fairness or, in other words, natural justice. It must be stressed that even if there was a valid reason for an employee’s dismissal, the dismissal may still be held to be unfair, if the employee was not afforded procedural fairness. This has been a long held industrial principle adopted and applied by this Commission, its predecessors and other industrial tribunals. At this juncture, I cite two authorities on the subject to make the point clear.

[12] In Crozier v Palazzo Corporation Pty Limited t/as Noble Storage and Transport (2000) 98 IR 137 (‘Crozier v Palazzo’), a Full Bench of the Australian Industrial Relations Commission (AIRC) said, in a matter not too dissimilar to this one, at para [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 170CG(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.’

[13] In Wadey v Y.M.C.A. Canberra 1996 IRCA 568, Moore J made clear that an employer cannot merely pay ‘lip service’ to giving an employee an opportunity to respond to allegations. His Honour said:

‘In my opinion the obligation imposed on an employer by that section has, for present purposes, two relevant aspects. The first is that the employee must be made aware of allegations concerning the employee's conduct so as to be able to respond to them. The second is that the employee must be given an opportunity to defend himself or herself. The second aspect, the opportunity to defend, implies an opportunity that might result in the employer deciding not to terminate the employment if the defence is of substance. An employer may simply go through the motions of giving the employee an opportunity to deal with allegations concerning conduct when, in substance, a firm decision to terminate had already been made which would be adhered to irrespective of anything the employee might say in his or her defence. That, in my opinion, does not constitute an opportunity to defend.’

[14] That said, however, any issue or issues of procedural unfairness may not be of such significance as to outweigh the substantive reason/s for an employee’s dismissal, particularly in cases of misconduct where the proven misconduct is of such gravity as to outweigh any other considerations such as age, length of service, contrition and issues of procedural unfairness.

[15] Given the state of the evidence, it is unclear to me whether the applicant was actually notified of the specific reasons for his dismissal. Indeed, he had no formal notice that the meeting was called to discuss his future employment. Certainly, there is no letter of dismissal and the dismissal occurred in a context of hostility on both sides during the heated and chaotic meeting on 15 October when Mr Skettos sought answers from him about his sales performance. The applicant left the meeting with the mobile phone and his diary and was seemingly chased down the street by Mr Skettos and Ms Glick with Mr Skettos demanding he hand over the phone and his diary (Given some of the grossly offensive entries in the diary, it is little wonder that he was reluctant to hand it over!).

[16] Whatever might be said about each person’s version of the meeting and its aftermath, it is abundantly clear that there was fault on both sides. Far from being notified of the reasons for his dismissal, the reasons only became apparent during the course of the meeting, by the tabling of his sales performance (see para [21]). It follows that I do not consider the applicant was given a fair or sufficient opportunity to respond to clear and straightforward allegations of poor performance and unacceptable conduct.

[17] In hindsight, Mr Skettos should have outlined the specific purpose of the meeting and given notice that it might result in the applicant’s dismissal. Further, the applicant should have been afforded a reasonable opportunity to prepare his defence and respond. From my understanding, the meeting became a slanging match that reflected poorly on both parties.

[18] There is no evidence that the respondent refused to have a witness or support person the applicant nominated to be present at the meeting. Perhaps if the applicant understood the seriousness of the meeting, he would have requested a support person. However, this is only conjecture. As I said earlier, it is curious that Ms Glick was at the meeting, but provided no evidence in the case. On the other hand, the applicant brought no corroborative witness evidence to support his claim that ‘Mr Skettos and Mr Papasavvas encouraged and allowed a workplace culture of lying, bullying and harassment to continue and thrive unabated.’

Warning letters

[19] The two warnings were expressed in the following terms:

’30 April,2012

Dear Costa,

As discussed on 30th April,2012,your sales are not meeting the sales targets agreed to in January of 2012,being $200 per week.

It is felt that you are involving yourself far too much in service issues which can be passed on too Lindi or Richard and it is felt hat your are not [sic] spending enough time quoting potential customers.

Please ensure that you pass on all service issues immediately to Richard or Lindi so that you may concentrate on sales.It is vitally important that you and the company company achieve it sales targets.This is all the more important considering the loss of our existing customer base in the last 12 months.

This letter is to serve as a first warning to you that you are not meeting your sales target and that you must concentrate on sales to lift the prospect of achieving them.’

’15 July 2012

Dear Costa,

As discussed on 15 July,2012 [subsequently amended to 16 July 2012], your sales are not meeting the sales targets agreed to in January of 2012,being $200 per week.

You are continuing to involve yourself in service issues all prinarily [sic] related to customers that you brought on years ago.Please let go of these customers and do not involve yourself in service issues.

Your primary role is to sell,please allow Richard or Lindi to look after service and if the customer is not satisfied with their service then it is a company issue which we ask you not to involve yourself in.

This letter is to serve as a second warning letter to you that you are not meeting your sales target and that you must concentrate on sales to lift the prospect of achieving them.’

[20] There was much controversy and conflicting evidence in relation to whether the applicant had been aware of, let alone signed, the two warning letters of 30 April and 16 July 2012. He strenuously denied ever seeing, being aware of or signing the warnings. Before considering these warnings, two general observations about warnings are apposite in a case such as this:

a) there must be a sufficient degree of specificity about the employee’s performance or conduct which is of concern to the employer; and

b) it must be made clear that a failure to improve performance or change conduct might place the employee’s job at risk.

[21] These notions were expressed by a Full Bench of the AIRC in Fastidia Pty Ltd v Goodwin (2000) 102 IR 131 at paras [42]-[44]:

‘[42] As we have indicated, we accept that Mr Hazelhoff gave Mr Goodwin the "official" and "unofficial warnings" referred to in his testimony. Were they warnings of the type contemplated by s.170CG(3)(d)?

[43] In the context of s.170CG(3)(d) we think that a warning must:

- identify the relevant aspect of the employee's performance which is of concern to the employer; and

- make it clear that the employee's employment is at risk unless the performance issue identified is addressed.

[44] In relation to the latter requirement, a mere exhortation for the employee to improve his or her performance would not be sufficient. We also note that we accept that these criterion are to be applied in a practical and commonsense way taking into account the employment context.’

[22] In Crozier v Palazzo, the Full Bench said at paras [78]-[79]:

‘[78] Some months after he started work Mr Crozier met with Messrs Black and Palazzo. There is a dispute about when the meeting took place. Mr Crozier says October 1998 and Messrs Black and Palazzo say 20 November 1998. It is unnecessary for us to resolve this conflict. It is not contested that at that meeting Mr Crozier was asked to provide an overview of his performance and he produced a list of the businesses he had contacted. During the course of the meeting Mr Palazzo said that he was unhappy with Mr Crozier's performance. Mr Crozier had agreed with the proposition that his results were not good but he said that he was confident that he would be able to get more business in the future.

[79] While Mr Crozier would have been aware that his employer was unhappy with his performance that fact does not amount to a warning within the meaning of s.170CG(3)(d). We find that the statements made to Mr Crozier during the course of his employment lack the particularity required of the type of warning contemplated by s.170CG(3)(d).’

[23] On one view, there are a number of reasons to doubt the veracity of the written warnings given to the applicant. These include:

a) as mentioned earlier, the applicant vehemently denies signing the warnings, let alone receiving them. He claimed Mr Skettos forged his signature;

b) Mr Skettos produced no contemporaneous notes or diary entries of these meetings;

c) There were no other witnesses in the meetings; and

d) One warning was dated on a Sunday when the applicant wasn’t even at work (although I note that Mr Skettos explained that the date was a clerical error).

[24] On the other hand:

a) the signature of the applicant is not dissimilar to his actual signature - in other words, it is difficult to tell if it is a fake; and

b) it is a ‘big call’ to make, that the respondent would deliberately forge the applicant’s signature for some collateral purpose; and

c) if, as seems to be the case, there were genuine issues with sales performance and interaction with other staff, why would it be necessary to concoct disciplinary meetings, rather than just have them? This is particularly relevant, given that the first warning was alleged to have been given on 30 April, the second on 16 July and that the dismissal occurred on 15 October. If Mr Skettos had set out to fabricate a scenario to justify a dismissal, it seems curious that he waited six months to do so; and

d) there is no doubt there was some kind of meeting on 30 April 2012, as the applicant’s own diary entry makes clear.

[25] Regrettably, I am unable to make specific findings as to whether the applicant had received the two written warnings. In some respects it is not crucial to the ultimate conclusion I draw as to whether the applicant’s dismissal was procedurally unfair. Nevertheless, it is plain, as his own diary attests, that the applicant was well aware his sales performance was under review and his behaviour towards other staff was an issue (See diary entries of 17 September 2012 and 14 May 2012). He did not seem to understand the seriousness of the path he was heading down; but that does not exculpate the employer’s responsibilities.

[26] As to the other matters under subsections (f) - (g) of s 387, the respondent is not a small business and I am surprised that the procedures Mr Skettos adopted and his conduct during and after the meeting on 15 October 2012 were not more in keeping with an experienced employer with over 40 employees. It seems to me that it was open to Mr Skettos to have sought some advice or assistance in properly managing a person who obviously became a very difficult employee.

[27] I have already referred to the other matters I consider relevant in this case. In addition, they include the applicant’s medium term of service of 6 ½ years, the difficulty of finding another sales job before and after Christmas and the applicant’s personal and family circumstances.

[28] In addition, it should not be lost sight of that that the Act mandates, at s 381(2), that the Commission apply the principle of ‘a fair go all round’ to all unfair dismissal cases. This section is expressed as follows:

381 Object of this Part

(1) The object of this Part is:

(a) to establish a framework for dealing with unfair dismissal that balances:

(i) the needs of business (including small business); and

(ii) the needs of employees; and

(b) to establish procedures for dealing with unfair dismissal that:

(i) are quick, flexible and informal; and

(ii) address the needs of employers and employees; and

(c) to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement.

(2) The procedures and remedies referred to in paragraphs (1)(b) and (c), and the manner of deciding on and working out such remedies, are intended to ensure that a “fair go all round” is accorded to both the employer and employee concerned.

Note: The expression “fair go all round” was used by Sheldon J in in re Loty and Holloway v Australian Workers’ Union [1971] AR (NSW) 95.

[29] For the reasons I have already mentioned, I am satisfied that the applicant was denied procedural fairness and, as a consequence, his dismissal was unfair within the meaning of s 387 of the Act.

Remedy to be ordered

[30] s 390 of the Act requires the Commission to make a finding on the appropriateness of reinstatement where an earlier finding of unfairness is made; See: Holcim (Australia) Pty Ltd v Serafini [2011] FWAFB 7819. Given the toxic nature of the applicant’s relationship with Mr Skettos and others in the workplace, this is a palpable case where there is a complete breakdown in the trust and confidence in the employment relationship. It has been shattered beyond repair; See: Perkins v Grace Worldwide (Aust) Pty Ltd [1997] IRCA 15. Accordingly, reinstatement is inappropriate, and I so find.

[31] The applicant seeks the maximum compensation available under the Act. Perhaps understandably, neither party addressed the matters the Commission is required to take into account under s 392 when determining an amount of compensation. That section is expressed as follows:

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), FWA 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 FWA considers relevant.

Misconduct reduces amount

(3) If FWA is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, FWA 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 FWA 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 FWA 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.

[32] In my opinion, it is proper to give both parties an opportunity to provide written submissions as to an appropriate compensation order, or no order at all, as they see fit. I have deliberately quoted the terms of s 392 above, in order for each of the matters therein to be addressed in their submissions. Submissions should be filed with the Commission and served on each other within 14 days of today.

[33] I wish to emphasise that these submissions should not been seen as an opportunity to question, criticise or otherwise challenge my earlier findings or observations in the body of this decision. Nor should the submissions be used as a vehicle to reargue their case/s. Other avenues under the Act are open to the parties should they wish to do so when this matter is finally concluded. A formal decision on remedy, and any order flowing therefrom, will be published after the receipt of the submissions I have just referred to.

DEPUTY PRESIDENT

Appearances:

Applicant in person

M Skettos for the respondent

Hearing details:

2013.

Sydney:

8 February

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