Dean Alexiou v Emporio Constructions

[2015] FWC 4139

[2015] FWC 4139

FAIR WORK COMMISSION

DECISION

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

Dean Alexiou
v
Emporio Constructions
(U2014/15770)

COMMISSIONER WILSON MELBOURNE, 19 JUNE 2015

Application for Unfair Dismissal Remedy.

[1] Dean Alexiou was employed by Nicholas Stagias, trading as Emporio Constructions, on 11 November 2013. He was employed as a mature aged apprentice, subject to a contract of training for an apprenticeship in carpentry.

[2] The training contract as entered into between Mr Alexiou and Emporio Constructions commenced on 11 November 2013 with the contract itself being signed on 21 November 2013. Mr Alexiou gave evidence to the effect that he had commenced work a week earlier than 11 November on a trial arrangement which then became an offer of an apprenticeship. The training contract refers to the term of the training contract being 48 months with a probation period of three months. The trading name of the employer on the training contract is Emporio Constructions, with the legal name of the employer and contact person both being referred to as Nicholas Stagias.

[3] The original hearing Directions in this matter were issued on 29 April 2015. At that time the Respondent was represented by a lawyer, who ceased to act for the Respondent on 26 May. On 29 May 2015 the hearing date was amended to 15 June 2015.

[4] Correspondence was sent by my Chambers to the Respondent on 9 June 2015 drawing to the attention of the Respondent the importance of the proceedings to commence on 15 June 2015, advising Mr Stagias that he should attend the Fair Work Commission on this date and to seek legal advice or advice from a person experienced in industrial relations about the matter. The correspondence also advised that, notwithstanding this advice, and as a courtesy to the Commission and Mr Alexiou, if it was the Respondent’s intention not to attend the hearing, Mr Stagias was requested to provide in writing his advice that he did not propose to attend.

[5] No correspondence has been received from Mr Stagias or any other person acting for or on behalf of Emporio Constructions. Further to this correspondence, my Associate endeavoured to contact Mr Stagias on the morning of 15 June 2015, being the date of the hearing in this matter, for the purposes of ascertaining whether Mr Stagias intended to attend the hearing, however no contact was able to be made with Mr Stagias. Further, no submissions or other evidence has been filed for or on behalf of Mr Stagias.

[6] Because of these circumstances I considered it to be fair and proper to proceed with the hearing of Mr Alexiou’s application in the absence of the Respondent.

[7] The only person who gave evidence in relation to this matter was the Applicant himself, Mr Alexiou. I find his evidence truthful and capable of being relied upon. The evidence that I have taken into account includes Mr Alexiou’s oral evidence, together with a number of documents that were tabled in the course of the proceeding and also the other material within the file of this matter, including the originating application.

[8] For reason of the circumstances set out below, I find that Mr Alexiou was dismissed within the meaning of the Fair Work Act 2009 (the Act), with the dismissal being on 19 November 2014.

[9] Section 396 of the Act requires the determination of four initial matters to be considered before considering the merits of the application and I make the following findings in relation to those initial matters;

• Mr Alexiou’s application for an unfair dismissal remedy was filed in the Fair Work Commission on 8 December 2014, which is within a 21 day period from the date of dismissal. As a result, I find that Mr Alexiou’s application was made within the 21-day period required in s.394(2)(a).



• The evidence also allows, and I find, that Mr Alexiou was at the time of his dismissal a “person protected from unfair dismissal” within the meaning of that expression in s.382.



• Mr Alexiou gave evidence that he, together with four other apprentices, was one of about five people employed by Mr Stagias. For that reason I find that the evidence supports that Mr Stagias is a “small business employer” within the meaning of that expression in s.23 of the Act. However there is no evidence before me that would support a contention that Mr Alexiou’s dismissal was consistent with the Small Business Fair Dismissal Code, and I find it was not.



• I find, that Mr Alexiou’s dismissal was not a case of “genuine redundancy” as defined in s.389 of the Act.

BACKGROUND

[10] As referred to above, Mr Alexiou was employed as a mature age apprentice to perform work for Mr Stagias through his business Emporio Constructions. The evidence given by Mr Alexiou is that Emporio Constructions is not an incorporated entity and that instead Mr Stagias undertakes the work of the business as a sole trader.

[11] The work of Emporio Constructions is to undertake carpentry in the home building sector.

[12] Mr Alexiou had not previously worked as a carpenter, however after being engaged by Mr Stagias spent his time working on home building sites along with other tradespeople, including those of other firms.

[13] The evidence discloses that at first the working relationship between Mr Alexiou and Mr Stagias appears to have been amicable enough. The relationship appears to have degenerated close to April 2014, at which time Mr Alexiou noticed irregularities, including unauthorised deductions from his wages, which he queried with Mr Stagias after taking advice from the Fair Work Ombudsman (the FWO). Those queries appear not to have entirely resolved the situation.

[14] Mr Alexiou’s application indicates that the reason he understands to be the predominant reason for his dismissal was an enquiry he made to Mr Stagias about his pay and other entitlements, and such was corroborated by the evidence provided at the hearing.

[15] By early November 2014 Mr Alexiou had become significantly concerned about the payments he was receiving and whether they conformed with the entitlements he understood he had under the relevant modern award, referred to in his submissions as being the Building and Construction General On-Site Award 2010. The evidence discloses that Mr Alexiou had made extensive enquiries with the Fair Work Ombudsman about his entitlements and what could be done about them. The FWO advisor he had spoken to encouraged him to raise the subject of the alleged underpayments with his employer and had given him information about how to go about doing that.

[16] Also by early November 2014, Mr Alexiou became very concerned as to whether Emporio Constructions was properly insured under Victorian workers’ compensation legislation. He made some enquiries about the subject and his evidence is that he found that the business was not so insured. Part of Mr Alexiou’s concern was that he was working on building sites which, by their nature, can be hazardous and that he was concerned that should he incur an injury, he would not be entitled to the full amount of compensation.

[17] Mr Alexiou’s evidence is that he raised these matters with Mr Stagias in a series of exchanges that took place on 5 November 2014. The first part of this exchange related to the status of Emporio Constructions’ workers compensation coverage, with Mr Stagias putting back to Mr Alexiou information about a cover note, which Mr Alexiou disbelieved. Mr Alexiou’s evidence is that he had had it confirmed to him by a person involved in the Victorian workers compensation system that the information Mr Stagias had put to him related to a cover note that had only recently been taken out by Mr Stagias and which Mr Alexiou believed had no, or insufficient, effect.

[18] Mr Alexiou’s evidence is that he challenged Mr Stagias about this and that in the same exchanges he also referred to the need for Mr Stagias to rectify the underpayments. Mr Alexiou’s evidence in this regard is supported by a series of text messages provided to the Commission.

[19] The exchanges referred to above took place over an extended period of time on 5 November 2014. Early on that day, at about 8:51 AM, according to Mr Alexiou’s text messages, he had notified Mr Stagias that in the absence of certainty about there being workers’ compensation coverage, Mr Alexiou was going home, apparently not wanting to risk being injured at work without, in his mind, being insured. When he informed Mr Stagias about this, Mr Stagias’ response was to say that Mr Alexiou would be unpaid if he went home.

[20] Mr Alexiou’s evidence also includes a verbatim telephone exchange with Mr Stagias in the course of 5 November 2014, which proceeded in the following way;

“Nick calls me “screaming What the fuck is going on” ? What is your problem?

I replied “You have no work cover we are on scaffolds 3 levels up if I hurt myself or one of the other boys what happens then”?

Nick replies “ Have you hurt yourself?

I replied “No I havnt” (sic)

Nick Replied “ Then what the fucks your problem?

I replied “ As I said to you yesterday I need to get paid correctly I need to get my superannuation up to date and having no Work Cover is so wrong You expect us to work in these conditions.

Nick Replied “ Get the Fuck off the site, You have no job, You are no good, You are unable to do your job properly, you are no good for me and you’re wasting my time…

I replied “ You are a real Pig, how dare you speak to me like that.

He replied “ for all the things I’ve done for you this is what I get, giving you a job and this is what I get.

Nick then tells me to Fuck off and hangs up the phone.”

[21] The next day, on 6 November 2014, and subsequently on 10 November 2014, Mr Alexiou consulted a medical practitioner who certified that Mr Alexiou was receiving medical treatment and was unfit for work initially between 5 and 7 November 2014 and then between 10 and 11 November 2014. Mr Alexiou puts this forward as a reason for him not being able to attend work on those dates.

[22] The text messages provided by Mr Alexiou also disclose that on 6 November 2014 he was informed by a representative from the apprenticeship broker he had been using, Jobs Plus, who told him that Mr Stagias had told the broker that Mr Alexiou had quit. Having received that information, Mr Alexiou sent a further text message to Mr Stagias challenging the proposition he had quit saying that “I never said I quit and I don’t plan to. I am on sick leave at the moment, I will be back at work on Monday”.

[23] Mr Alexiou reiterated this to Mr Stagias on 13 November and sought information about when he could return to work. Mr Alexiou’s text message says the following;

“Afternoon nick

As per my text you on 6th November I have not resigned nor will I

Still waiting for your call to tell to go to work or if you are letting me go in both cases you should pay me out on my entitlements as far as I am concerned you are still paying me. If I don’t hear back from you in the next two days to which way you are intending to go with my position as 2nd year apprentice I assume you have dismissed me and will be taking you to court for unfair dismissal…”

[24] On or around 6 November 2014, Mr Alexiou sent to Mr Stagias a letter concerning the pay irregularities he had experienced. The letter advised that he believed he had been underpaid since the commencement of his employment with Emporio Constructions from 11 November 2013 to the date of the correspondence. The letter discloses Mr Alexiou’s belief that he had been underpaid in five respects, namely;

• A shortfall of the minimum hourly rate;



• Shortfall payment of overtime;



• Failure to pay leave loading;



• Unpaid employee superannuation contribution payments;



• Reimbursement of school expenses.

[25] Mr Alexiou’s correspondence to Mr Stagias shows that he had been assisted by a named person from the customer solutions team at the Fair Work Ombudsman who advised that his employment was covered by the Building and Construction General On-Site Award.

[26] Mr Alexiou’s correspondence to Mr Stagias indicated that he believed he had been paid $13.20 per hour based on a 40 hour week compared with the rate that should have been paid to him in the period after 1 July 2014, which for a mature aged apprentice was, according to Mr Alexiou, $19.44 per hour (and, he says, $17.33 per hour in the period before 1 July 2014). The correspondence goes into further detail about what is said to be the underpayment and invites Mr Stagias to investigate the issues raised in the letter and to discuss what is set out within it, as well as to make contact with the Fair Work Ombudsman advisor. The correspondence provides both the advisors telephone number and also a Fair Work Ombudsman reference number for future contact.

[27] Altogether the letter is professional, well written and polite.

[28] Mr Alexiou says that he never heard back from Mr Stagias and that in any event it was told to him by Jobs Plus that he had been deemed to have resigned. Mr Alexiou’s evidence is that he finally had it confirmed to him on 19 November by Jobs Plus that their conversations with Mr Stagias showed his employment was deemed to have ended.

[29] I am satisfied from the evidence provided in this matter that the circumstances in which Mr Alexiou found himself was a dismissal, within the meaning of s.386 of the Act.

[30] At no time did Mr Alexiou evince an intention to resign from his employment, and the evidence to the contrary is that he held himself out to be available for work in accordance with his contract of employment, the obligations of the Fair Work Act and Victorian workers’ compensation legislation, all of which may be regarded as uncontroversial and normal obligations in respect of the employment of a mature age apprentice. In finding that there was a dismissal I take into account the evidence given to me by Mr Alexiou about the relatively abusive conduct of Mr Stagias on 5 November 2014 and view that conduct as showing an intention on the part of Mr Stagias to terminate the contract of employment.

LEGISLATION

[31] The legislative provisions which are relevant to this matter are set out in s.387 of the Fair Work Act 2009 (the Act), which is 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.

CONSIDERATION

[32] In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account the legislative factors set out earlier.

(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)

[33] The evidence supports that there is no valid reason for Mr Alexiou’s dismissal related to his capacity or conduct, including its effect on the safety and welfare of other employees.

[34] The evidence instead supports that the reason for Mr Alexiou’s dismissal was that he personally queried with Mr Stagias whether he was being paid correctly, together with an invitation that he discuss the complaint with the Fair Work Ombudsman; and that he also queried whether Emporio Constructions had workers compensation insurance.

[35] These are legitimate enquiries for an employee to make and indeed, in the sense that they may be a complaint about a workplace right, are protections afforded to every employee by the Fair Work Act 2009.

[36] Merely raising these matters with one’s employer and seeking a discussion and resolution on the subject cannot amount to a valid reason for dismissal. There is no evidence before me that would suggest that Mr Alexiou raised these queries or complaints in anything but an appropriate and measured manner.

[37] I find therefore that there was no valid reason for Mr Alexiou’s dismissal.

(b) whether the person was notified of that reason

[38] I take into account that Mr Alexiou was not directly informed by Mr Stagias that he was dismissed. Instead he learned from the apprenticeship broker, Jobs Plus, that he was deemed to have resigned from employment, which is not supported by the facts of this matter.

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person;

[39] For the reason that Mr Alexiou was not aware of his termination until after it took effect, he had no opportunity to respond to such reasons as might be held by Mr Stagias for his dismissal.

[40] I note, however, that in relation to the criterion of whether an employee has been given an opportunity to respond to the reason for dismissal, strictly speaking such consideration by the Commission is consequential to a finding there is a valid reason for dismissal, which I have not found. 1

(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;

[41] Consideration of this criterion does not arise since there was no direct discussion about Mr Alexiou’s dismissal.

(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

[42] Consideration of this criterion does not arise since there had been no prior discussion with Mr Alexiou about his work performance.

(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

[43] The evidence discloses that Emporio Constructions is a small firm. Mr Alexiou’s evidence is that Mr Stagias employed him and 4 other apprentices and that there were no other employees within the firm.

[44] As a result, I am satisfied that the size of the employer’s enterprise has likely impacted upon the decision to terminate Mr Alexiou’s employment, and the way in which it was implemented.

(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;

[45] For the same reason as referred to above, namely the size of Emporio Constructions, and in the absence of any evidence to the contrary about the extent to which the firm may have access to persons with human resource management expertise, I find that the absence of that expertise most likely impacted on the decision making of the Respondent.

(h) any other matters that the FWC considers relevant.

[46] In the course of giving evidence, Mr Alexiou referred to an important practical difficulty which applies to him, as a mature age apprentice.

[47] His evidence is that, having been dismissed, the apprenticeship authority will not release him to be available for other apprenticeship opportunities until his unfair dismissal application before the Fair Work Commission has concluded.

[48] It is reasonable to take into account that such eventuality would be known to Emporio Constructions, as the engager of several apprentices. Overall, this makes the effect of a dismissal of an apprentice more harsh than would otherwise be the case, for the reason that further employment as an apprentice cannot be obtained until the resolution of any unfair dismissal application, which may be many months after dismissal, and almost 7 months in Mr Alexiou’s case.

[49] Having considered all the evidence in this matter and taking into account the statutory criteria referred to above, I am satisfied that Mr Alexiou’s dismissal was in all the circumstances harsh, unjust and unreasonable.

REMEDY

[50] The sections of the Act dealing with remedy once a finding of unfair dismissal has been made are as follows;

390 When the FWC may order remedy for unfair dismissal

(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of compensation to a person, if:

(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and

(b) the person has been unfairly dismissed (see Division 3).

(2) The FWC may make the order only if the person has made an application under section 394.

(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.

Note: Division 5 deals with procedural matters such as applications for remedies.

391 Remedy—reinstatement etc.

Reinstatement

(1) An order for a person’s reinstatement must be an order that the person’s employer at the time of the dismissal reinstate the person by:

(a) reappointing the person to the position in which the person was employed immediately before the dismissal; or

(b) appointing the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.

(1A) If:

(a) the position in which the person was employed immediately before the dismissal is no longer a position with the person’s employer at the time of the dismissal; and

(b) that position, or an equivalent position, is a position with an associated entity of the employer;

the order under subsection (1) may be an order to the associated entity to:

(c) appoint the person to the position in which the person was employed immediately before the dismissal; or

(d) appoint the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.

Order to maintain continuity

(2) If the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC considers appropriate to maintain the following:

(a) the continuity of the person’s employment;

(b) the period of the person’s continuous service with the employer, or (if subsection (1A) applies) the associated entity.

Order to restore lost pay

(3) If the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC considers appropriate to cause the employer to pay to the person an amount for the remuneration lost, or likely to have been lost, by the person because of the dismissal.

(4) In determining an amount for the purposes of an order under subsection (3), the FWC must take into account:

(a) 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 reinstatement; and

(b) the amount of any remuneration reasonably likely to be so earned by the person during the period between the making of the order for reinstatement and the actual reinstatement.

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), 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.

Misconduct reduces amount

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

[51] Pursuant to s.390(3) of the Act, an order for the payment of compensation to a person must not be made unless the Fair Work Commission “is satisfied that reinstatement of a person is inappropriate” and also that the Commission “considers an order for payment of compensation is appropriate in all the circumstances of the case.”

[52] Mr Alexiou submits that in all the circumstances it would be inappropriate to reinstate him. He submits that the prospect of reinstatement has passed given the passage of time between the date of termination and today. He also submits that he would not want to be reinstated even if that was available to him.

[53] I am satisfied in all the circumstances that it would be inappropriate to reinstate Mr Alexiou and that instead I should give consideration to an order for the payment of compensation. I now turn to each of the relevant criterion provided in s.392(2) of the Act.

(a) the effect of the order on the viability of the employer’s enterprise

[54] There is nothing before me which would indicate that an order of compensation in and of itself will negatively affect the viability of the employer’s enterprise.

(b) the length of the person’s service with the employer

[55] Mr Alexiou’s employment with Mr Stagias was for a period of slightly over one year.

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed

[56] In matters in which compensation is a consideration, the Commission ordinarily makes an assessment of remuneration the employee lost through dismissal, which in turn requires a finding in relation to “anticipated period of employment”. The Full Bench of the Australian Industrial Relations Commission has observed the following in relation to these matters;

[33] The first step in this process - the assessment of remuneration lost - is a necessary element in determining an amount to be ordered in lieu of reinstatement. Such an assessment is often difficult, but it must be done. As the Full Bench observed in Sprigg:

". . . we acknowledge that there is a speculative element involved in all such assessments. We believe it is a necessary step by virtue of the requirement of s.170CH(7)(c). We accept that assessment of relative likelihoods is integral to most assessments of compensation or damages in courts of law."

[34] Lost remuneration is usually calculated by estimating how long the employee would have remained in the relevant employment but for the termination of their employment. We refer to this period as the "anticipated period of employment". This amount is then reduced by deducting monies earned since termination. Only monies earned during the period from termination until the end of the "anticipated period of employment" are deducted. An example may assist to illustrate the approach to be taken.”  2 (endnotes omitted)

[57] As a mature aged carpentry apprentice, Mr Alexiou reasonably could have expected that his employment with Emporio Constructions would continue for some time. The training contract entered into with Emporio Constructions commenced on 11 November 2013 and was not due to be completed for 48 months from the start of the contract. At the time that he was dismissed, there was effectively another three years to run on the contract.

[58] One of the restrictions on an employee in entering into a training contract for an apprenticeship is what Mr Alexiou found having been dismissed – that he cannot easily move into another apprenticeship without the necessary release having been given by the apprenticeship authorities. On the other hand, one of the restrictions for an employer is that an apprentice may not be easily dispensed with either.

[59] This consideration leads to the view that Mr Alexiou’s employment with Emporio Constructions would have continued for some considerable time, and especially so in the absence of any performance related warnings. Whereas the material before the Commission indicates that Mr Stagias was critical of Mr Alexiou’s performance, there is no material other than the related conversations that would support such criticism.

[60] To the contrary, Mr Alexiou brought forward evidence in the form of a certificate from his TAFE provider, the NMIT, indicating he had been awarded a certificate in November 2014 for the “Best First-Year Apprentice – Carpentry”.

[61] I consider therefore that Mr Alexiou’s anticipated period of employment with Emporio Constructions would have been not less than 12 months. I will proceed to assess compensation on the basis of an anticipated period of employment of 12 months.

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal

[62] Mr Alexiou submits that he has endeavoured to obtain other employment, both as an apprentice and otherwise. His evidence indicated placing his name forward to a recruitment agency and making other applications.

(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

[63] Mr Alexiou’s evidence indicated that he had been successful in obtaining employment for a period of about four months, for which he says he was paid approximately $800 per week. He agrees that this is a period of about 16 weeks. A deduction for these amounts will be made from the amount ordered for compensation.

(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

[64] There is no evidence before me in this regard, since at the time of the hearing Mr Alexiou indicated that he was not employed.

[65] I find the compensation I propose does not need to be adjusted to take account of income he might receive between the making of the order for compensation and the actual compensation.

(g) any other matter that the FWC considers relevant.

[66] I take into account that as a mature age apprentice, Mr Alexiou is presently 45 years of age. His evidence reported some difficulties in obtaining employment because of his age. I also take into account the difficulty, referred to above, that Mr Alexiou has had with the apprenticeship authorities in not being able to easily move his contract of training to another employer.

[67] There is no evidence before me that would require a deduction from compensation for misconduct (s.392(3)).

CONCLUSION AND ORDERS

[68] After consideration of the foregoing issues, I find that the Applicant was dismissed and that it was unfair within the meaning of the Act.

[69] I find that reinstatement is not an appropriate remedy in this case.

[70] I find that compensation is appropriate.

[71] It is first necessary to calculate the total remuneration Mr Alexiou was entitled to receive. In Mr Alexiou’s case the payments he actually received are unreliable for the purposes of that calculation for the reason that there was a contest between he and Mr Stagias about whether there had been underpayments. Noting that the criterion within s.392(2)(c) refers to an assessment of “the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed” and the provision dealing with the calculation of the compensation cap, s.392(6)(a), referring to the total amount of remuneration “to which the person was entitled”, I consider it appropriate in all the circumstances to base the calculation of compensation to Mr Alexiou on the payments to which he was entitled.

[72] I consider the following elements should be taken into account in assessing the remuneration to which Mr Alexiou was entitled;

• Weekly award rate – The evidence discloses that Mr Alexiou’s employment was subject to the Building and Construction General On-Site Award 2010. The Fair Work Ombudsman’s PACT tool calculates weekly pay rates, including an industry allowance, of $738.58 per week, which is the rate I will use here, noting that in evidence Mr Alexiou put forward an hourly rate of $19.44;



• Tool allowance – The same award prescribes a tool allowance payment for a person employed in Mr Alexiou’s capacity, however the same FWO tool referred to above incorporates that allowance within the hourly rate mentioned above, and so I do not include that amount separately in my calculation of remuneration;



• Superannuation guarantee – The percentage rate applicable under the superannuation guarantee since 1 July 2014 is 9.5%, with that rate being applied to ordinary time earnings, not only in respect of the weekly rate of pay, but also in respect of allowances, including the tool allowance. The percentage would not be applied to the mature age apprentice incentive payment referred to below. I assess the superannuation guarantee payment to which Mr Alexiou would be entitled is $70.17 per week.



• Mature age apprentice incentive payment – Mr Alexiou gave evidence that being a mature age apprentice he was entitled to a payment from the Victorian State Government of $150 per week which was intended to be compensation for the difference between the rates of pay of a mature age apprentice, based as Mr Alexiou submitted upon a labourers wage, and rates that would usually be expected to go to a skilled adult. I consider that this amount should be included in my order for compensation for the reason that it could have ordinarily been expected to be paid to Mr Alexiou into the future, with him giving evidence that it would not reduce until after completion of his second year an apprentice.

[73] In summary, I find that Mr Alexiou’s entitlement was to weekly remuneration of $888.58 and superannuation of $70.17 per week.

[74] The approach by the Fair Work Commission in these matters, and which I follow here, is to estimate the remuneration the employee would have received if they had not been dismissed (usually calculated by estimating how long the employee would have remained in the relevant employment but for the termination of their employment); deduct any remuneration earned by the employee since their dismissal until the end of the anticipated period of employment; deduct an amount for contingencies; consider the impact of taxation and adjust the figure accordingly; and assess the figure against the compensation cap set by s.392(5). 3

[75] The Full Bench in Haigh v Bradken Resources Pty Ltd 4 has recently clarified the assessment of compensation and connected issues that require dealing with, including the deductions of amounts for misconduct, and consideration of the compensation cap. So far as is relevant to this matter, the Full Bench found;

[10] The frequently quoted case on compensation calculations is Sprigg v Paul Licensed Festival Supermarket in which a Full Bench of the Australian Industrial Relations Commission (AIRC) confirmed the following steps in determining compensation under the unfair dismissal provisions of the Workplace Relations Act:

“1. Estimate the amount the employee would have received or would have been likely to receive if the employment had not been terminated,

2. Deduct monies earned since termination,

3. Deductions for contingencies,

4. Calculate any impact of taxation,

5. Apply the legislative cap.”

[76] In relation to the matter of contingencies, I consider it appropriate to make a deduction of 10% for the contingency that the Applicant may not have served the whole of the remaining 3 years as an employee of Emporio Constructions, or for reasons such as ill health, lawful termination by the Respondent, voluntary resignation, or closure of the Respondent’s business. 5

[77] In relation to taxation, I will settle a gross amount and leave taxation for determination. 6

[78] Having regard to the considerations established by s.392 of the Act, and the criteria established by the FWC, I find that compensation should comprise a payment by the Respondent to the Applicant calculated as follows:

Assessment of remuneration lost:	52 weeks projected lost income at the weekly rate of $888.58 (being the base rate of $738.58 per week and the State Government incentive payment of $150.00 per week)	$46,206
Employer superannuation contribution on above	9.5% (on base rate only)	+ $3,649
LESS:	Monies earned since dismissal 16 weeks pay at the rate of $800 per week	- $12,800
LESS:	Contingencies - 10% of remuneration lost and superannuation	- $4,986
TOTAL	$32,069

[79] The above amount exceeds the “compensation cap” applying at the time of dismissal, which I must determine in accordance with the provisions of s.392(5) and the related formula set out in s.392(6), referred to above.

[80] In Mr Alexiou’s case, I have calculated the compensation cap as $22,703. The calculation of the cap comprises 21 weeks at the rates of pay applying after 1 July 2014, when there was an adjustment for an annual wage review and a further 5 weeks at a lower weekly rate and tool allowance. Mr Alexiou’s evidence puts the pre-July 2014 hourly rate at $17.33 per hour, which is the rate I use in the calculation below, for reason that an alternative accurate hourly rate is not available to me in the evidence or from the FWO tool. Both components have had applied to them the relevant superannuation guarantee percentage, which also changed on 1 July 2014. The calculation is as follows;

before 1 July 2014		after 1 July 2014
Base rate & tool allowance	$17.33 per hour	$658.54	$19.44 per hour	$738.58
State Govt incentive	$150.00	$150.00
Sub-total	$888.58
Superannuation on base & tool allowance	9.25%	$60.91	9.50%	$70.17
Total remuneration	$869.45	$958.75
5 weeks at $869.45 (rounded)		$4,347
21 weeks at $958.75 (rounded)		$20,134
Compensation cap	$24,481

[81] For reason of s.392(5) and (6), the most that can be awarded as compensation to Mr Alexiou is the amount of $24,481.

[82] An order requiring Nicholas Stagias, trading as Emporio Constructions, to pay to Mr Alexiou the total amount of $24,481, taxed according to law, is issued in conjunction with this decision.

[83] In accordance with this decision, $21,904, less taxation, is to be paid directly to Mr Alexiou, and $2,577 is to be paid to his superannuation account.

COMMISSIONER

Appearances:

Mr D Alexiou on his own behalf

Hearing details:

2015.

Melbourne:

15 July

 1   Chubb Security Australia Pty Ltd v Thomas (2000), Print S2679, at [41].

 2   Ellawala v Australian Postal Corporation, AIRCFB (2000), Print S5109, at [33] and [34].

 3   See Sprigg v Paul’s Licensed Festival Supermarket (1998) 88 IR 21, 32, and Ellawala v Australian Postal Corporation (2000) Print S5109 [33]

 4   [2014] FWCFB 236

 5   Slifka v J W Sanders Pty Ltd (1995) 67 IR 316, p.328; Ellawala v Australia Post Corporation [2000] AIRC 1151, Print S5109, at [41] - 43]

 6   Bowden v Ottrey Homes[2013] FWCFB 431, at [55]

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