Craig Sutton v Watervalley Pty Limited T/A Watervalley Pty Limited

[2017] FWC 3652

[2017] FWC 3652

FAIR WORK COMMISSION

REASONS FOR DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Craig Sutton
v
Watervalley Pty Limited T/A Watervalley Pty Limited
(U2017/2266)

COMMISSIONER PLATT ADELAIDE, 10 JULY 2017

Application for an unfair dismissal remedy – no valid reason – harsh, unjust or unreasonable – compensation awarded.

Summary

[1] On 2 March 2017, Mr Sutton lodged an application pursuant to s.394 of the Fair Work Act 2009 (the Act) seeking a remedy for an alleged unfair dismissal by his former employer, Watervalley Pty Ltd T/A Watervalley Pty Ltd (Watervalley).

[2] On 9 May 2017, directions were issued to the parties for the preparation of submissions and statements and the matter was listed for hearing on 4 and 5 July 2017 in Adelaide. Both parties submitted material in accordance with the directions.

[3] At the hearing on 4 July 2017 at 10.00am, Mr Sutton represented himself. No person attended to represent Watervalley. Ms Chloe Brinkworth, on behalf of Watervalley, advised my Associate by telephone that they had decided not to attend and apologised for not advising the Commission in advance.

[4] I determined that the hearing would proceed in the absence of Watervalley. On 4 July 2017, I read my decision on transcript and issued an Order 1 that Watervalley pay Mr Sutton $12,500 (less any deduction of taxation) within 14 days of that Order. These are the reasons for my decision.

Background and Evidence

[5] Mr Sutton provided a statement and gave evidence on his own behalf. 2 He also provided a statement of Ms Catherine Sutton.3

[6] Whilst Watervalley submitted a number of witness statements, none of the witnesses nor any representative of Watervalley attended the hearing. As a result of the failure of the witnesses to attend, I did not regard their statements as evidence. I did, however, cross-examine Mr Sutton on the key points raised in the material provided.

[7] Watervalley owns farm properties in South East South Australia. Mr Sutton was employed on one of those properties, Windarra, as a Farm Manager. His duties included responsibility for fencing, the care of sheep and steers on the property, stock records, maintenance and assisting in the transfer of stock from the property.

[8] Mr Sutton commenced his employment in February 2014 and was paid a wage of $55,000 per annum. Furthermore, he had the free use of a house on the property (estimated value of $200 per week) with electricity paid by Watervalley.

[9] Mr Sutton had worked for the previous owners of Windarra and on occasion was given the care of stock which was not in conformance with requirements such that it could be sold or could not survive without intervention (i.e. the mother had died after giving birth). Mr Sutton would intensively rear these animals on the owners’ property to a point where they could be sold. Mr Sutton met the cost of hand rearing expenses (such as milk) and was given a few of the surviving animals in return.

[10] When Watervalley purchased the property, the previous owner allowed Mr Sutton to retain all of the animals (approximately 14) to which he was giving special care.

[11] Mr Sutton reported to Mr Angas Brinkworth and another. Mr Sutton stated that prior to this employment with Watervalley, Mr Angas Brinkworth agreed that he could continue to house the animals gifted to him by the previous owners on the Windarra property unless there was a drought in which case Watervalley’s stock would be given priority.

[12] In November 2015, Mr Tom Brinkworth indirectly advised Mr Sutton that his stock needed to be removed from the property. There was no drought at the time. Mr Sutton was away at the time but commenced a process to allow the sale of the stock which were sold by Landmark on 3 November 2015 and were removed from the property.

[13] Mr Sutton believes that Mr Tom Brinkworth was unaware of the arrangement which he agreed with Mr Angas Brinkworth.

[14] In October 2015, Mr Sutton purchased a property in Mundulla and housed his personally owned cattle purchased there. His cattle at that location, when required, were tagged with PIC number SA 236232.

[15] In April 2016, Mr Sutton suffered a work related injury which prevented him from working until February 2017.

[16] In September 2016, Watervalley accused Mr Sutton of keeping some stock on the property. They said that tag (PIC SA 236232) allocated to Mr Sutton was found on a steer on Windarra. Mr Sutton denied keeping stock on the property and asked to see the tag and/or steer. Neither the tag nor the steer was produced.

[17] It was suggested that Mr Sutton’s son, Josh, told another that Mr Sutton had stock on the property. Mr Sutton said that his son was helping him process cattle on Mundulla and that his comments in relation to that cattle had been misinterpreted.

[18] Mr Sutton received a warning during his employment concerning the condition in which a house occupied by him was kept. Mr Sutton states he vacated that house two years prior to it being inspected and denied responsibility for its condition.

[19] On 3 February 2017, Mr Sutton was provided with a letter of termination signed by Mr Tom Brinkworth via Mr Sutton’s son, Josh. The letter advised Mr Sutton of his dismissal and gave three weeks’ notice. The reason for the dismissal was ‘keeping private stock on our property’ in breach of company policy.

[20] Mr Sutton’s employment and his use of the residence ended on 24 February 2017.

[21] Mr Sutton gave evidence that he was out of work for approximately 10 weeks and had to find and pay for alternative housing.

Consideration

[22] I accept the evidence given by Mr Sutton.

[23] Watervalley employed 110 persons at the time of the dismissal. 4 It is not a small business and cannot rely on the Small Business Fair Dismissal Code.

[24] I find that Mr Sutton is a person who is protected from unfair dismissal pursuant to s.382 of the Act.

[25] I find that Mr Sutton did not house his personal stock on property owned by Watervalley.

[26] Notwithstanding its formulation under a different legislative environment, I have adopted the definition of a valid reason set out by Northrop J in Selvachandran v Peteron Plastics Pty Ltd⁵which requires the reason for termination to be “sound, defensible or well founded”. I find that Watervalley did not have a valid reason to dismiss Mr Sutton. 6

[27] I find that Watervalley failed to notify Mr Sutton of the reason for the termination of his employment or to provide him with an opportunity to respond. 7

[28] Having considered each of the factors detailed in s.387 of the Act, I have concluded that Mr Sutton’s dismissal was harsh, unjust or unreasonable.

[29] Mr Sutton did not seek reinstatement and I am satisfied that it is not appropriate in this case. 8

[30] Section 390 of the Act makes it clear that compensation is only to be awarded as a remedy where the Commission is satisfied that reinstatement is inappropriate and that compensation is appropriate in all the circumstances.

[31] I now turn to whether compensation in lieu of reinstatement is appropriate.

[32] A recent Full Bench in McCulloch v Calvary Health Care Adelaide⁹ confirmed, in general terms, that the approach to the assessment of compensation, as undertaken in cases such as Sprigg v Paul’s Licensed Festival Supermarket,¹⁰ remains appropriate.

[33] Section 392(2) of the Act requires the Commission to take into account all of the circumstances of the case including the factors that are listed in paragraphs (a) to (g). Without detracting from the overall assessment required by the Act,¹¹ it is convenient to discuss the identified considerations under the various matters raised by each of the provisions.

The effect of the order on the viability of the employer - s.392(a)

[34] Nothing was put to me on this topic. However, I note that Watervalley is not a small business.

The length of Mr Sutton’s service with the employer - s.392(b)

[35] Mr Sutton was employed by Watervalley for three years.

The remuneration Mr Sutton would have received, or would have been likely to receive if he had not been dismissed - s.392(c)

[36] This involves, in part, a consideration of the likely duration of Mr Sutton’s employment in the absence of what I have found to be an unfair dismissal. I find that Mr Sutton would have continued employment for at least six months.

The efforts of Mr Sutton to mitigate the loss suffered by him because of the dismissal - s.392(d)

[37] Mr Sutton found a position approximately 10 weeks after his dismissal.

Remuneration earned by Mr Sutton during the period between the dismissal and the making of the order for compensation and the amount of any income likely to be earned by Mr Sutton during the period between the making of the order for compensation and the actual compensation - ss.392(e) and (f)

[38] Mr Sutton did not earn any wages in the 10 weeks after dismissal. Mr Sutton obtained employment at a wage rate higher then he received from Watervalley about 10 weeks after his dismissal.  12

Any other matter that the FWC considers relevant and the remaining statutory parameters - s.392(g)

[39] There are no other relevant matters.

[40] In accordance with s.392(4) of the Act, I make no allowance for any shock, distress or humiliation that may have been caused by the dismissal.

[41] The maximum compensation limit in this case would be the lesser of 26 weeks remuneration or $68,350. 13 The amount of compensation awarded is less than that limit.

[42] Taxation is to be paid on the amount determined.

[43] The compensation confirmed below is also appropriate having regard to all of the circumstances of this matter and the considerations specified by the Act.¹⁴

[44] Applying the principles in Sprigg, I have determined to award compensation in the amount of $12,500 to be paid within 14 days of the date of the Order. 15

[45] An Order 16 reflecting this decision was issued on 4 July 2017.

COMMISSIONER

Appearances:

Mr C.Sutton the Applicant.

No appearance on behalf of the Respondent.

Hearing details:

2017.

Adelaide:

4 July.

 1   PR594265

 2   Exhibit A1 and A2

 3   Exhibit A3

 4   See form F3 Employer Response

5 (1995) 62 IR 371 at 373

 6   See s.387(a) of the Act

 7   See s.387(b),(c) of the Act

 8   See s.390(1), (3)(a) of the Act

9 [2015] FWCFB 873

10 (1998) 88 IR 21. See also Bowden v Ottrey Homes Cobram and District Retirement Villages Inc T/A Ottrey Lodge[2013] FWCFB 431

11 Smith and Others v Moore Paragon Australia Ltd (2004) 130 IR 446

 12   Steggels Ltd v West (unreported, AIRCFB, Watson SDP, Williams SDP, Smith C, 11 May 2000) Print S5876 [21]; citing Sprigg v Paul’s Licensed Festival Supermarket (1998) 88 IR 21; citing Shorten v Australian Meat Holdings (1996) 70 IR 360, 376

 13   Section 392(5) of the Act

14 Smith and Others v Moore Paragon Australia Ltd (2004) 130 IR 446 at par [32]

 15   PR594265

 16   PR594265

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<Price code C, PR594456>