David Johnston v The Trustee for the MTGI Trust T/A Macquarie Technology Group International

[2014] FWC 7098

[2014] FWC 7098 [Note: An appeal pursuant to s.604 (C2014/7752) was lodged against this decision and the order arising from this decision - refer to Full Bench decision dated 23 March 2015 [[2015] FWCFB 1288] for result of appeal.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

David Johnston
v
The Trustee for The MTGI Trust T/A Macquarie Technology Group International
(U2014/345)

JUSTICE BOULTON, SENIOR DEPUTY PRESIDENT SYDNEY, 24 OCTOBER 2014

Application for relief from unfair dismissal - application by the respondent for interlocutory orders dismissing the unfair dismissal application - conduct of the parties in the proceedings - whether the applicant was entitled to personal/carer’s leave - scope of “unexpected emergency” within the meaning of s.97 of the Fair Work Act 2009 - whether dismissal was at the employer’s initiative - whether the applicant abandoned his employment - whether dismissal was harsh, unjust or unreasonable - reinstatement not appropriate - order for compensation.

[1] This is an application made under s.394 of the Fair Work Act 2009 (the Act) by David Johnston (the applicant) for an unfair dismissal remedy against his employer, Macquarie Technology Group International Pty Ltd as Trustee for The MTGI Trust (the respondent).

[2] The applicant alleged that he was unfairly dismissed by the respondent because of his absence from work as a result of the unexpected premature birth of his child and the need for him to provide primary care for his four other young children during the period his wife and new born baby were in hospital. The respondent alleged that the applicant had abandoned his employment.

[3] The hearing before me was held on 6 and 12 August 2014. Mr Vasili Maroulis, solicitor, was granted permission to appear for the applicant. Mr Paul Wallace, CEO and director, appeared for the respondent. Sworn evidence was given in the proceedings by the applicant 1 and by Mr Ian Kerr, the respondent’s bookkeeper.2 The hearings were held in Sydney with a video link to Brisbane.

[4] The hearings of this matter were unnecessarily protracted and the determination of the matter more difficult largely as a result of the conduct of the respondent and its representative. This conduct included failure to comply with directions as to the filing of submissions and witness statements, 3 making allegations and complaints about both the conduct of the Commission’s proceedings and the conduct of the applicant’s solicitor, misleading the Commission and the applicant about legal representatives acting for the respondent or having given legal advice about the proceedings4, making and then unreasonably withdrawing offers of settlement, seeking the adjournment of proceedings without due cause, and generally seeking to delay and frustrate the proper hearing process.

[5] Despite the complications resulting from the approach adopted by the respondent to the proceedings, the factual background to the matter is relatively straightforward and may be briefly set out as follows:

• The applicant and his family live in Bomaderry, a small town near Nowra on the South Coast of NSW, approximately 160 kms from Sydney.

• The applicant was employed by the respondent from July 2008 until 16 January 2014 and worked from his home. The respondent has its office in Yatala, a suburb of Gold Coast City, Queensland. The respondent is the Australian distributor of InfiNet Wireless products and the applicant’s position required him to support sales, predominantly selling products from InfiNet Wireless. He was also required to assist with customer training and technical support. 5

• On 7 November 2013 the applicant’s wife gave birth to a son, who was born by an emergency caesarean operation 10 weeks premature at the Royal Hospital for Women, Randwick.

• The applicant took approved leave from about 11 November 2013 until 3 January 2014 to care for his four other dependent children while his wife was in hospital in Sydney.

• On 12 December 2013 the applicant provided to the respondent a letter from the Royal Hospital for Women supporting a request for the annual leave to be taken as personal leave. The letter said that it was expected that the mother and child would remain in hospital in Sydney until 29 January 2014. No direct response was received from the respondent in relation to the request.

• On 20 December 2013, Mr Kerr emailed the applicant informing him as follows:

“Assuming you will be on holidays your leave will take you up to Friday 03/01/14.”

• The applicant did not return to work on Monday 6 January 2014 and did not contact the respondent to discuss his absence.

• On 11 January 2014, Mr Wallace emailed the applicant congratulating him on the birth of his new son and raising various matters regarding his unsatisfactory work performance, particularly relating to price lists supplied to customers.

• On 16 January 2014 the applicant returned to work and sent an e-mail to Mr Wallace and others querying the pay he had received on 15 January 2014.

• There were a series of emails from Mr Wallace and other employees of the respondent later on 16 January in response to the applicant’s email. Some parts of Mr Wallace’s emails were particularly offensive. 6 However leaving that aside, the effect of the response emails was as follows:

• it was claimed that the applicant had abandoned his employment by not returning to work after his approved leave entitlements ran out on 3 January 2014; and



• it was said that the applicant was not entitled to paid personal/carer’s leave as the circumstances relating to his wife’s hospitalisation did not amount to an “unexpected emergency” within the terms of the Act.

[6] The applicant filed an unfair dismissal application on 7 February 2014. The employer’s response to the application was filed by Mr Wallace on behalf of the respondent on 18 March 2014. A conciliation conference was held on 17 April 2014 by telephone but was not successful in resolving the matter. Directions were issued on 23 May 2014 for the filing of written outlines of submission and witness statements and the matter was listed to be heard in Sydney on 6 August 2014.

[7] The written outline of applicant’s submissions is dated 23 June 2014 and was lodged by his solicitor. 7 The witness statement provided by the applicant is dated 19 June 2014 and attaches relevant medical advice and certificates and email correspondence.8 The respondent’s outline of submissions is dated 23 June 2014 and was filed by the respondent’s lawyers.9 The lawyers filed a notice on 21 July 2014 advising that they had ceased to act for the respondent. The only witness statement provided by the respondent was that by Mr Ian Kerr dated 11 August 2014,10 which was filed on the morning of the second day of the hearings on 12 August 2014.

[8] On 21 July 2014 a request was made by the respondent to have the matter heard in Queensland on the basis that all of the respondent’s seven proposed witnesses were based on the Gold Coast. The change of venue was opposed by the applicant. The application for a change of venue for the hearing was rejected, although a video conference facility was organised so that the respondent and its witnesses could attend the hearing by video link from Brisbane. As it turned out, only one witness was called by the respondent to give evidence.

The respondent’s application to dismiss the unfair dismissal claim

[9] On 30 July 2014 an application was received from Mr Wallace for the respondent seeking to have the matter dismissed on the followings grounds: the unfair dismissal application is frivolous and lacks any reasonable prospect of success (s.587(1)(b) and (c) of the Act); the unfair dismissal application is an abuse of process; and the pursuit of the application by the applicant’s legal representative has been negligent and may constitute professional misconduct pursuant to s.497 of the Legal Profession Act 2004 (NSW). In support of the application to dismiss, the respondent on 31 July 2014 provided by e-mail a response to the applicant’s witness statement.

[10] The main basis for the application to dismiss concerned the entitlement of the applicant to paid personal/carer’s leave because of his wife “giving birth to a premature baby via surgery” and the assertion by the respondent that the applicant was not so entitled because his wife did not “suffer an unexpected emergency within the meaning of the Act and (the applicant) did not act as her carer”. The respondent also disputed aspects of the applicant’s witness statement including the claim that his employment was terminated by the respondent. The respondent maintained that the applicant had abandoned his employment. The respondent sought a permanent stay of the proceedings as well as costs on an indemnity basis.

[11] On 5 August 2014 at 12.12pm the respondent sent an email to the Commission reiterating its application to have the unfair dismissal application dismissed. The email provided a “short recap” of the previous submissions in support of the respondent’s application as follows:

“The Application is one that unambiguously seeks compensation for ‘paid parenting leave entitlements’. As basically 100% of all mature Australians would know, PAID parental leave does not exist in Australian law today & that occurs via the current Abbott Government contemplating the introduction of provisions that WILL allow for PAID parental Leave Entitlements.

The application, with respect does not ever vary in its demand for the Applicant to be paid to remain at home providing care for his children, none of which were ever claimed to be sick or injured in any way. It is simply a utterly unsustainable claim that demand the Respondent substitute annual leave payments with sick leave entitlements, in the absence of being sick or injured.

Further, the legal representative for the Applicant, has, with respect, abused its duty to the Commission to not waste the Commissions time with applications that are, in effect, in breach of S587 of the FWA.

Lastly, we respectfully submitted that the Applicant’s conduct, in using these proceedings to achieve a commercial advantage via causing the Respondent to lose its credibility with its customers, in favour of the new & alternate Distributer (personally appointed by the Applicant during this process in his other related employment) to be a clear case of Abuse of Process’.

That abuse was compounded by the two delays to these proceedings caused by the Applicant without good reason...”

(emphasis in original)

[12] The respondent requested that its application be determined by 3.00pm on 5 August 2014 so as to avoid it being put to any further expense in relation to hearing set down for the next day.

[13] On 5 August 2014 at 1.19pm my associate responded to the respondent’s email advising that the matter was listed for hearing on 6 August to enable the Commission to hear submissions and evidence from the parties as to the proper determination of the unfair dismissal application. The respondent was reminded that it had not filed any witness statements as required by the directions previously issued by the Commission.

[14] On 5 August 2014 at 4.53pm, an email was sent by the respondent to my chambers and to the President of the Commission attaching a purported appeal regarding the failure to determine its application to dismiss the unfair dismissal application and requesting a stay of the proceedings listed for 6 August 2014. The President’s associate advised Mr Wallace as follows:

“I refer to your email below and attached correspondence.

The President is not able to intervene or comment on how other Members of the Fair Work Commission conduct their proceedings.

Members of the Commission are required to act ‘judicially’ in the sense that they are obliged to provide procedural fairness and to determine matters impartially. As such it is advisable you raise any concerns you have about the handling of your matter with Justice Boulton at the beginning of your proceedings tomorrow.

Justice Boulton’s chambers have advised me that they have requested Video Link between the Commission’s Sydney and Brisbane offices to assist in minimising the cost of proceedings. For further assistance please refer future correspondence relating to your matter directly to Justice Boulton’s chambers.”

[15] The hearings in the matter were conducted before me on 6 and 12 August 2014. In the hearings, Mr Wallace continued to request that his application be dealt with before consideration of the evidence and submissions relating to the unfair dismissal application. It was indicated to Mr Wallace that in my view the application was based on a fundamental misunderstanding of the relevant legislative provisions, and that the application would be dealt with in the course of the proceedings and the applicant would be given an opportunity to respond. 11

[16] Having heard the submissions of the parties in relation to the respondent’s application to dismiss the proceedings and having read the further submissions forwarded to the Commission after the hearings, I am satisfied that there is no proper basis on which to grant the application. The main submission of the respondent was to the effect that the applicant was not entitled to take personal/carer’s leave in the circumstances of this matter.

[17] The relevant provisions relating to paid personal/carer’s leave are found in ss.96 and 97 of the Act. Section 96 sets out the entitlement to such leave. Section 97 deals with the circumstances in which an employee is entitled to seek leave as follows:

“97 Taking paid personal/carer’s leave

An employee may take paid personal/carer’s leave if the leave is taken:

(a) because the employee is not fit for work because of a personal illness, or personal injury, affecting the employee; or

(b) to provide care or support to a member of the employee’s immediate family, or a member of the employee’s household, who requires care or support because of:

(i) a personal illness, or personal injury, affecting the member; or

(ii) an unexpected emergency affecting the member.

Note 1: The notice and evidence requirements of section 107 must be complied with.

Note 2: If a female employee has an entitlement to paid personal/carer’s leave, she may take that leave instead of taking unpaid special maternity leave under section 80.

[18] The circumstances in which the applicant in the present matter was seeking to take personal/carer’s leave were the hospitalisation of his wife and her premature baby in Sydney, some 2½ hours drive from their home in Bomaderry, and the need for the applicant to provide the primary care for his other four young children, aged 2, 3, 4 and 13 years, during his wife’s hospitalisation. In my view, the applicant in these circumstances was entitled to take personal/carer’s leave in order to provide care and support for members of his immediate family (the four young children) who required that care because of an unexpected emergency affecting them (the prolonged hospitalisation of their mother, following the premature birth by caesarean operation). 12 The respondent was made aware of the circumstances relating to the proposed taking of personal/carer’s leave and no issue was raised at the time in relation to the notice given by the applicant.13

[19] Other grounds later relied upon by the respondent in support of its application included that Macquarie Technology Group International Pty Ltd was dismissed as trustee for the MTGI Trust prior to the proceedings beginning and that the applicant was improperly using the proceedings to improve his commercial interests with other groups. However no evidence was led in regard to these submissions and therefore, despite the many e-mails forwarded to the Commission by Mr Wallace, little reliance can be placed upon them. Indeed the nature of some of the assertions made in the e-mails 14 tends to raise questions about both their relevance and veracity. It is noted that the applicant’s payslip in January 2014 was provided by “Macquarie Technology Group Int Pty Ltd atf The MTGI Trust”.15 At no stage during the hearings did the respondent advise the Commission that the trustee had been dismissed prior to the proceedings being commenced and no evidence was sought to be presented during the hearings to this effect.

[20] Given that the main basis for the respondent’s application relates to the claim that the applicant was not entitled to personal/carer’s leave in the circumstances, and that this is based on a misunderstanding of the relevant legislative provisions, there is a sufficient basis for dismissing that application. However there are other reasons for the rejection of the respondent’s application. These relate to the merits of the s.394 application (considered below) and the appropriate manner in which the applicant and his legal representative have sought to pursue the unfair dismissal claim in proceedings before the Commission and in accordance with the Act. The respondent has not demonstrated any reasonable basis for the Commission not to proceed to hear and consider an application for an unfair dismissal remedy which was lodged in accordance with the Act and supported by evidence and submissions filed in accordance with directions issued by the Commission.

[21] I now turn to consider the applicant’s unfair dismissal application.

The unfair dismissal application

[22] The objects of the Act in providing unfair dismissal remedies is set out in s.381 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.”

[23] The procedures and remedies referred to are intended to ensure that a “fair go all round” is accorded to both the employer and employee concerned (s.381(2)).

[24] Section 385 provides:

“385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.”

[25] Although it would seem that the respondent is a small business, there was no submission to the effect that it had complied with the Small Business Fair Dismissal Code in terminating the employment of the applicant. 16 In any event, there was no evidence presented which would support findings as to serious misconduct on the part of the applicant or that the applicant was warned that he was at risk of dismissal and given an opportunity to respond to the warning and to rectify any problems regarding his performance etc. Accordingly I am satisfied that the dismissal was not consistent with the Code. I am also satisfied that the dismissal was not a case of genuine redundancy.

[26] Having regard to the submissions and evidence presented, there are three main questions to be considered in relation to the s.394 application:

• was the applicant dismissed from his employment;

• if the applicant was dismissed, was the dismissal harsh, unjust or unreasonable; and

• if the dismissal was unfair, what is the appropriate remedy?

[27] I now turn to consider these matters.

(i) Was the applicant dismissed?

[28] Section 386 of the Act sets out the circumstances in which a person is taken to be dismissed. Subsection (1)(a) provides that a person will be taken to have been dismissed if his or her employment with the employer was terminated at the employer’s initiative. Subsection (1)(b) provides that a person has been dismissed if they resigned from their employment but were forced to do so because of conduct, or a course of conduct, engaged in by the employer.

[29] The applicant submitted that the dismissal was at the initiative of the respondent and that he did not abandon his employment.

[30] The respondent submitted that the applicant was not dismissed but rather abandoned his employment. It was said that the applicant abandoned his employment when he failed to return to work on 6 January 2014. It was further submitted by the respondent that “it had no choice but to assume that the applicant had abandoned his employment given his extremely heavy workload at home with his four young children in combination with fact that the respondent did not hear from the applicant until 10 working days had passed after his leave entitlements had run out.” 17 It was also submitted that the applicant never intended to return to work for the respondent for a variety of reasons including because Mr Wallace had counselled the applicant’s wife on domestic violence matters and because the applicant knew that he could make more money working for other groups.

[31] On the basis of the evidence presented, I am satisfied that the applicant did not abandon his employment with the respondent. There is nothing about the applicant’s conduct which indicated an intention to abandon his employment or to resign therefrom. The applicant took approved annual leave and then relied upon the support letter from the hospital to seek to transfer that leave to personal leave which he had accrued. He was never advised by the respondent that his request to transfer annual leave to personal leave was denied or that the respondent would consider that he had abandoned his employment if he did not return to work on 6 January. The applicant attended for work on 16 January and was advised later that day that the respondent considered that he had abandoned his employment.

[32] The full court of the Industrial Relations Court in Mohazab v Dick Smith Electronics Pty Ltd (No 2) 18considered what is termination at the initiative of the employer. It was said that:

“... an important feature is that the act of the employer results directly or consequentially in the termination of the employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment.” 19

[33] Other authorities suggest that for termination of employment to be at the initiative of the employer, it needs to be proved that the employer’s conduct intended to bring the employment to an end, or “on any reasonable view, would probably have that effect.” 20

[34] A consideration of the facts of this matter suggests that the respondent initiated the end of the employment relationship. The respondent was aware of the request for the applicant to take personal/carer’s leave and knew the circumstances in which such leave was sought. The respondent was aware that the applicant was having a family crisis brought on by the premature birth of his son and the need for the prolonged hospitalisation of his wife and baby in Sydney. The respondent was also aware of the family circumstances of the applicant, including that he had four children to care for at home. Although it was claimed in submissions that the respondent had advice that the applicant was not entitled in the circumstances to access his accrued personal/carer’s leave, the respondent never advised the applicant that the request for personal leave was denied or indeed that he was not entitled to take such leave.

[35] Apart from those matters, the conduct of the respondent was not consistent with the claim that the applicant had abandoned his employment by not returning to work after 3 January. Mr Wallace was in contact with the applicant by e-mail on 11 January and, whilst the e-mail conveyed dissatisfaction with the applicant’s work performance, it did not suggest that the applicant was no longer employed by the respondent. Further, the suggestion that the applicant had abandoned his employment was only raised after he returned to work on 16 January 2014 and after he queried the pay received for that month. Partly in response to that request, there was a series of what have been described as “disgraceful” e-mails sent to the applicant by Mr Wallace on 16 and 17 January, continuing to assert that the applicant was not entitled to take personal/carer’s leave and that he had abandoned his employment by not returning to work after his holiday entitlements ran out.

[36] In all the circumstances, I have come to the conclusion that the actions of the respondent brought the employment relationship to an end. Accordingly I find that the applicant was dismissed at the initiative of the employer.

(ii) Was the dismissal harsh, unjust or unreasonable?

[37] In determining whether a dismissal was harsh, unjust or unreasonable, the Commission must have regard to the matters listed in s.387 of the Act which are as follows:

“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.

[38] In considering whether there was a valid reason for termination relating to a person’s capacity or conduct, the Commission will have regard to what was said by Northrop J in Selvachandran v Peteron Plastics Pty Ltd 21:

“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 reason must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business.” 22

[39] Each of the elements identified in s.387 must be considered independently 23 and consideration of each element is mandatory.24

[40] The assessment as to whether there was a valid reason for the dismissal entails a consideration of the nature of the conduct in the full context in which it occurred. 25 Conduct relied upon to justify a dismissal cannot be considered in a vacuum and consideration must be given to matters which mitigate the seriousness of any conduct relied upon by the employer. Even if it is found there was a valid reason for the dismissal, an overall assessment must be made as to whether the dismissal was nonetheless harsh, unjust or unreasonable. For example, a dismissal may still be harsh having regard to the circumstances of the employee concerned and the impact of the dismissal.26 Such considerations may be matters considered to be relevant under s.387(h) of the Act.27

[41] I now turn to consider these matters.

s.387(a) Valid reason

[42] Given the approach adopted by the respondent in the proceedings it is difficult to identify with certainty the reason for the dismissal.

[43] In the proceedings before me, the respondent maintained that the applicant had abandoned his employment when he did not return to work after his approved leave expired. It was also said that the applicant had failed to communicate with the respondent during the period of leave or to make appropriate enquiries as to whether the request for personal/carer’s leave had been approved. There were also assertions made about the applicant’s unsatisfactory performance and activities which were said to be contrary to his obligations and duties as an employee of the respondent.

[44] In the final written submissions made after the completion of the hearings, the respondent submitted that if the Commission found that the applicant had not abandoned his employment then the Commission should find that the applicant was guilty of gross and serious misconduct which provided a basis for the respondent dismissing him without notice. In this regard, it was said that the applicant personally caused serious risk and actual damage to the reputation, viability and profitability of the respondent’s business.

[45] Despite the array of sometimes conflicting submissions and assertions by the respondent, the veracity of which is almost impossible to determine in the absence of evidence being presented in support, it would seem to me that the probable explanation for the dismissal was as follows. The applicant made a request for personal/carer’s leave which the respondent believed it did not have to approve. The respondent took the view that if the applicant did not return to work at the end of his approved leave on 3 January 2014, it was entitled to act on the basis that he had abandoned his employment. The respondent did not inform the applicant that his employment was at risk should he fail to return to work after that leave and did not notify the applicant on 6 January that his employment had come to an end. The applicant only became aware of the respondent’s position when he returned to work on 16 January. This is the simple explanation and interpretation of the events and circumstances surrounding the termination of the applicant’s employment.

[46] The main reason for the termination of employment would therefore seem to be the failure of the applicant to return to work after his approved annual leave had ended. This was connected with the assertion by the respondent that the applicant was not entitled to take personal/carer’s leave in the circumstances of his wife’s hospitalisation and in order to provide the primary care for his other children. A misunderstanding of the relevant legislative provisions relating to the taking of personal/carer’s leave may have been the reason for the approach adopted by the respondent. In this regard, it was asserted by Mr Wallace that there had been advice given to the respondent by the Fair Work Ombudsman’s office. However, no evidence was led regarding the advice received or the basis upon which any such advice might have been given. It was simply asserted in submissions that such advice had been received and was acted upon by the respondent. However this may be, as set out above, I do not consider that there was a sound basis for the respondent to take the approach it did in relation to the applicant’s request for personal/carer’s leave or that it was reasonable in the circumstances to take that approach.

[47] It may be added that there are a variety of other possible reasons for the dismissal which might be suggested, including an endeavour by the respondent to avoid its responsibilities in relation to providing personal/carer’s leave to the applicant in circumstances where Mr Wallace disapproved of the applicant having any more children. 28 Such a reason would no doubt be considered to be “capricious, fanciful, spiteful or prejudiced”. However it is not necessary for me to venture into the realms of such possibilities because, as stated above, there is a simple and plausible interpretation of the circumstances and events which led to the dismissal.

[48] Although in the course of the proceedings and subsequent e-mails the respondent put forward a range of other reasons which were said would justify the termination of the applicant’s employment, these reasons have the hallmark of an endeavour, after the event and after the unfair dismissal application was made, to bolster a case by making assertions and complaints about the applicant and his work performance. It is noted that some of these matters were put to the applicant during cross-examination by Mr Wallace. However I am not persuaded on the basis of that evidence that there is any significant substance in the assertions and complaints made. Further it is noted that no evidence was presented in support of the other explanations for the termination of the applicant’s employment. Despite indications before the hearings that the respondent would present evidence from several witnesses, the only evidence led was that from Mr Kerr, the respondent’s bookkeeper, who had limited knowledge and responsibility in terms of the employment and supervision of the applicant.

[49] I consider that the failure of the applicant to return to work on 6 January 2014 did not provide a “sound, defensible or well founded” reason for his dismissal. I would reach this conclusion irrespective of whether the applicant was entitled to be granted a period of personal/carer’s leave by the respondent. The respondent was aware of the circumstances surrounding the applicant’s leave and his inability to attend work since early November 2013 as a result of hospitalisation of his wife and newborn baby. The respondent was also aware of the request for personal leave and the advice from the hospital that the applicant’s wife was likely to need hospitalisation until 29 January 2014. The respondent did not contact the applicant to enquire about his return date or to encourage an early return to work. Although the failure by an employee to return to work after a period of leave may provide a valid reason for dismissal, in my view it did not in the circumstances of the present case.

[50] Accordingly I find that, in the circumstances of this case, the applicant’s return to work some 10 days after the completion of his annual leave did not provide a valid reason for dismissal.

s.387(b) Notice of reason

[51] The applicant was not notified of the reason or reasons for his dismissal before the dismissal took effect. The respondent maintained that the applicant had abandoned his employment and that this was the reason that the employment relationship had come to an end. In the course of the proceedings it was submitted by the respondent that there were other reasons which justified the termination of the applicant’s employment. However it was not submitted that these reasons were notified to the applicant prior to the decision to terminate his employment. 29

s.387(c) Opportunity to respond

[52] The applicant was not given an opportunity to respond to the accusation that he had abandoned his employment by failing to return to work in early January 2014. In a series of e-mails on 16 and 17 January 2014 and in a telephone conversation between Mr Wallace and the applicant on 17 January 30 the applicant was advised that he had abandoned his job. There is no evidence that the respondent took into account the applicant’s position that he had not abandoned his employment or that the reason for his absence from work related to his family problems and/or the reliance on his request for personal/carer’s leave.

s.387(d) Support person

[53] There was no scheduled meeting in person or by telephone to discuss the termination of the applicant’s employment. The communications between the parties and the advice from the respondent consisted mainly of e-mails sent by Mr Wallace. Given the circumstances, it is understandable that the applicant did not seek the involvement of a support person.

s.387(e) Warning about unsatisfactory performance

[54] There is some material before the Commission regarding matters raised with the applicant regarding unsatisfactory performance. 31 However, as concluded above, I am not satisfied that the dismissal related to unsatisfactory performance by the applicant. To the extent that the respondent had complaints regarding the lack of communications from the applicant during the period of approved leave, there is no evidence that these complaints were conveyed to the applicant or were the subject of any warnings given to him.

s.387(f) and (g) Procedures followed

[55] The respondent is a small employer 32 and would not seem to have procedures in place for the proper investigation and determination of issues relating to the conduct and performance of employees. The respondent does not employ any human resources specialist or expertise and it would seem that the responsibilities regarding the supervision of staff are performed by the respondent’s CEO and director, Mr Wallace. It is evident from the facts of the present case that the absence of such expertise has had an adverse impact on the procedures followed in relation to the dismissal of the applicant.

s.387(h) Other matters

[56] There are a range of additional matters which the applicant submitted are relevant to be taken into account in considering whether the dismissal was harsh, unjust or unreasonable. It was submitted that the dismissal in all the circumstances was disproportionate to any conduct on the applicant’s part and having regard to the very difficult situation that the applicant found himself in having to assume primary care for his four children while his wife was in hospital. It was also submitted that the dismissal was harsh because of the applicant’s financial circumstances.

[57] It was submitted that the termination of the applicant’s employment was harsh or unreasonable having regard to these matters and the fact that the applicant was given no prior notice of the respondent’s intention or decision to end his employment.

[58] These are considerations which may be taken into account in making an overall assessment as to whether the applicant’s dismissal was unfair.

Conclusion

[59] Having considered all the above matters, I have come to the conclusion that the dismissal of the applicant was harsh, unjust or unreasonable.

[60] In the circumstances of this matter, the failure of the applicant to return to work until some 10 days after his accrued annual leave had run out did not provide a valid reason for dismissal. The respondent was aware of the reasons for the applicant’s absence and was also aware of the request for a period of personal/carer’s leave whilst his wife and newborn baby were hospitalised in Sydney. I find that the termination of the applicant’s employment by the respondent in such circumstances was harsh. I also find that the dismissal was unreasonable as the applicant was given no prior notice by the respondent that it would treat him as having abandoned his employment if he did not return to work soon after 3 January. It was also unreasonable because it would seem that the applicant was entitled to take some of his accrued personal/carer’s leave in the circumstances, had this entitlement not been denied by the respondent. Further, the failure of the respondent to provide a proper opportunity for the applicant to answer or to respond to the allegations and complaints made against him also supports a finding that the dismissal was unfair.

[61] Even if it was to be found that the failure of the applicant to return to work immediately after his approved leave did provide a valid reason for dismissal, I consider that the other considerations referred to above would support a conclusion that the applicant’s dismissal was unfair.

[62] Having regard to all the relevant factors referred to in s.387, I have come to the conclusion that the termination of the applicant’s employment was harsh, unjust or unreasonable.

[63] I now turn to consider the appropriate remedy in this matter. The applicant has sought compensation.

(iii) What is the appropriate remedy?

[64] The remedies for unfair dismissal are referred to in s.390 of the Act. Section 390(3) provides that the Commission may order compensation only if it is satisfied that reinstatement is inappropriate and that compensation is appropriate in all the circumstances of the case. The subsection is in the following terms:

“(3) The FWC must not order the payment of compensation to the person unless:

(a) the FWC is satisfied that reinstatement of the person is inappropriate; and

(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.”

[65] In considering an appropriate remedy in a case of unfair dismissal, regard must also be had to the legislative object set out in s.381 of the Act. This includes an emphasis on the remedy of reinstatement (s.381(1)(c)) and on ensuring that a “fair go all round” is accorded to both the employer and employee concerned (s.381(2)).

[66] It was submitted by the applicant that reinstatement would be an inappropriate remedy given the breakdown in the employment relationship.

[67] In all the circumstances of the present matter, I have decided that reinstatement is not the appropriate remedy and that an order for the payment of compensation should be made. This is because of the breakdown in the employment relationship as evidenced both in the numerous e-mails sent to the applicant by Mr Wallace and in the conduct of the parties in the proceedings. Although there were some suggestions in the early stages of the proceedings that the respondent might be willing to reinstate the applicant, these suggestions run counter to the case presented by the respondent and the numerous complaints made regarding the applicant’s performance and commitment in the course of the proceedings.

[68] I now turn to the question of compensation.

[69] Subsection 392(2) provides that the Commission must take into account all the circumstances of the case, including the factors set out in the subsection, in determining the amount of compensation to be ordered in lieu of reinstatement. The subsection provides:

“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.”

[70] In determining the amount of compensation in the present matter, I note that there were virtually no submissions by the respondent in relation to the issue of the calculation of any appropriate compensation.

[71] I note that the applicant was employed for about five and a half years by the respondent (s.392(2)(b)) and was receiving a salary of approximately $55,000 per annum. There is no reliable evidence or material before me as to the effect that any order of compensation would have on the viability of the respondent’s enterprise. It is noted that the respondent is a small enterprise and was given the opportunity to make submissions in relation to the determination of the unfair dismissal application. However no substantive submission has been made that an order of compensation would have an adverse impact on the viability of the respondent’s enterprise (s.392(2)(a)). I have also considered the remuneration of the applicant would have received if he had not been dismissed (s.392(2)(c)). I accept that the applicant wanted to continue in the service of the respondent. However I also recognise that there were issues in relation to his work performance and that the applicant had other sources of income. Although I have reservations as to the extent to which the complaints and allegations about the applicant’s performance raised in submissions by the respondent should be relied upon, I do not accept that the employment of the applicant would have been likely to continue well into the future.

[72] In relation to mitigation, the applicant has continued to perform some work for InfiNet Wireless and has received some income in relation to that work since the termination of his employment (s.392(2)(d) and (e)). The applicant has also been in receipt of a disability pension of $635 per fortnight. He has also received approximately $7400 in commission payments from BGWT Technologies Group and approximately $783 from Altai Technologies (HK). In relation to the payments from InfiNet Wireless, it was explained that since 2008 the applicant has been appointed as a regional sales manager and has received commission payments for sales from InfiNet Wireless in addition to his salary with the respondent. It is also relevant to note that the applicant advised the Commission that he has been diagnosed as having cancer of the spine and would be undertaking radiotherapy five days a week for about seven and a half weeks from mid-August 2014. It is therefore unlikely that he will earn any additional income in this period or in the possible recovery period after such treatment (s.392(2)(f)).

[73] There are several other matters which are relevant in determining the amount of compensation in this case (s.392(2)(g)). These include the possibility that the applicant would have been entitled to the use or pay out of accrued annual leave had the respondent allowed him to take personal/carer’s leave during his wife’s hospitalisation and that the applicant, if he had continued in the respondent’s employment, would have been entitled to use his accrued personal leave in relation to his medical treatment. 33 It is also noted that the applicant lives in a relatively remote area and that this, together with his family responsibilities, may mean that it will be difficult for him to find other suitable employment in the area.

[74] Section 392(3) requires the Commission to reduce the amount of compensation by an appropriate amount if it is satisfied that the misconduct of a person contributed to the employer’s decision to dismiss the person. In the present matter, for the reasons given above and despite the assertions made in the submissions of the respondent, I do not consider that there has been shown to be any proven misconduct by the applicant which should be taken into account in reducing the amount of compensation otherwise to be awarded.

[75] I have considered all the above matters in reaching a conclusion as to the amount of compensation to be ordered in the present case in lieu of reinstatement. In particular I have noted the period of service of the applicant and the prospects of future employment. I have also taken into account the income received by the applicant since the termination of his employment with the respondent, with the exception of that received from InfiNet Wireless.

[76] Having regard to all the circumstances of the case, and taking into account the matters referred to in s.392 of the Act, I have determined that the amount of compensation should be 20 weeks’ pay. I note that this does not exceed the compensation cap in s.392(5). The 20 weeks’ pay should be calculated in accordance with s.392(6).

Conclusions and order

[77] For all the reasons given, I have decided that the dismissal of the applicant by the respondent was harsh, unjust or unreasonable and that the appropriate remedy is that an order should be made for the payment of compensation to the applicant in the amount of twenty weeks’ pay. An order to this effect will be made.

SENIOR DEPUTY PRESIDENT

Appearances:

V Maroulis, solicitor, appeared on behalf of the applicant.

P Wallace appeared on behalf of the respondent.

Hearing details:

2014:

Sydney.

August 6 and 12.

Final written submissions:

Applicant:

27 August 2014.

Respondent:

29 August 2014.

 1   Exhibit M1.

 2   Exhibit W1.

 3   This included the making of representations and submissions to the Commission, other than in accordance with the directions issued, through a series of e-mails some of which were not copied by the respondent to the applicant or his solicitor.

 4   See Transcript at PN 859-862, 878-879.

 5   The applicant described his position as “senior field engineer”. The respondent submitted that the applicant was employed as a salesman and that his ancillary role could best be described as “field technician”.

 6   See e.g. the e-mail sent by Mr Wallace on 16 January 2014 at 10:48pm, especially the first three paragraphs.

 7   Exhibit M2.

 8   Exhibit M1.

 9   Exhibit W2.

 10   Exhibit W1.

 11   See Transcript at PN92-94; PN231-258; PN426-427; PN441-446; and PN497.

 12   See the consideration of somewhat similar circumstances by the Federal Circuit Court in Wilkie v National Storage Operations Pty Ltd [2013] FCCA 1056 especially at [52] - [59] per Judge Whelan.

 13   See s.107 of the Act. It is noted that in subsequent submissions it was put by the respondent that the applicant never claimed to have attempted to provide notice about personal/carer’s leave to Mr Wallace until after 16 January 2014 (see Application submitted on an interlocutory basis by the respondent dated 20 August 2014). This contradicts the evidence given in the proceedings by Mr Kerr to the effect that the letter sent by the applicant on 12 December 2013 regarding personal/carer’s leave was forwarded to Mr Wallace (see Transcript PN 930-953). The applicant received no response from the respondent to the letter and was not requested by the respondent to provide evidence in accordance with s.107(3).

 14   E.g. regarding domestic violence complaints and claims that the applicant had misled the Commission or perjured himself in his testimony: see Application submitted on an interlocutory basis by the respondent dated 20 August 2014; and e-mail dated 23 August 2014.

 15   See statement of David Johnston Exhibit M1 Annexure A. The Company ID on the payslip is for The Trustee for The MTGI Trust.

 16   The submission by the respondent made in an e-mail dated 23 August 2014 that the applicant was guilty of serious misconduct is dealt with later in this decision. The submission was not linked to the Small Business Fair Dismissal Code and was not supported by any evidence presented in the proceedings.

 17   Exhibit W2 at p.3.

 18 (1995) 62 IR 200

 19   Ibid at 205-206.

 20   See Mosey v Australian Custom Services [2002] AIRC 879 at [38] - [39], and O’Meara v Stanley Works Pty Ltd [2006] AIRC 496 at [23].

 21 (1995) 62 IR 371 at 373

 22   See also Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137 at 144; Annetta v Ansett Australia (2000) 98 IR 233 at 235; Bo Vu v State of Victoria (2001) 110 IR 383 at [80]; Potter v WorkCover Corporation (2004) 133 IR 458 at [14]; Rail Corp (NSW) v Vrettos (2008) 176 IR 129 at [51].

 23   Lawrence v Coal & Allied Mining Services Pty Ltd T/A Mt Thorley Operations/Warkworth (2010) 202 IR 388 at [13].

 24   Coal & Allied Mining Services Pty Ltd v Lawler (2011) 207 IR 177 at [4] per Cowdroy J (with whom Marshall J agreed).

 25   Qantas Airways Ltd v Cornwall (1998) 83 IR 102 at 106; Rail Corp (NSW) v Vrettos (2008) 176 IR 129 at [51].

 26   Windsor Smith Ltd v Liu (Giudice J, Polites SDP and Gay C, Print Q3462, 13 July 1998); Smith v Moore Paragon Australia Pty Ltd (2004) 130 IR 446 at [45]; Rail Corp (NSW) v El Hawat (2006) 156 IR 385 at [25].

 27   Barclay v Nylex Corporation Pty Ltd (2003) 126 IR 294 at [278] - [280].

 28   See e-mail from Mr Wallace to the applicant dated 16 January 2014 (attached to the Form F2 Unfair Dismissal Application).

 29   See Crozier, above n22.

 30   See Witness Statement of David Johnston Exhibit M1 at para 37.

 31   See Witness Statement of David Johnston Exhibit M1at paras 16 and 26.

 32   The evidence of Mr Kerr is that it had only two employees, the applicant and himself: see Transcript PN 1008-1017.

 33   It would seem that the applicant had an entitlement to over 275 hours of personal leave as at 6 January 2014 (see Exhibit M3, Applicant’s Outline of Submissions in Reply, 21 July 2014, para 1.3)

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