Craig Collis v Rossglengary Pty Ltd

[2013] FWC 5403

[2013] FWC 5403

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Craig Collis
v
Rossglengary Pty Ltd
(U2012/17008)

COMMISSIONER DEEGAN CANBERRA, 6 AUGUST 2013

Application for unfair dismissal remedy - jurisdictional objection - whether termination at initiative of the employer - constructive dismissal - dismissal was unfair - compensation ordered.

[1] On 20 December 2012, Mr Craig Collis (the applicant) filed an application under s.394 of the Fair Work Act 2009 (the Act) claiming that he had been unfairly dismissed by Rossglengary Pty Ltd (the respondent) in December 2012.

[2] The matter was unable to be settled at a conciliation held on 29 January 2013. Directions were issued for the filing of submissions and supporting statements and the matter was listed for hearing on 24 April 2013. Due to the unavailability of the respondent that listing was cancelled and the matter eventually relisted for 21 June 2013.

[3] Witness statements were filed by the applicant and directors of the respondent, Mr Glenford Wisby and Mrs Debbie Wisby, his wife. At the hearing, both parties were granted permission to be represented by legal practitioners.

Background

[4] The main facts of the matter are not in dispute.

[5] The applicant was employed for approximately 10 years as a deckhand on a boat owned by the respondent and operated by Mr Wisby. Mrs Wisby handled many of the financial aspects of the business, including the payment of wages.

[6] According to his witness statement, the applicant:

• Was usually on the boat with a crew of only one or two people;



• Worked varying hours but often more than 5 days per week;



• Was not paid wages but a percentage of the value of the catch.

[7] On 12 December 2012, the applicant returned from a fishing trip and asked Mr Wisby for some of his outstanding wages. He was given a cheque for $640.00 and evidenced dissatisfaction with this amount.

[8] The applicant told Mr Wisby that he could not return to sea that day unless he was paid an additional sum towards his outstanding wages. He removed his bedding and some wet weather gear and left the boat.

[9] In the early afternoon of that day the boat left the dock and headed out to sea without the applicant.

[10] The applicant did not continue his employment with the respondent after 12 December 2012.

The Applicant’s Case

[11] The applicant filed a witness statement 1 and expanded on this at the hearing. He stated that he was originally employed by the respondent on a part-time basis and had been employed in his current position since 2006. According to the applicant he worked irregular hours, depending on weather and the season. Generally he worked the scallop season from late June until Christmas, the crayfish season prior to the scallop season. He also worked catching squid which were available all year, but more plentiful from late October until March. On occasions if the season was not open they would carry out maintenance work on the boat.

[12] The applicant’s evidence was that he received varying amounts of payments from the respondent depending on the nature of the catch (squid, crayfish or scallops) and the market price. The applicant’s percentage of the catch took into account the respondent’s costs and the number of the crew on the boat.

[13] The applicant explained that when he was first employed by the respondent he was always paid when they returned to the wharf, with any adjustments being made in later payments. After Mr Wisby married the wages were paid later and later. It was his understanding that Mrs Wisby was of the view that deckhands did not get paid until the respondent was paid.

[14] On 12 December 2012, the applicant needed to drive to Hobart from Triabunna to register his car. He had collected a wages cheque from Mr Wisby prior to heading to Hobart and discovered when he went to bank it that it was much less than he had expected. The applicant was aware that Mr Wisby intended to return to sea that afternoon so he approached him to explain that he needed more of his wages as he did not have enough money to give to his family for their support in his absence. The applicant had been given a cheque for $640 but had been expecting in excess of $800.

[15] Mr Wisby had explained that his wife had written the cheque and that there was nothing he could do about it. The applicant had responded that it was getting close to Christmas and he needed the money he was owed. He then advised Mr Wisby that he would not go back to sea until he was paid as he could not afford to do so. He informed Mr Wisby that his family did not have food. He told Mr Wisby that he was going to take his ‘stuff off the boat and not go (on) this trip... until he fixed (his) wages up’ 2.

[16] The applicant explained that he had taken his bedding from the boat so that it could be washed and had taken his wet weather gear (which was relatively valuable) as he was afraid it might be stolen. He had left other personal items, including clothes and a DVD player, on the boat.

[17] After his conversation with Mr Wisby the applicant returned to his home. He expected that Mr Wisby would come to him and pay him some extra money, as he had done on several occasions in the past. Mr Wisby did not come to his house and a little later he saw the boat leaving the wharf. He tried to call Mr Wisby’s mobile phone a number of times but it was not answered. He then called Mrs Wisby and asked why the boat had left without him. Mrs Wisby explained that her husband had informed her that the applicant had quit. The applicant told her that he had told Mr Wisby he could not go on another fishing trip unless he was paid his wages and had no intention of quitting.

[18] The applicant made a number of unsuccessful attempts to contact Mr Wisby by phone and then sent several text messages to Mrs Wisby asking if he had been sacked. Mrs Wisby had replied that he had resigned and had collected his belongings off the boat. On 15 December the applicant sent a text message to Mrs Wisby advising that he had not resigned and had only taken his gear as someone was stealing things from the boat.

[19] On 18 December the applicant received an Employment Separation Certificate and two cheques, one for $2000 and one for $60. He believed he was owed at least $2211.50. He attempted to contact the respondent to discuss his wages but was unsuccessful.

[20] Since the termination of his employment the applicant has had a couple of odd jobs for fishermen (5 days and 1 day) and was paid in kind. He commenced working in a full-time position on a fishing vessel since 5 May 2013.

[21] Under cross-examination, the applicant stated that the work he performed had been regular but his payments had been irregular. When it was put to him that the market for scallops and crayfish was more certain than for squid the applicant responded that he had been told by Mr Wisby that he would be getting $2.50 to $3.50 for squid all year round. The applicant agreed that between 2006 and 2012 he had mainly fished for scallops and crayfish. He also agreed that he had always been paid what he was entitled to over that period. The applicant also agreed that the squid fishing had only commenced in 2012, about the end of July. Immediately prior to that the boat was being refitted and the applicant had only limited income.

[22] The applicant was then questioned about why he thought he was entitled to more than $640 when paid on 12 December:

And you thought that you thought your entitlement was $820?---Around that - yes, 11 per cent of the catch. I knew we'd sold three ton, it's not hard to work out three ton at $2.50.

But if it was three tons at a lesser price than $2.50 then your entitlement - - - ?

---But it wasn't - Glen had told me it was $2.50 is what we were getting paid. They were small squid, they were bait fish and they were being sold to locals who were paying $2.50.

So overall your dispute was over $180?---Well, not just that - over - at - up until that point we'd got 18.3 ton of squid and I hadn't been paid for any of it.

[23] The applicant conceded that he had been paid a further $2060 on 18 December 2012.

[24] It was put to the applicant that he had not returned to the boat in time to go to sea that afternoon. The applicant stated that no time had been set for leaving and that he would normally have been contacted by Mr Wisby advising him of the time of departure.

[25] It was submitted for the applicant that he had not resigned his employment but had been dismissed by the respondent. The applicant had asked to be paid the wages owing to him and had refused to go fishing until those wages were paid. He did not resign. It was also put that the termination was not effected in accordance with the Small Business Fair Dismissal Code.

The Respondent’s case

[26] Mr Wisby had also filed a witness statement 3. He stated that Mr Collis had been employed on a casual seasonal basis, had never been employed full-time and had no award entitlements but an entitlement to a percentage of the catch. Mr Wisby’s evidence covered the calculation of the applicant’s percentages of each type of catch. It also covered the prices paid for squid since January 2013. He gave further oral evidence about the varying percentages paid for catches and the deductions made for the ‘quota’ and storage costs.

[27] According to Mr Wisby, on 12 December the applicant came to the boat and told him he quit and that Mr Wisby could “shove it”. Mr Wisby explained to the applicant that he was being paid the correct percentage and could not be paid any earlier than the company was paid. It was Mr Wisby’s evidence that the applicant resigned and left the boat. Mr Wisby had then gone home and informed his wife that the applicant had resigned. In his oral evidence, Mr Wisby stated that during the conversation the applicant had told him that he ‘couldn’t go on that way’ and when he told the applicant that he could not pay him any more money the applicant had said ‘I can’t come then’. 4

[28] It was Mr Wisby’s evidence that when he returned to the boat an hour or so later the applicant was not on board and had removed all his gear, including gear that he had left on board when the boat had undergone the refit. The boat then left the wharf with only Mr Wisby and the other deckhand. It was Mr Wisby’s evidence that he made no attempt to contact the applicant.

[29] Mr Wisby stated that there was stock on board the boat and in storage which was not sold at that time. Annexed to Mr Wisby’s statements were records of the catches, quotas and payments of the company for the period.

[30] Under cross-examination, the witness agreed that the price for squid varied but claimed that he had not told the applicant this as he did not know it at the time.

[31] Mrs Debbie Wisby’s evidence was that she had been involved in the management of the business of the respondent since 2007 and had been responsible for writing the wages cheques in recent times. She stated that she calculated the wages as a percentage of the price paid for the catch less the quota, storage and any freight cost. She noted that as at 12 December only part of the recent catch had been sold and some remained in storage or on board the boat. It was also her evidence that as at that date ‘a price hadn’t been determined and it was also - it was very early in the set up of the whole business...’ 5.

[32] It was also the evidence of Mrs Wisby that after December 2012 the respondent began paying the crew in advance on the basis of the expected payment with any adjustments made at a later date.

[33] Under cross-examination, Mrs Wisby conceded that the payment docket given to Mr Collis with his wages merely stated the gross amount paid and the tax withheld. There was no statement of the price of the catch, the costs deducted or the percentage paid.

[34] It was submitted for the respondent that the principal question in this matter was whether the applicant resigned or was dismissed, constructively or not. It was put that the practice that was adopted by the company in payment of wages to its employees was in accordance with practices within the fishing industry.

[35] It was further argued for the respondent that no evidence had been adduced by the applicant upon which compensation could be calculated although this had since been provided by the company. It was noted that the industry concerned was an irregular industry with irregular payments, dependent upon the market and payment by purchasers. On that basis it was argued that the respondent had not failed in its obligations to the applicant.

Consideration

[36] Section 386 of the Act provides as follows:

386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

[37] The applicant has maintained throughout these proceedings that he did not resign his employment with the respondent. He informed the respondent that unless he was paid the wages owing to him he would not go to sea that day. Although Mr Wisby claimed in his statement that the applicant had actually stated that he was quitting and that he resigned during the conversation, I am satisfied by the oral evidence given by Mr Wisby, which is consistent with the applicant’s evidence, that the applicant said only that he ‘couldn’t go on that way’ and that if he received no further wages he ‘can’t come then’.

[38] I am prepared to accept, however, that the applicant by his words and his actions (in removing his gear from the boat) actually resigned from his employment that day. It appears that the applicant changed his mind when he realised that the employer had gone to sea without him and I accept his evidence that he believed his employer would pay the wages owed or at least some part of them, in order to persuade the applicant to go to sea.

[39] I am also satisfied, on the evidence, that although the applicant did resign from his employment he was forced to do so because of the conduct of his employer.

[40] The applicant was forced to resign from his employment as a consequence of his employer’s conduct in refusing to pay him wages that were owed to him for work already performed. A failure by an employer to pay proper wages is a fundamental breach of the employment contract. I am not satisfied that, as was claimed by the respondent, all the wages that were owed on 12 December 2012 had been paid. No proper explanation was provided to the applicant as to the basis upon which the wages calculation was made and there was no written agreement to support the employer’s claim as to the percentage due to the applicant. Given Mr Wisby’s refusal to either pay the additional wages or provide a proper explanation for his refusal to do so then I am satisfied that the applicant was forced to resign his position.

[41] Pursuant to s.386(1)(b) of the Act the applicant was dismissed.

Was the dismissal unfair?

[42] The only objection made to the jurisdiction of the Commission in relation to this application is that there was no dismissal at the initiative of the employer. I am therefore satisfied, on the basis of all the information supplied by the applicant and the respondent, that the applicant is a person protected from unfair dismissal and that the termination of the applicant’s employment was not for reasons of genuine redundancy.

[43] Although the respondent is clearly a small business subject to the provisions of s.386(2) of the Act, no claim was made that the employer complied with the Small Business Fair Dismissal Code.

[44] I now turn to those matters set out in s.387 of the Act.

[45] I find that there was no valid reason for the termination of the applicant’s employment. The applicant was entitled to be paid wages owed to him. Despite the respondent’s claim that there was ‘an understanding’ about the wages not being paid until the company was paid and there being an agreement as to the percentage of the catch to which the applicant was entitled, clearly this was not so. I accept the applicant’s evidence that he was expecting a payment of at least $820 on 12 December. He had based that expectation on the information given to him by Mr Wisby as to squid prices. It was incumbent on Mr Wisby to give the applicant a proper explanation as to the reason for the payment that was made and to at least have had in place some proper agreement about the percentage to be paid and the appropriate deduction of costs from the price paid for the catch. In the absence of these things it is unsurprising that the applicant was concerned about the payment that was actually made.

[46] I find that it was open to the applicant to refuse to continue to perform work for the respondent in the absence of payment of wages or at least a reasonable explanation of how the payment made was calculated. It was not reasonable of the respondent to refuse either to pay the applicant an additional amount or at least to provide a satisfactory explanation of its failure to do so.

[47] It is apparent from the manner in which the termination of the applicant’s employment was effected that those matters at s.387(b) to (e) have no relevance.

[48] So far as the matters at s.387(f) and (g) are concerned, I am satisfied that the size of the respondent’s business and the lack of human resources expertise impacted on the procedures followed in effecting the dismissal.

[49] I take into account the fact that the respondent has only one or two employees and that the fishing industry operates, it would seem, on an extremely irregular basis so far as employment practices are concerned. It is unlikely in any other business that an employee would be required to assume part of the risk of the business, wait for payment of wages until the business had been paid for the produce and contribute to the cost of production. This is apparently the case in relation to this employment relationship and I am tasked only with determining if the termination of that relationship was unfair, not whether the terms of the relationship itself were in accordance with the law.

[50] Both parties in this matter were represented by legal practitioners and the parties agreed that the applicant was an employee. It was the respondent’s evidence that tax was withheld from the employee’s wages and superannuation contributions were paid into a fund by the employer for the employee’s benefit.

[51] As there is no dispute that the applicant was an employee who had worked for the employer for over 10 years, I must find that the arbitrary manner in which he was dismissed for disputing the amount of wages he had been paid was harsh, unjust and unreasonable.

[52] The dismissal was unfair.

Remedy

[53] The applicant has obtained other employment and does not seek reinstatement. Given the size of the respondent and the close working relationship that must exist between the director and its employees I would not consider reinstatement an appropriate remedy, in any case.

[54] I do consider that it is appropriate to compensate the applicant in lieu of reinstatement.

[55] Section 392 of the Act sets out the matters that must be taken into account in determining the amount of compensation.

[56] While there was evidence that the respondent was finding it difficult to make payments at the time of the applicant’s termination, having spent a large amount of money on the boat, there was no submission put that any award of compensation would affect the viability of the respondent’s business.

[57] The applicant had been employed by the respondent for a period in excess of 10 years. While up until 2006 the applicant was also engaged in other employment, since 2006 he had been employed solely by the respondent. The respondent claimed that the employment was both casual and seasonal. I am satisfied that the applicant relied entirely on the respondent for earned income and worked the equivalent of a full-time job whenever the boat was operating.

[58] It is difficult to determine what income the applicant might have continued to receive had his employment not been terminated. His income was totally dependent upon the size of the catch and the price obtained for it.

[59] The applicant sought and obtained other employment. Opportunities were limited for employment of a person with the applicant’s skills in the region in which he and his family reside. There was no evidence as to the earnings of the applicant in his new position, but as he is employed as a deckhand it is reasonable to infer that he is probably paid under similar arrangements as existed during his employment with the respondent and his earnings are unlikely to be regular.

[60] In my view given the irregularity of the amount of the earnings, and the payments made to the applicant, it is appropriate that I determine an actual monetary amount of compensation rather than couching an order in terms of number of weeks’ wages.

[61] The respondent’s evidence was that in the six months prior to the applicant’s termination he earned a gross amount of $19,874.64.

[62] I intend to order that, in lieu of reinstatement, the respondent pay to the applicant the amount of $6,000 as a gross payment and taxed as appropriate. An order [PR539844] to this effect is published separately.

COMMISSIONER

Appearances:

Ms I. Tiang, Solicitor, for the Applicant

Mr S. Chopping, of Counsel, for the Respondent.

Hearing details:

2013.

Hobart:

June 21.

 1   Exhibit C1.

 2   Transcript PN41.

 3   Exhibit W1.

 4   Transcript PN376-381.

 5   Transcript PN459.

Printed by authority of the Commonwealth Government Printer

<Price code C, PR539841>