Deborah Brackenreg v Men's Legal Service Ltd - [2024] FWC 1770

[2024] FWC 1770

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Deborah Brackenreg
v

Men’s Legal Service Ltd

(U2024/2818)

COMMISSIONER RIORDAN

SYDNEY, 22 AUGUST 2024

Application for an unfair dismissal remedy

On 12 March 2024, Ms Deborah Brackenreg (the Applicant) filed an application with the Fair Work Commission (the Commission) seeking a remedy for an alleged unfair dismissal pursuant to section 394 of the Fair Work Act 2009 (the FW Act). The Applicant was employed by Men’s Legal Service Ltd (the Respondent) as a Solicitor from 23 November 2020 until the date of her dismissal on 25 February 2024.

In its Form F3 – Employer Response, the Respondent raised a jurisdictional objection to the application on the basis that it is a small business employer and had complied with the Small Business Fair Dismissal Code (the Code).

Background

Following a meeting between Mr James Stokes, Director of the Respondent, and the Applicant on 24 January 2024, the Applicant was stood down with pay by the Respondent on 4 February 2024, pending the outcome of an investigation into her conduct.

The Applicant was issued a Notice to Show Cause Letter on 12 February 2024, which provided:

“Dear Deborah,

Notice to Show Cause
I have commenced an investigation into your conduct following our discussion on 24 January 2024. Since that time, 2 other serious matters have been brought to my attention that have precipitated further investigation.
As these were serious and fundamental issues going to the heart of your obligations to the firm and professional duties, and as they presented in the context of your apparent significant distress, the firm directed you to take annual leave in accordance with the terms of your employment agreement for the week commencing 29 February 2024. This was also deemed necessary to provide “clear air” for senior practitioners to review the file on which you indicated you had lost control and were not prepared for court the following week.

You were notified on 4 February 2024 that an investigation was to be undertaken and that you would be stood down on full pay for that process. You were directed not to contact any clients or staff other than myself, Nan Naidoo and Miranda Campbell.
This correspondence and process comes following a substantial number of formal and informal warnings as to your conduct and the following of directions and policies of the firm.
Alleged Serious Misconduct – Misallocation of Financial Reporting to Obtain a Benefit
In the course of the conversation with you on 29 January 2023 you admitted to me that you have “given your time” to Mark Clare in an effort to make his billings “look better, so he would receive a pay rise”.

It is noted that:

1.Your time performance for November and December were substantially below that required under both your contract of employment and compared to performance in the preceding 12 months; and
2.Mr Clare did in fact cite his financial performance (that could on be described as ‘sound’ over the preceding two months) in support of and to obtain a commitment for a substantial increase in salary in December 2023.

“Padding” or “gaming” timesheets in any way is expressly prohibited by our policy “Expectations of Fee Earners” reviewed with you on your first week with us and since. You are also aware enough to know that behaviour that falls below the standard of a legal practitioner and, in law.
This is a serious matter. A finding that you have acted with dishonesty to obtain a financial benefit – even where that benefit is indirect or for an other person – is cause to terminate your employment in accordance with, inter alia, your employment agreement.
This situation also reflects a constant concern with your failure to record your time on files and to follow directions with respect to pro bono work. This is further manifest by your lack of recorded productivity when you have indicated that the lawyer under your supervision and you have been working long hours. A review of your files in the course of this investigation indicates a pronounced and systemic underbilling of substantial work. You have also continued to work and received dsicpline (sic) for failure to follow directions to cease work for clients who have refused to pay the firm for existing fees.
The context of our call on 24 January was that you were following us up on the replacement of Mark. We have taken a number of steps (including some that you have been invited to take for a number of years), however these issues cause us to reconsider the appropriateness of placing junior staff under your supervision given the disrespect you demonstrate to the firm and your colleagues.

We are not a funded government organisation and the above behaviours, and others we have reviewed over time, impact your fellow colleagues and me personally.
This allegation is one of serious misconduct following increasing issues in relation to following directions in relation to and meeting financial obligations to the firm.
Alleged Misconduct – Contacting Staff Other Than Directed During Investigation
On 5 February 2024 you were directed not to contact any staff other than James Stokes, Nan Naidoo and Miranda Campbell.
You subsequently contacted Sajan Naker to claim sick leave for the preceding week retrospectively.
It is alleged that you breached the terms of the directions given to you with respect to the investigation underway.
While this may seem like a minor matter, you have been repeatedly counselled to follow direction, policies and procedure with respect to, inter alia, the conduct of matters, briefing of counsel, ceasing to act on matters, recording of time and office hours.
Alleged Serious Misconduct – Failure of Duties to the Client and Court
On 29 January 2024 you spoke with me and other members of the board about the conduct of the file for (rather than identifying the case, the matter will be referred to as the ‘W File’ throughout this Decision). You indicated that you were not prepared for trial and that the Court had been dealing unreasonably with you.
I confirm that you were asked to stand down on Monday 29 January 2023 after this call and after exhibiting some concerning behaviours on 24 January 2024.
In the meantime, given that a final hearing of the [W file] matter was due to occur on 5 February 2024, the file has been reviewed. We are extremely concerned about the way that this file has been managed by you.

1.You have had carriage of the [W file] from 13 September 2022 and a Final Hearing was due to occur on 5 and 6 February 2024. You filed a certificate of readiness in this matter on 11 July 2023 indicating that we were ready to proceed to a trial.
2.You had been aware of your obligations to complete Court documents for a final hearing since 3 October 2023. Upon reviewing your file on 29 January 2024, it is apparent that you have not complied with Court Orders and our client was not ready for a trial.
3.Your conduct in this matter has put our client and our firm at risk of a cost order being made against us. [The client in the W file] has also disclosed information that suggests that you procured medical reports to avoid going to trail (when the matter has been protracted and it is in the interests of the client to resolve the matter finally) and other matters of professional concern. The Court has ordered the disclosure of related correspondence and expressed its concern as to the circumstances surrounding the matter, certifying counsel’s resulting costs in preparation for an adverse costs order.
4.You have billed [the client in the W file] $67,000 to date filing incorrect and vexatious applications and responses that have been costly for the client and embarrassing for the firm.
5.The final orders sort in the matter are woefully insufficient –

“That there be an overall percentage division of the net assets of the parties as to 50%/50% shared equally between the parties” [sic]

This conduct, which you demonstrated with your declaration to us in your telephone call of 24 January that you were not “an incompetent practitioner” constitutes gross misconduct. It has brought the firm into disrepute, it has breached your undertaking to the Court and duties to the client, it has resulted in the breach of Court orders that have resulted in costs being incurred unnecessarily by the parties to the matter.
This conduct has caused your colleagues – who have had to rectify the matter with a report claiming that the client “was unable to give instructions” (per your wording to the relevant practitioner) – a great deal of stress, fatigue and loss of faith in you. This has also greatly impacted our ability to complete tasks on their own matters.
Your actions here fall well below the policies and procedures of the firm, your duties as a practitioner and your obligation to the firm and client.
Alleged Serious Misconduct – Falsely Claiming Personal Leave
Following the providing of notice that an investigation had been commenced, you sent to Sajan Naker and James Stokes the following correspondence via email –

…
From: Deborah Brackenreg [email redacted]
Sent: Monday, February 5, 2024 2:40 PM
To: James Stokes [email redacted]; Sajan Naker [email redacted]
Subject: Leave
Dear James and Sajan
I had a medical certificate to email
You which I appear to have lostt which is for all of last week. I have asked For a replacement certificate which I will Forward as as soon as I have received it
[SIC]
…

Further emails confirmed that you were alleging that the personal leave due to sickness extended to the whole week.
No certificate has been received. It is alleged that you have falsely claimed an entitlement for which you were not due on receipt of the notice of investigation into your conduct. You have also contacted a staff member outside of the express direction given to you not to contact a staff member other than James Stokes, Nan Naidoo and Miranda Campbell.
Alleged Serious Misconduct – Failure to Record Court Dates as Directed
On 1 February 2024 Mark Clare admitted to James Stokes in a telephone call that you and he had not recorded the court dates into the firm’s practice management systems and files in the manner required by the firms processes and procedures.
Mr Stokes reviewed these requirements with you in December when he visited with you and Mr Clare. These requirements, together with a direction that all Court dates and bringups be properly recorded in the firm’s practice management system, was reiterated at a training session in January 2024.
Mr Clare indicated that “Deborah and I just do it our way on our own calendar” and that there has been no effort at all to implement the express direction given by Mr Stokes and the firm.
Your failure to follow this direction has exacerbated the risks to the firm of your conduct in a situation where you were placed on urgent leave. It has greatly hindered the determination and rectification of the firm’s obligations on these files and exacerbated the stress and angst caused to members of the firm who have attempted to triage your files following your failure to manage them.
This also demonstrates a remarkable personal contempt for Mr Stokes, who has left his own practice to travel to and conduct this training for the firm in December.
Our concerns

The effected members of staff and the board is greatly concerned by the admission above, the conduct of the [W file] and other matters and the constant indicators that you do not wish to comply with the firm’s policies or directives.
You have been put on notice several times in the past that should you continue to conduct yourself inappropriately you would be disciplined.
These actions fall well below that expected of you as a member of the firm, a legal practitioner and an officer of the Court.
Next Steps
If cause is not shown as to why you should continue your employment with the firm, your employment will be terminated for misconduct in accordance with the terms of your employment agreement with the firm.

You are required to show cause as to why your employment should not be terminated by 5pm 15 February 2024.
If your employment is not terminated, we will require at a minimum that you remedy the attitudes and behaviours that lead to this situation, attitudes and actions. It is likely that you will experience at a minimum a period of significant and rigorous mentoring and performance management.
Yours Sincerely,
James Stokes
Legal Practitioner Director”

(My emphasis)

On 15 February 2024, Mr Stokes wrote to Ms Marcelle Webster of MLW Legal Pty Ltd, the Applicant’s former representative, as follows:

“Dear Ms Webster,
Deborah Brackenreg – Notice to Show Cause
We refer to your email of earlier today, which we presume refers to Ms Deborah Brackenreg.
Background
The Show Cause notice, which you have to hand, adequately sets out the background to this matter.
Leave and Medical Certificates
In relation to the medical certificate, we add that:

1.When prompted as to the period for which the ‘misplaced’ certificate related that your client responded, “The week”.
2.Your client was provided notice on 4 February 2024 (not “29 January 2024”) as follows:

“Good evening Deborah,
Unfortunately, we are going to need to conduct an investigation into a number of matters that may have serious disciplinary consequences, including and having in some respects been brought to a head by the conduct of the [W file] matter.
You are stood down with pay pending the outcome until at least Friday. Correspondence will be provided shortly.
You are not to contact any staff other than via myself, Nan and Miranda or any clients in the meantime. You are directed not to contact clients or utilise the firm’s systems other than for informing any matter you are asked to provide a response to. [emphasis added]

Please confirm the best email to send the correspondence.
Kind regards, James.”

3.Your client finally provided a medical certificate on 15 February 2024, after receiving the Show Cause Notice earlier that day. The medical certificate stating that your client, “has a medical condition and will be unfit for work from 29/01/2024 to 23/02/2024 inclusive.”
4.For a combination of reasons which are readily apparent on the facts, we do not consider that “notice of the purported lease (sic) was provided as soon as practicable” as required by section 107 of the Fair Work Act 2009 (Cth).

Given:

1.The matters that give rise to the show cause notice pertain to the likely misuse of medical reports procured for to serve your client’s ends;
2.The timing of the provision of the notice follows the Show Cause notice;

3.The period does not align with the period advised by your client was provided for on the “misplaced notice”;

4.The fact that this is the third client represented by your firm who, when confronted with disciplinary matters, produced medical certificates in similar circumstances and with issues similar to the above,

we must raise with you our concern that this is not valid or effective for the purposes tendered and request further information with respect to this alleged certificate.

Your client is invited to provide substantiation of the purported medical certificate and to disprove the reasonable concerns to which these facts give rise.
However, we note that while relevant to the Show Cause Notice, the provision or otherwise of this substantiation will not impact your client’s entitlements given your client has exhausted all personal leave entitlements.

Professional matters
We have received today a short text message from your client that appears that it may have been intended to be sent to your office. We have deleted the text message.
We note that:

1. Ms Brackenreg is the third member of our firm for whom you have acted;
2. Each employee for which you have acted has, immediately on the commencement of disciplinary action, produced medical certificates declaring them unfit for work for a period of 4 weeks or more with issues similar or the same as those above.

3. Both prior employees have filed complaints with the Legal Services Commission for ‘bullying’. Neither have resulted in any disciplinary action at all and one complaint has resulted in, as we understand it, your client becoming subject of an investigation by the Legal Services Commission themselves.

4. You have previously been cautioned, formally and most recently on 12 January 2022, with respect to corresponding (with no reason that we can see) with non-legal employees of our firm.

5. You have, for no reason and in breach of the Solicitors Conduct Rules, sent correspondence today to non-executive, non-legal practitioner directors of our firm. You are once again cautioned with respect to the propriety of doing so.

While we are usually hesitant to raise matters of ethical concern in this way these issues are naturally relevant to the facts of your client’s matter. Your client is also a legal practitioner and is able to both assess these concerns and is entitled to appreciate that they may result in adverse inferences being drawn that impacts the disciplinary process they are subject to by association.

Requested Extension of Show Cause
We note that you have requested an extension of 3 business days after the date on which your client “is authorised and able to login to the Actionstep software.”

We note that:

1.Your client has at all times been able to access the Actionstep software;
2.Your client was specifically told this and invited to refer to the firm’s systems “for informing any matter you are asked to provide a response to” as set out above.

Accordingly, your request is not necessary, noting that your client has been aware of this investigation since at least 4 February 2024.

However, we note that:

1.We have determined that your client retains confidential information of client data on her personal phone, notwithstanding the direction that staff do not utilise their own phones to contact clients;
2.Your client has been in communication with clients of the firm (again, in violation of the direction given to her during the period of the investigation); and

3.A client of your firm has yesterday provided a file transfer request from Mr Poed. We note that Mr Poed is one of the above clients of your firm and that this client was not at the firm when Mr Poed was employed.

It appears that your client is breaching both the obligations of her employment agreement and professional obligations. Your client’s access to the firm’s practice management system has today been suspended as a result.
Your client’s access will be reinstated on provision of an undertaking that:

1.Your client will cease and disclose all communications to date with clients and other law firms which may result in or evidence breaches of her employment agreement;
2.Your client does not and will not retain any client data, including telephone numbers for clients with whom your client did not have a personal relationship with prior to their engagement with our firm; and

3.Your client undertakes to utilise the firm’s management systems for the sole purpose of responding to the Show Cause Notice.

We also note that the Show Cause Notice identifies matters of serious misconduct, at both law and as defined in your client’s employment agreement with the firm and that no period of any length is required, your client being liable to summary dismissal on the information already available to us.
Ample opportunity to respond has been provided out of an abundance of courtesy and fairness to your client and the length of her service, as has informal opportunities to discuss the concerns as requested by your client.
However, we agree to extend the period in which your client may respond to the show cause notice without prior action to 9am 21 February 2024. No extension for your client’s delay in providing the above undertaking will be granted. For completeness, as your client has asserted she is unfit for work and has no accrued personal leave, your client will not be paid for the period of this extension.

Your client is reminded of her obligations with respect to the preservation of material which is discoverable in potential proceedings.

We reserve our rights.

Yours Sincerely,

James Stokes
Legal Practitioner Director”

(My emphasis)

Mr Stokes further wrote to Ms Webster on 20 February 2024, raising an additional allegation against the Applicant as follows:

“Dear Ms Webster

I am letting you know that I have just received a credible report from one of the directors of the firm that your client yelled at a practitioner on the other side of our [W file] matter … and, inter alia, used the profanity “c*nt”. This is alleged to have been overheard by three practitioners in both offices.
I let you know this as a courtesy to you and to your client, as you can appreciate that, having come to my attention today, there is a high likelihood of a finding that serious misconduct has been committed by your client – putting aside the other matters that have prompted our recent investigation.
My strong preference was not to refer to this conduct in open correspondence for the sake of your client. However, I appreciate that it is a matter to which your client may appreciate the opportunity to respond. Your client is welcome to respond as she may see fit or is advised. If it occurred, it is in our view conduct that is completely counter to the policies and practices of our firm and Ms Brackenreg’s responsibilities as a legal practitioner.
I am letting you know as a courtesy that if I form a view and am satisfied on the balance of probabilities that this incident occurred then I expect that your client’s employment will be terminated in accordance with the terms of her employment at the expiration of the extended timeframe provided by last week’s correspondence, which is extended again until 5pm tomorrow 21 February 2024.
Kind regards,
James Stokes
Legal Practitioner Director”

(My emphasis)

The Applicant provided a Response to the Show Cause Letter on 21 February 2024, which stated:

“Dear Mr Stokes,

RE: NOTICE TO SHOW CAUSE
I refer to your letter dated 12 February 2024 (“the Notice to Show Cause”) containing number of allegations (“the Allegations”). I take the Allegations seriously and my response to each of the Allegations is set out below.

Allegation 1 – Misallocation of Financial Reporting to Obtain a Benefit
The Notice to Show Cause states that “padding” or “gaming” timesheets in any way is expressly prohibited by our policy “Expectations of Fee Earners”
It is alleged that:

1.In the course of a conversation with you on 29 January 2023, I admitted to you that I have “given my time” to Mark Clare in an effort to make his billings “look better so he would receive a pay rise”;
2.My time performance for November and December was substantially below that required under both my contract of employment and compared to performance in the preceding 12 months;
3.Mr Clare did in fact cite his financial performance in support of and to obtain a commitment for a substantial increase in salary in December 2023;

I did “give my time” to Mark Clare on numerous occasions but I deny that I informed you that it was for the purpose of making him look better so he would receive a pay rise – as it was not.
Mark’s employment at Men’s Legal Service was Mark’s first job after he finished his law degree. He had never worked at a law firm previously and had no experience in working at a law firm.
As Mark had no prior experience in working in a law firm, I spent a considerable amount of my time training him. I reviewed all his work which included emails, letters court documents and advice provided to clients and I would estimate that I sat in on 90% of all consultations.
On many occasions when I was training Mark I gave my time to Mark (ie. I did not bill for my time) because I did not think that it was appropriate to do so given that Mark was undertaking the legal work and my involvement was simply for the purpose of training Mark. On the other hand there were occasions in which I felt that my involvement was more than simply for the purpose of training Mark (where we were both undertaking legal work) and I did think it was appropriate for both of us to bill for time on a matter (and we both did).
November/December time performance

I admit that my time performance was less in November/December 2023 compared to performance in the preceding 12 months for several reasons, including:

1. I had a computer issue which required weekly calls to Levit8 (MLS computer assistance firm) for assistance and this took several hours of my time each week and involved me wiping the computer and then reloading all its programs and providing control of my computer over to Levit8.
I did find that the computer issues did take up a lot of time that I even advised the Practice Manager, Sajan Naker (PM) that I thought the computer itself was on the way out and I asked if we could look at the possibility of getting a new computer as a matter of urgency. The Operations Manager, Bree and Mr Naker arranged a new computer for me to carry out work on however that was not a quick process and took approximately 2 months as it took Levit8 approximately 2/3 weeks to finalize the transfer of all files and allow me full access to the computer. Then once I had access to the computer there were further issues that Levit8 needed to resolve as it could not print or scan and I was also unable to bill on Actionstep.
2. Our office (including me) was directed to stop working on files and I was not allowed to talk to clients or appear in court etc. because apparently our professional liability insurance was not paid. It took about a week before we were told we could start working again.

3. In November/December 2023 I did have health issues that were being addressed which I had made Mr Naker aware of at the time.
In particular, I broke my patella in June 2023 getting lunch which required hospitalization (overnight). I was unable to walk/ drive without a frame as could not use crutches (previous shoulder injury). I hired a carer briefly to assist in the home, but I relied on friends and MC. I was in a brace and used a walker.
In November/December 2023 I was seeing a physio for rehabilitation in respect of my patella injury and I was also seeing the dentist weekly for root canal treatment and endodontist treatment (which remains ongoing).
I am aware that padding or gaming timesheets is prohibited by our policy.
I deny padding or gaming my timesheets and for the reasons stated above, I was certainly not padding or gaming Mark’s timesheet nor was I acting dishonestly in any way to obtain a financial benefit for myself or Mark.
Allegation 2 – Contacting Staff other than directed during investigation
It is alleged that I breached the terms of the directions given to me with respect to the investigation.
Namely:
1.On 5 February 2024 I was directed not to contact any staff other than James Stokes, Nan Naidoo and Miranda Campbell; and
2.I subsequently contacted Sajan Naker to claim sick leave for the preceding week retrospectively.

I admit that I sent an email on 5 February 2024 and 12 February 2024 to Mr Naker because:
1.Mr Naker handles pay and leave; and
2.I emailed him on 5 February 2024 and 12 February 2024 in respect of sick leave.

My emails to Mr Naker were limited to sick leave – as he is the manager that I am required to contact in respect of sick leave.
Allegation 3 – Failure of Duties to the Client and Court
It is alleged that insofar as the [W file]:
1.I filed a certificate of readiness in this matter on 11 July 2023;
2.I did not comply with Court Orders and our client was not ready for a trial;
3.[The client in the W file] has also disclose (sic) information that suggests that I procured medical reports to avoid going to trial and other matters of professional concern. The Court has ordered the disclosure of related correspondence and expressed its concern as to the circumstances surrounding the matter, certifying counsel’s resulting costs in preparation for an adverse costs order;
4.I billed [the client in the W file] $67,000 to date filing incorrect and vexatious applications and responses that have been costly for the client and embarrassing for the firm; and
5.The final orders sort in the matter are woefully insufficient.

This matter is a very complicated property matter. I did not handle this matter from the start. This matter was handed to me by Cameron Martin (a senior employee at Men’s Legal Service) when he was going on leave. When Mr Martin returned from leave he refused to take the file back off me. During the time that this matter has been running, due to staff turnover there have been more than 6 lawyers at Men’s Legal Service that have had responsibility for running this file.
Because this matter is complicated, shortly after being involved in this matter, with permission from James Stokes, I engaged Mr Marbury Chambers of Counsel (Counsel) to assist with this matter.
I recall that the Certificate of Readiness was filed months previously when the client was well.
I recall that paralegals were working on court documents for the trial in accordance with Counsel’s instructions.
I recall that the client was not well leading up to trial and for that reason, paralegals prepared another application in a proceeding to vacate the trial until the client could give instructions and submitted to several medical procedures (in respect of issues with her throat as she could speak for only short periods). The application was lodged by paralegals on 16 January 2024 (my first day back at work after illness).
On my return to work, I had not spoken to [the client in the W file] and did not know about her difficulties but I recall reading the application that was lodged by paralegals and discussed next steps with Counsel who provided me with advice about procuring medical evidence and to delay trial as a matter of urgency.
I deny that I procured medical reports to avoid going to trial – I had obtained medical reports for the purpose of the application to adjourn trial.
I deny that I filed any incorrect and vexatious applications and responses. Importantly, Counsel was retained on this matter and before I lodged any application on this matter either myself or Mark always checked with Counsel and acted on her advice.
In respect of the final orders sought – I deny what is alleged because it is not true. The final orders sought were detailed in the amended response to Initiating Application that was filed on 12 July 2023 – a copy of that amended response appears on pages 9 to 24 of Annexure A to this response.
Again, I reiterate that Counsel was engaged on this matter and the orders sought in the amended application were settled by Counsel.
In light of the above, I deny that I have acted unprofessionally in this matter.
Allegation 4 – Falsely claiming personal leave
It is alleged that I have falsely claimed an entitlement to sick leave for which I was not due on receipt of the notice of investigation into my conduct.
I deny this allegation because it is not true.
My treating doctor is [Dr Martin] at the Territory Medical Centre. I had an appointment and did see [Dr Martin] on 29 January 2024 and he did provide me with a medical certificate that day which certifies me as being unfit for work in the period 21 January 2024 to 2 February 2024.
When I returned home from the Territory Medical Centre I could not find the medical certificate that [Dr Martin] had provided me. I did look everywhere for it but I must have misplaced it or lost it on the way home.
I had to wait until Monday 5 February 2024 before I could see [Dr Martin]. When I saw [Dr Martin] again he issued me with another medical certificate certifying me as unfit for work in the period 29 January 2024 to 23 February 2024. I emailed that medical certificate to Mr Naker that day.
After receiving the Notice to Show Cause, I contacted the Territory Medical Centre and asked if there was any chance that they had a copy of the medical certificate that [Dr Martin] provided me on 29 January 2024. They did provide me with a copy of that medical certificate on 16 February 2024.
A copy of that medical certificate which I received from [Dr Martin] on 5 February 2024 (and I provided to Mr Naker) appears on page 1 of Annexure A to this response.
A copy of the medical certificate which I received from [Dr Martin] on 29 January 2024 which I had lost but which the Territory Medical Centre provided me with a copy of it on 16 February 2024 appears on page 2 of Annexure A to this response.
I provided a medical certificate to Mr Naker as soon as I could in respect of sick leave.
Under no circumstances have I falsely claimed an entitlement as that is not true. I did see my doctor and he did issue me with the certificates referred to above.
Allegation 5 – Failure to record court dates as directed
It is alleged that:
1.I had not recorded the court dates into the firm’s practice management systems and files in the manner required by the firms processes and procedures.
2.Mr Stokes reviewed these requirements with me in December 2023 and they were reiterated at a training session in January 2024.

I do not recall a training session in January 2024 that I attended in respect of recording court dates.
Firstly, all court dates have always been recorded in both me and Mark into our diaries and our “To Do List” which is a daily running sheet of tasks required on each file and the work needed to be done. At the time of recording dates they are also sent to the client.
A copy of the To Do List I have referred to appears on pages 3 to 16 of Annexure A to this response.
I am unable to provide a copy of my Microsoft calendar although that will also show that dates were recorded in my calendar also.
I was not made aware of the requirement to record dates in Actionstep nor did I know how to do that until Mr Stokes visited us in December 2023 and showed Mark and I how to do that. As December 2023 was extremely busy and we also moved into the Darwin office, we did not have sufficient time to move the dates from the To Do List over into Actionstep in December 2023.
However, Mark subsequently recorded all court and mediation dates on Actionstep.
Without access to Actionstep I cannot print screenshots of the matters to establish that the court and medication (sic) dates are recorded in Actionstep. As Mr Stokes informed me how to record dates in Actionstep, I am now able to do so and will do so moving forwards.
Allegation 6 – Inappropriate language
It is also alleged that I yelled at a practitioner on the other side of our [W file] matter … and, inter alia, used the profanity “c*nt”.
I deny this allegation as it is not true.
Under no circumstance would I ever use that profanity when speaking to a practitioner or any other person.
It is not in my nature to act in that way, and, I certainly would never say that word.
ADDITIONAL COMMENTS
We have on occasions struggled due to staff turnover and it is true that workload can be stressful at times without sufficient support.
Nevertheless, I take great pride in my position and work as solicitor of the team at Men’s Legal Service.
I remain committed to working as an effective member of the team and look forward to continuing to work for Men’s Legal Service.
I look forward to receiving your response as soon as possible.
Yours faithfully
Deborah Brackenreg”
(My emphasis)

The Respondent served a Termination Letter on the Applicant on 25 February 2024:

“25 February 2024
…
Dear Deborah
Termination of your employment
I am writing to you about the termination of your employment with Men’s Legal Service.
This outcome arises and is considered unavoidable following significant and wilful misconduct as outlined in the notice to show cause dated 12 February 2024 and raised via your solicitor on 15 February 2024 and 20 February 2024. These include the following incidents:

1.   Your misallocation of financial time to obtain a financial benefit.
It is our finding that you did, dishonestly and contrary to the policies of the firm, “game” the financial reporting obligations you have to the firm in order to obtain a financial benefit for Mark Clare, being a substantial payrise and yourself indirectly by the continued employment of Mr Clare.
Your explanation provide in the response to the show cause notice is not accepted as:
(a)   You deny the natural meaning of the words and express conversation you had with our Mr Stokes, which Mr Stokes diarised and commenced a written warning immediately upon completion of the call;
(b)   The other matters outlined in your response to the show cause notice are either not relevant or did not occur during the relevant time period; and
(c)   It is our view that on all information available to us that you acted as alleged.

2.   Your failure to follow the direction given during the investigation.
We note that you did contact Mr Naker contrary to the direction.
Further, there is significant evidence that you communicated with clients of the firm contrary to this same direction and directed them to another former employee of the firm.
3.   Failure of Duties to the Client and the Court
Your response seeks to avoid responsibility for the conduct of the matter by reference to lawyers that previously had conduct of the matter (nearly a year ago) and to the “paralegals” and “counsel”. As the lawyer with carriage of the matter, you are and were strictly responsible for the conduct of the matter.
The response does not address why court orders were not complied with nor why you twice signed off on certificates of readiness for trial.
It is noted that your denial of the insufficiency of the orders sought you have produced are those prepared and filed by the applicant’s solicitor – ie the other side. These only serve to illustrate the insufficiency of the single line of orders filed by yourself.
An examination of the file by the lawyers who have been forced to face the Court in the context of your efforts to avoid trial and the reports procured by yourself to that end has deeply sickened these practitioners and placed them in an untenable professional position due to your actions.
It is our view on the information available that you acted as alleged.
4.   Falsely Claiming Personal Leave
We note that:
(a)   You have provided a response to this allegation including a second medical certificate also dated 29 January 2024, but which provides for a different time period;
(b)   You have admitted that the certificate for the period 29 February 2024 to 23 February 2024 was in fact issued on 5 February 2024 (and not 29 February 2024 as it states);
(c)   The medical certificate that stated you as unfit for work on 29 January purports to relate to the period 21 January 2024 to 2 February 2024. However, it is dated from 29 January 2024 to 2 February 2024, which is in conflict with your representations to Mr Naker that it was “for the week.”
(d)   It is unclear why both medical certificates are dated 29 January 2024 and yet refer to different periods.

In other words, neither certificate produced is consistent with your application.
We also note that you have engaged a firm whose clients undergoing discipline action inevitably appear to produce medical certificates for periods of 4 weeks and an immediate first action. This is circumstantial, but gives rise to a reasonable concern as to the legitimacy of these certificates.
It is our view on the information available that you acted as alleged.
5. Failure to record court dates as directed
You admit that you were directed how to record court dates by Mr Stokes on 8 December 2023. Mr Stokes records that he directed that this occur by the end of the month.
This direction was repeated in a practice management meeting and the process reviewed in depth in January 2024.

Mr Clare indicated to Mr Stokes in February that neither of you had recorded the dates as directed “because Deb and I keep our dates on our calendar.” Mr Clare did not indicate that he had not had time, only that he and you had decided that you would maintain the dates in another way.
The form provided to us of your to do list is not in the form required by the firm and is not a sufficient recording of the dates, as they are not visible on the electronic file.
You did not move into the Darwin office in December or January. This and the other reasons given for failure to follow this direction are disingenuous.
Mr Clare only recorded the dates later in his notice period after Mr Stokes spoke firmly to him about the requirement and impressed on him that ignoring a direction of this nature was improper and counselling him to give serious consideration to compliance with directions and file hygiene at his next place of employment. This was not driven by any penitence or compliance on your part.
It is our view on the information available that you acted as alleged.
6. Inappropriate language and yelling at opposing practitioner
We have discussed this allegation seeking further particulars and substantiation from the practitioner involved and confirmed with two other practitioners in that office. Not only do they confirm the language and yelling at the practitioner, they indicate that you also accused him of “gouging” his client (we note that his fees are substantially less than yours for the same period).
It is our view on the information available that you acted as alleged.
7. Additional comments
Your additional comments are offensive and demonstrate a lack of contrition and judgment for your actions. These give rise to a reasonable apprehension that if you are allowed to continue that you will continue to act as you have done.
It is also telling that you have claimed, in the course of this investigation that you have been deprived of access to the files (when you have not) and that you have declined to provide an undertaking as to the correct use of the firm’s confidential information. The firm has a reasonable apprehension that you have and intend to breach your obligations to the firm with respect to its clients and confidential information.
Further serious concerns have arisen during the course of the investigation and show cause period.
It is also apparent that you, contrary to your representations to our Mr Stokes, referred Mr Tran to MLW Lawyers, in breach of your fiduciary duties to the firm, which resulted in a vexatious complaint to the Legal Services Commission. It is noted that during the course of Mr Tran’s employment that you actively hid from Mr Stokes Mr Tran’s inability to function in the role to which he was hired.
We note that you have been counselled and warned in the course of your employment with respect to your conduct and the “us and them” mentality that you have adopted towards the other members of the firm and its board. These behaviours and attitudes have culminated in the behaviours above and demonstrate that your employment at the firm is not viable.
Next Steps
As these above incidents serious and fundamental issues going to the heart of your obligations to the firm and professional duties, and as these actions are:
·Wilful or deliberate behaviour by you that is inconsistent with the continuation of your contract of employment.

·Caused a serious and imminent risk to the health or safety of persons.
·Caused a serious and imminent risk to the reputation and viability of the firm.
·Was conduct in the course of your employment involving dishonesty relating to obtain a benefit involving money.
·Was wilful disobedience of fundamental and, in many instances, repeated requests of your employer.

·Constitutes wilful neglect of duty and incompetence, such that your continued engagement and presence of the firm is untenable during any period of potential notice.
·Are clear and repeated failures to abide by the firm’s policies and procedures, and as such are inconsistent with your continued employment at the firm in the position of trust and responsibility with respect to your role supervising other staff.
·Gives rise to a reasonable basis on which to suspect dishonesty, or at minimum, reckless and contemptuous attitudes towards your employer.
·Are inconsistent with the roles and duties of a legal practitioner.
·You refused to carry out a lawful and reasonable instruction that was consistent with your contract of employment.

We consider that your actions constitute serious misconduct warranting summary dismissal. Nevertheless, you have been invited to show cause as to why your employment should not be terminated. As your explanations have been unsatisfactory and as other serious grounds for misconduct have continued to emerge, your employment has been terminated.
Next steps
We consider that your actions constitute serious misconduct warranting summary dismissal.
You will also be paid your accrued entitlements and any outstanding pay up to and including your last day of employment. This includes the balance of any time off instead of overtime paid accrued but not yet taken (paid at the overtime rate applicable when the overtime was worked), and superannuation. This will be paid on the return of all property, keys and cards to MLS in the form that will be advised to you.
If you have been paid annual leave in advance, any amount still owing will be deducted from your final pay.
You may seek information about minimum terms and conditions of employment from the Fair Work Ombudsman. If you wish to contact them you can call 13 13 94 or visit their website at termination payments may give rise to waiting periods for any applicable Centrelink payments. If you need to lodge a claim for payment you should contact Centrelink immediately to find out if there is a waiting period.
Yours Sincerely,

James Stokes
Legal Practitioner Director”

The matter was scheduled to be heard by Video via Microsoft Teams on Friday, 5 July 2024. However, following the commencement of the Hearing, the Applicant made an oral application for the matter to be adjourned in light of her Counsel becoming unavailable at short notice before the Hearing.

I granted an adjournment of the Hearing on this basis.

Subject to the availability of both parties, the matter was relisted for Hearing by Video via Microsoft Teams on Tuesday, 6 August 2024. Both parties were granted leave pursuant to s.596 of the FW Act to be represented at the Hearing. The Applicant was represented by Mr Paul Carasco of Counsel. The Respondent was represented by Mr Calum Thwaites of Counsel.

The Applicant gave evidence on her own behalf at the Hearing. By way of an Order to Appear made at the Applicant’s request, Mr Mark Clare, former Solicitor for the Respondent, also gave evidence at the Hearing.

While the Applicant had filed a Witness Statement for Mr Mike Tran, Solicitor and former employee of the Respondent, at the Hearing the Applicant advised that she no longer sought to rely on Mr Tran’s evidence.

The following persons gave evidence for the Respondent at the Hearing:

Mr James Stokes, Legal Practitioner Director of the Respondent;
Ms Miranda Campbell, former Senior Lawyer for the Respondent.

By way of an Order to Appear made at the Respondent’s request, Mr Brian McGowran of McGowran & Cagney Lawyers, also gave evidence at the Hearing.

In accordance with Directions issued to the parties on 9 May 2024, the Applicant was required to file her materials by 4pm on 30 May 2024. On 29 May 2024, the Applicant wrote to my Chambers seeking an extension for filing. Further to an exchange of correspondence with the parties, including confirmation from the Respondent that it did not object to an extension being granted, the Directions in this matter were extended for all parties. These Extended Directions required the Applicant to file her reply materials by 2 July 2024. However, the Applicant failed to file her reply materials by the Directed date, and filed reply materials to Chambers on 3 July 2024. The Respondent raised an objection to them being accepted. I determined that the reply materials were not submitted in accordance with the new Directions and were not accepted. Accordingly, these materials have not been read and are not addressed in this Decision.

Statutory Provisions

The relevant sections of the FW Act relating to an unfair dismissal application are:

“396 Initial matters to be considered before merits  
The FWC must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:  
(a) whether the application was made within the period required in subsection 394(2);  
(b) whether the person was protected from unfair dismissal;  
(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;  
(d) whether the dismissal was a case of genuine redundancy.  
 

381 Object of this Part  
(1) The object of this Part is:  
(a) to establish a framework for dealing with unfair dismissal that balances:  
(i) the needs of business (including small business); and  
(ii) the needs of employees; and  
(b) to establish procedures for dealing with unfair dismissal that:  
(i) are quick, flexible and informal; and  
(ii) address the needs of employers and employees; and  
(c) to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement.  

(2) The procedures and remedies referred to in paragraphs (1)(b) and (c), and the manner of deciding on and working out such remedies, are intended to ensure that a “fair go all round” is accorded to both the employer and employee concerned.  
Note: The expression “fair go all round” was used by Sheldon J in in re Loty and Holloway v Australian Workers’ Union [1971] AR (NSW) 95.  
382 When a person is protected from unfair dismissal  
A person is protected from unfair dismissal at a time if, at that time:  
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and  
(b) one or more of the following apply:  
(i) a modern award covers the person;  
(ii) an enterprise agreement applies to the person in relation to the employment;  
(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold. 

384 Period of employment  
(1) An employee’s period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee.  
(2) However:  
(a) a period of service as a casual employee does not count towards the employee’s period of employment unless:  
(i) the employment as a casual employee was on a regular and systematic basis; and  
(ii) during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis; and  
(b) if:  
(i) the employee is a transferring employee in relation to a transfer of business from an old employer to a new employer; and  
(ii) the old employer and the new employer are not associated entities when the employee becomes employed by the new employer; and  
(iii) the new employer informed the employee in writing before the new employment started that a period of service with the old employer would not be recognised; the period of service with the old employer does not count towards the employee’s period of employment with the new employer.  

 
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.  

see section 388.  
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.

388 The Small Business Fair Dismissal Code

(1) The Minister may, by legislative instrument, declare a Small Business Fair Dismissal Code.

(2) A person’s dismissal was consistent with the Small Business Fair Dismissal Code if:

(a)immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened first), the person’s employer was a small business employer; and
(b)the employer complied with the Small Business Fair Dismissal Code in relation to the dismissal.”

The Small Business Fair Dismissal Code provides:-

“The Code
Summary Dismissal
It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.
Other Dismissal
In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.
The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.
The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.
Procedural Matters
In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.
A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.”

Applicant’s Submissions

Response to the jurisdictional objection

The Applicant submitted that it is unclear whether the Respondent has less than 15 employees, “as the business is run in tandem with Stokes Law, which includes shared offices, reception and call centre”. The Applicant submitted that the Respondent’s employees work between the two organisations, and Mr Stokes is a director of both entities.

However, the Applicant submitted that, in the event the Respondent is found to be a small business, her conduct was not serious enough to justify an immediate dismissal in accordance with the Code.

The Applicant submitted that the “major allegations of [her] serious misconduct” allegedly occurred in the week of 5 December 2023, when Mr Stokes was in Darwin. The Applicant submitted that prior to her dismissal, she was not provided any warning, email or letter stating that she had acted in breach of the Respondent’s policies or procedures. The Applicant submitted that she was not notified by the Respondent that she had acted dishonestly, wilfully disobediently, was neglectful of her duties and role, or had otherwise failed to carry out a lawful instruction of the Respondent. The Applicant submitted that at no time was she notified that she had caused a serious risk to the reputation and viability of the firm. Further, the Applicant submitted that the Respondent has not made any reports about alleged fraud to the police.

The Applicant submitted that the onus is on the Respondent to prove that it has complied with the Code.

Criteria for Harshness

Valid Reason

The Applicant submitted that the Respondent could not have concluded that she was guilty of serious misconduct based on the evidence provided by her in her Response to Notice to Show Cause Letter, which she emailed to the Respondent on 21 February 2024 (as extracted at paragraph [7] of this Decision).

The Applicant relied on the meaning of ‘serious misconduct’ as provided in regulation 1.07 of the Fair Work Regulations 2009. The Applicant submitted that in accordance with regulation 1.07, serious misconduct is considered “wilful, deliberate, inconsistent with the continuation of the contract of employment; and can cause serious and imminent risk to the health and safety of others or to the viability, reputation and profitability of the employer’s business”. The Applicant noted that ‘serious misconduct’ can include theft and fraud.[1]

The Applicant accepted that she did not follow the direction given to her during the investigation, when she emailed the Practice Manager regarding her medical certificates. However, she questioned whether this could be considered serious misconduct warranting dismissal.

As to the other allegations raised against her, the Applicant submitted that the alleged conduct did not occur and therefore there were no valid reasons for her dismissal. The Applicant submitted that there is a lack of specificity in relation to the allegations made against her, and this lack of specificity does not support any finding of serious misconduct.

As to the allegations of fraud with medical certificates and misallocation of finances, the Applicant submitted that there were no benefits allegedly gained by her. Further, the Applicant submitted that even where there has been ‘misappropriation and fraud’, this has been found in some cases not to be a valid reason for dismissal.[2]

As to the allegations of failure of duties to the client and the Court, the Applicant submitted that no evidence has been provided to support this allegation. Further, in her Witness Statement, the Applicant stated that all documents lodged with the Court and the conduct of the relevant matter were discussed with Counsel.

The Applicant submitted that as to the allegations of swearing and bad language, no evidence has been provided to support the allegation, and further the Commission has found that it is not a valid reason for dismissal.[3]

In relation to the allegation that she ‘gave her time’ to Mr Clare, the Applicant submitted that if this conduct was considered serious misconduct, then the Respondent should have issued her with a warning, summarily dismissed her, or advised her that an investigation would be carried out in relation to her billing practices. The Applicant submitted that she was permitted to attend work “following this alleged misconduct”, which is conduct that is inconsistent with the decision to dismiss her.

In her Witness Statement, the Applicant acknowledged that she did ‘give her time’ to Mr Clare on numerous occasions, however, denied that it was for the purpose of “making him look better so he would receive a pay rise”. The Applicant explained that she gave her time to Mr Clare on a number of occasions because she did not think it was appropriate to bill for her own time, as Mr Clare was undertaking legal work and her involvement was for the purposes of training him. The Applicant acknowledged in her witness statement that she is “aware that padding or gaming timesheets is prohibited by our MLS policy”. The Applicant stated that she did not act dishonestly with the intent of gaining a financial benefit for herself or Mr Clare.

As to the allegation that she failed to record dates as directed, in her Witness Statement the Applicant acknowledged that both she and Mr Clare were shown how to record court dates in ‘Actionstep’ around 7 or 8 December 2023. However, the Applicant and Mr Clare used their own system for recording dates, including in their daily ‘To Do List’. The Applicant stated that no further directions were given by the Respondent in relation to recording dates in ‘Actionstep’.

Notified of the Reasons for the Dismissal

The Applicant acknowledged that she was notified of the reasons for her dismissal.

Opportunity to Respond

The Applicant acknowledged that she was provided an opportunity to respond to the allegations made against her, and she did so via her correspondence of 21 February 2024.

Support Person

The Applicant submitted that there were no face-to-face meetings, accordingly, this factor is not relevant.

Unsatisfactory Performance

The Applicant submitted that her dismissal did not relate to unsatisfactory performance.

Size of the Employer’s Business and HR Specialists

The Applicant submitted that it was unclear to her whether the size of the Respondent would have impacted the procedures followed in effecting her dismissal. The Applicant submitted that the Respondent does not have dedicated human resource specialists.

Any other matter

The Applicant questioned whether a fulsome investigation was conducted regarding her alleged misconduct, and whether appropriate consideration was taken of her responses before the decision was made to dismiss her for serious misconduct. The Applicant submitted that there were only 4 days between her providing a Response to the Notice to Show Cause Letter and her employment being dismissed. The Applicant questioned whether this was a sufficient period of time for her responses to the allegations to be investigated, and a decision made about the future of her employment.

The Applicant submitted that she was not provided with any warnings or counselling sessions prior to her dismissal.

The Applicant submitted that the consequences of this dismissal on her personally and economically have been enormous. The Applicant submitted that the allegations made against her “are egregious and offensive”, and she has not managed to secure work since her dismissal. The Applicant submitted that she is in a “small regional center (sic) with a limited employment pool”. The Applicant also submitted that she suffers health issues which impact her ability to gain employment and noted that it is more difficult to gain work due to her age.

The Applicant submitted that she has applied for some roles but has received no responses. In relation to roles that would require her to travel, the Applicant submitted that her health does not allow her to do so.

The Applicant submitted that for all of the above reasons, her dismissal was harsh, unreasonable and unfair.

Remedy

The Applicant has acknowledged in her submissions that reinstatement is not appropriate, stating:

“It is clear there has been a loss of trust and confidence between the parties which can never be repaired”.

The Applicant seeks $72,100.08 in compensation.

Respondent’s Submissions

The Respondent denied that the Applicant was unfairly dismissed.

The Respondent noted that it would be harsh, unjust and unreasonable for an employer to dismiss an employee summarily on the ground of serious misconduct without taking reasonable steps to investigate the allegations of misconduct and give the employee a fair chance of answering them.[4] The Respondent referred to the definition of ‘serious misconduct’ as contained in the Fair Work Regulations 2009:

“1.07 Meaning of serious misconduct

(1) For the definition of serious misconduct in section 12 of the Act, serious misconduct has its ordinary meaning.
(2) For subregulation (1), conduct that is serious misconduct includes both of the following:

(a) wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment;
(b) conduct that causes serious and imminent risk to:
(i) the health or safety of a person; or
(ii) the reputation, viability or profitability of the employer’s business.

(3) For subregulation (1), conduct that is serious misconduct includes each of the following:
(a) the employee, in the course of the employee’s employment, engaging in:
(i) theft; or
(ii) fraud; or
(iii) assault; or
(iv) sexual harassment;

(b) the employee being intoxicated at work;
(c) the employee refusing to carry out a lawful and reasonable instruction that is consistent with the employee’s contract of employment.

(4) Subregulation (3) does not apply if the employee is able to show that, in the circumstances, the conduct engaged in by the employee was not conduct that made employment in the period of notice unreasonable.
(5) For paragraph (3)(b), an employee is taken to be intoxicated if the employee’s faculties are, by reason of the employee being under the influence of intoxicating liquor or a drug (except a drug administered by, or taken in accordance with the directions of, a person lawfully authorised to administer the drug), so impaired that the employee is unfit to be entrusted with the employee’s duties or with any duty that the employee may be called upon to perform.”
(My emphasis)

The Respondent submitted that where serious misconduct is alleged, the test for a valid reason for dismissal does not change. The test remains whether the reason was ‘sound, defensible or well founded’.[5]

Compliance with the Small Business Fair Dismissal Code

The Respondent submitted that a person’s dismissal is consistent with the Code if:

“a. immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened ﬁrst) the person’s employer was a small business employer; and
b. the employer complied with the Small Business Fair Dismissal Code in relation to the dismissal.”

The Respondent submitted that on 4 February 2024, the Applicant was stood down with pay pending the outcome of an investigation into her conduct.

The Respondent submitted that on 12 February 2024, Mr Stokes, the Legal Practitioner Director of the Respondent, issued the Applicant with a Show Cause Notice (extracted at paragraph [4] of this Decision), giving her notice to show cause as to why her employment with the Respondent should continue. The Show Cause Notice detailed:

“a. three alleged instances of serious misconduct; and

b. one alleged instance of misconduct.”

The Respondent submitted that on 15 February 2024, the Applicant was granted an extension to respond to the Show Cause Notice.

On 20 February 2024, the Applicant was informed through her solicitor of, and given an opportunity to respond to, a further allegation of serious misconduct, namely that she:

“a. yelled at a practitioner on the other side of a matter which she had carriage of; and

b. used the word “c*nt” in the same interaction with the practitioner on the other side of the matter.”

The Respondent submitted that the Applicant provided her response to the Show Cause Notice on 21 February 2024.

Mr Stokes then issued the Applicant with a ‘Notice of Termination’ letter on 25 February 2024.

The Respondent submitted that as at the relevant date, it had 12 Employees, therefore, the Code applied.

The Respondent submitted that it complied with the Code. It submitted that the Notice of Termination letter set out the findings made by the Respondent after the investigation into the Applicant’s conduct, and had regard to the Applicant’s Response to the Show Cause Letter.

As to the allegation of ‘misallocation of financial reporting to obtain a benefit’, the Respondent submitted that in her response, the Applicant admits to giving her time to Mr Clare. The Respondent submitted that Mr Clare then cited his financial performance in support of obtaining a substantial increase in salary. The Respondent noted that the Applicant denied what she was alleged to have said in a conversation with Mr Stokes. However, the Respondent submitted that it found that, on all the information available to it, the Applicant acted as alleged. The Respondent submitted that this was a substantial breach of the Respondent’s ‘Policy – Standards and Requirements of Fee Earners (Legal Staff)’, of which the Applicant admitted she was aware.

As to the allegation of ‘contacting staff other than directed during investigation’, the Respondent submitted that in both the Applicant’s Response to the Show Cause Letter and her submissions before the Commission, she accepts that she did not follow the directions given to her during the investigation into her conduct. The Respondent submitted that on the evidence before the Respondent at the time, it found that the Applicant had contacted staﬀ of the Respondent contrary to the direction she was given. The Respondent submitted that this was a failure by the Applicant to follow a lawful and reasonable direction.

Regarding the allegation of ‘failure of duties to the client and Court’, the Respondent submitted that as the practitioner with carriage of the matter the subject of the allegation, the Applicant was responsible for the conduct of the matter. The Respondent submitted that it found that the Applicant’s response in this regard did not address why court orders were not complied with, or why the Applicant twice signed oﬀ on certiﬁcates of readiness for trial on the matter when it was not ready for trial. The Respondent submitted that the Applicant’s Response purported to attach orders sought that she had drafted in the matter, in support of her denial of the allegation. However, the Respondent submitted that the Applicant in fact attached the orders sought by the other side in the matter. The Respondent submitted that on the information available, it found that the Applicant had acted as alleged. The Respondent submitted that this was serious misconduct which caused serious and imminent risk to the reputation, viability or proﬁtability of the Respondent.

In relation to the allegation of ‘falsely claiming personal leave’, the Respondent submitted that in support of her denial of this allegation, the Applicant provided numerous medical certiﬁcates with contradictory dates. The Respondent submitted that it expressed significant concerns regarding the medical certiﬁcates and found that, based on the information available to it, the Applicant had acted as alleged.

As to ‘failure to record court dates as directed’, the Respondent submitted that the Applicant admitted that she had been directed to record court dates in accordance with the Respondent’s policy. The Respondent submitted that on the information available to it, it formed the view that the Applicant had continued to not record court dates as directed. The Respondent submitted that this was a substantial breach of the Respondent’s policy, of which the Applicant admitted she was aware. Further, the Respondent submitted that this was also a failure by the Applicant to follow a lawful and reasonable direction.

As to the allegation that the Applicant swore and yelled at an opposing practitioner, the Respondent noted that the Applicant’s Response to the Show Cause letter denied the alleged conduct. However, the Respondent submitted that it formed the view that on the information available to it, including conﬁrmation from the practitioner involved, the Applicant acted as alleged. The Respondent submitted that this was serious misconduct which caused serious and imminent risk to the reputation, viability or proﬁtability of the Respondent.

Conclusion

In conclusion, the Respondent noted that the Applicant’s employment was terminated following:

“a. an investigation into her conduct;

b. the Show Cause Notice being issued;

c. Ms Brackenreg being notiﬁed of a further allegation of serious misconduct; and

d. Ms Brackenreg being given every reasonable opportunity and suﬃcient time to opportunity to respond to the Show Cause Notice and further allegation of serious misconduct.”

The Respondent submitted that it found, on the information available to it, that the Applicant committed each instance of misconduct and serious misconduct. The Respondent submitted it, therefore, had multiple valid reasons relating to the Applicant’s conduct to dismiss her.

The Respondent submitted that the Commission ought to be satisﬁed that the Applicant’s dismissal:

“a. was not harsh, unjust or unreasonable; and

b. was consistent with the Small Business Fair Dismissal Code.”

The Respondent submitted that if the Commission finds, contrary to the Respondent’s submission, that the Applicant was unfairly dismissed, then any compensation ordered must be reduced by an appropriate amount on account of the Applicant’s misconduct.

Consideration

I have taken into account all of the submissions that have been provided by the parties and I have attached the appropriate weight to the evidence of the witnesses.

It is not in dispute, and I find, that the Applicant is protected from unfair dismissal, submitted her application within the statutory timeframe and was not made genuinely redundant.

Jurisdictional objection

The Respondent has raised a jurisdictional objection on the basis that they are a small business and complied with the Code. However, for the Respondent to rely on the Code, they must comply with its provisions.

In Shaw v Pat Thomas Memorial Community House Inc[2012] FWA 8303 (Shaw), Williams C made the following observation:-

“[95]Even if these reasons were valid reasons for dismissal the Applicant had been denied procedural fairness by the Respondent in that prior to being handed the letter of termination there had been no discussion with her about the supposed failure to follow a written direction or that her actions could be seen as an attempt to undermine the authority of the Executive Officer. In fact there were no discussions at all with the Applicant about any of these matters prior to the Respondent taking the decision to dismiss the Applicant. The letter of termination was delivered to the Applicant as a fait accompli.

The Small Business Fair Dismissal Code

[96]To comply with the Small Business Fair Dismissal Code there must be a valid reason based on employees conduct or capacity and the employee must be warned that he or she risks being dismissed if there is no improvement and the employee must be given an opportunity to respond to the warning and given a chance to rectify the problem. None of these requirements were met and consequently the dismissal of the applicant was not consistent with the Small Business Fair Dismissal Code.”

The Applicant has raised an objection that the Respondent is not a small business. The Respondent has refuted this claim via submission and claims that it had less than 15 employees at the time of the Applicant’s termination. Without evidence to the contrary, I accept that the Respondent is a small business, however, this issue is not relevant in my overall finding in this matter.

Jurisprudence

When considering whether a termination of an employee was harsh, unjust or unreasonable, the oft-quoted joint judgement of McHugh and Gummow JJ in Byrne v Australian Airlines (Byrne)[6] is of significance:

“It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.”  

In analysing Byrne, a Full Bench of the Australian Industrial Relations Commission in Australian Meat Holdings Pty Ltd v McLauchlan (AMH)[7] held:

“The above extract is authority for the proposition that a termination of employment may be:  

·            unjust, because the employee was not guilty of the misconduct on which the employer acted;  
·            unreasonable, because it was decided on inferences which could not reasonably have been drawn from the material before the employer; and/or  
·            harsh, because of its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct”.

Further, a Full Bench of the AIRC in King v Freshmore (Vic) Pty Ltd[8] said:

“[24] The question of whether the alleged conduct took place and what it involved is to be determined by the Commission on the basis of the evidence in the proceedings before it. The test is not whether the employer believed, on reasonable grounds after sufficient enquiry, that the employee was guilty of the conduct which resulted in termination”.  

I now turn to the criteria for considering harshness as provided in s.387 of the Act.

Section 387(a) - Valid Reason

The meaning of the phrase “valid reason” has been universally drawn from the judgement of Northrop J in Selvachandran v Peteron Plastics Pty Ltd:[9]

“In broad terms, the right is limited to cases where the employer is able to satisfy the Court of a valid reason or valid reasons for terminating the employment connected with the employee’s capacity or performance or based on the operational requirements of the employer. … 

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. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them.  The provisions must “be applied in a practical, commonsense way to ensure that” the employer and employee are each treated fairly…”.

In Rode v Burwood Mitsubishi,[10] a Full Bench of the Australian Industrial Relations

Commission held:  
 

“… the meaning of s.170CG(3)(a) the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts. It is not sufficient for an employer to simply show that he or she acted in the belief that the termination was for a valid reason.” 

The Applicant’s employment contract was tabled as Annexure A of Exhibit 3 on page 86 of the Court Book. Relevantly, the contract states:-

“Professional standards and courtesies

40. While an employee, you will recognise and embody the professional standards and courtesies required of our employees. While engaged by us you must:
…
(c) act with integrity and honesty in all matters and at all times act in accordance with law;
(d) assume responsibility and accountability for your actions and the tasks assigned to you;

(e) always treat colleagues, employees, clients and third parties with dignity and respect;
…
Termination
…
44. We may terminate your employment without notice if we have reasonable grounds to suspect that you are guilty of misconduct. Misconduct includes (but is not limited to) dishonesty, wilful disobedience, violence, neglect of duty or incompetence, drunkenness or being under the influence of illicit drugs, wilful damage, misrepresentation of your qualifications or employment history, breach of confidence, failure to abide by the policies or procedures of the firm, conduct which may injure our reputation or our employees or unconscionable conduct.
…
Goodwill
46. While you are engaged by us and for a six-month period following the end of your term you must not:
…
(c) encourage or induce any clients, customers, suppliers or our referrers to end or restrict their relationship with us.”

(My emphasis)

I have taken this into account.

Mr McGowran testified that the Applicant used the word “c*nt” while making a comment about Mr McGowran’s client. I am satisfied that Mr McGowran is a witness of credit. Contrary to the assertion from the Applicant that she “would never say that word”, I am satisfied and find that the Applicant used the word “c*nt” to describe Mr McGowran’s client.

I note that Mr McGowran was not offended by this description of his client but took offence to the accusation that he was “gouging” his client in relation to the fees that he was charging for his services. It is highly inappropriate for a solicitor to use such a derogatory and demeaning term to describe the opposing solicitor’s client or accuse that solicitor of fee gouging his client. It is unprofessional conduct and certainly behaviour which does not comply with the obligation to treat third parties with dignity and respect as per the Applicant’s employment contract and the Respondent’s policies. I have taken this into account.

It is apparent that the Applicant has difficulty in following time-based directions. It is beyond my comprehension why an applicant who is a practicing lawyer would not comply with the directions in her own case. I am usually very lenient on a self-represented applicant, however, in this matter, after providing the Applicant with an extension of time to submit her initial witness statement and submissions, my tolerance evaporated when her reply submissions did not meet the Directions timeframe. This conduct or lack of attention to detail correlates to the Applicant’s conduct in relation to the W file matter. I have taken this into account.

I do not accept the excuse by the Applicant that her actions in the W file were signed off by Counsel in delaying the hearing of that matter. There is no evidence from Counsel supporting that assertion. I agree with the Respondent that the Applicant had carriage of the matter, not the barrister. Further, the medical certificate obtained by the Applicant to delay the hearing was not as a result of any medical examination conducted by a medical practitioner on the Applicant’s client, but merely a certificate based on an email from the Applicant to the medical practitioner to provide an outcome to a legal problem. I am satisfied that such a practice is misleading. I have taken this into account.

The most serious accusation in my view is in relation to the filling out of timesheets and the Applicant “giving her time” to her colleague, Mr Clare. The Applicant has admitted that she was involved in this practice but only because she was training or supervising Mr Clare. The Applicant claims that she made the decision as to which hours she billed for her services. Mr Stokes testified that the Applicant had no right to make any decision not to bill for her hours – that was his job. The supervision of a new and inexperienced lawyer is not a hand-holding exercise. If a senior lawyer is required to directly supervise then clearly someone has to pay for the senior lawyer’s time. Such an outcome is commonsense. In this case, I am satisfied and find that the Applicant was in fact ‘gaming’ the timekeeping system to boost Mr Clare’s billable hours. I accept the evidence of Mr Stokes that Mr Clare was going to receive a pay rise in 2024 due to his improved competency but resigned prior to the increase being processed. Mr Clare must have looked to be performing extremely well with his billable hours, even though it would appear that the Applicant was involved in 90% of his daily work and her billable hours had dropped considerably. I have taken this into account.

I accept the submission from Mr Thwaites that the Applicant has not been charged with fraud but knowingly and deliberately breaching the Respondent’s policy. I have taken this into account.

The Applicant claims that she submitted her sick leave certificate as soon as she was capable. I do not accept this submission. The Applicant claims to have lost her original certificate on the day that she first went to see the doctor, i.e. 29 January 2024. Rather than simply ringing the receptionist and asking for another copy, the Applicant made a new appointment on 5 February 2024 to obtain a new certificate. However, the Applicant did not submit this certificate or any of the others that she obtained until after she had received her Show Cause Letter on 12 February 2024. If the Applicant was able to travel to see a doctor, then I am satisfied that she was capable of taking a photo of, or scanning, the certificate and sending it to the Respondent. I take no issue with the Applicant sending the certificate to Mr Naker. I have taken these issues into account.

I am satisfied and find that Mr Clare and the Applicant made a conscious decision to simply ignore the direction to put all court dates into a centralised computer system and simply continued to utilise their preferred written diary system that they had adopted in Darwin. There is no reason why they couldn’t have both systems working concurrently, but I am satisfied that the requirement to use the centralised computer-based system was a reasonable and legal direction. I have taken this into account.

I accept that the Applicant was stressed and overwhelmed. The W file matter was turning for the worse. That may have been due to the actions of the Applicant or due to the health of the Applicant’s client, but the matter was clearly not ready for Court. The Respondent took the view that the matter was heading in the wrong direction which had the capacity to have financial and reputational consequences for the business. The Respondent was entitled to take that view. I have taken this into account.

For the above reasons, I find that the Respondent had a valid reason to dismiss the Applicant.

Section 387(b) - Notified of the Reason

The Applicant was notified of the reasons for her dismissal. I have taken this into account.

Section 387(c) - Opportunity to Respond

The Applicant afforded an opportunity to respond and availed herself of this opportunity. I have taken this into account.

Section 387(d) - Any refusal of a support person

There were no formal meetings ahead of the Applicant’s dismissal, and therefore no refusal of a support person by the Respondent. I have taken this into account.

Section 387(e) - Unsatisfactory performance

I am satisfied that the Applicant did not receive any formal written warnings in relation to any issue of her performance. I have taken this into account.

Section 387(f) - Size of Employer

While the size of the Respondent’s business is disputed between the parties, the Respondent is not a large employer. I have taken this into account.

Section 387(g) - Dedicated HR specialists

The Respondent does not employ dedicated HR specialists. I have taken this into account.

Section 387(h) - Any other matter

I agree with the Applicant that the investigation was not as thorough as it should have been. I can see no reason, for example, why Mr Clare was not interviewed. However, even if the investigation was conducted in a fulsome manner, I am satisfied that the outcome would have been the same. I have taken this into account.

I have taken into account the economic impact that the termination has had on the Applicant, and her capacity to find alternative employment in the legal profession in Darwin.

Conclusion

This decision is in relation to an unfair dismissal application from the Applicant. It is not a decision in relation to the Applicant’s legal competency or capacity.

I have previously found that the Respondent had a valid reason to terminate the Applicant. I do not believe that the financial impact of a termination upon the Applicant or the perceived lack of depth of the investigation are issues of such magnitude to override the multiple valid reasons that the Respondent has relied upon in terminating the Applicant.

The Applicant has received her statutory entitlement to a ‘fair go’.

The Applicant’s conduct was in breach of her contract of employment, which provided for her termination without notice for misconduct.

For the reasons identified above, I am satisfied and find that the Applicant has not been unfairly dismissed.

The application is dismissed.

I so Order.

COMMISSIONER

[1] Fair Work Regulations 2009, regulation 1.07.

[2] McKerrow v Sarina Leagues Club Incorporated T/A Sarina Leagues Club[2012] FWA 1251.

[3] Symes v Linfox Armaguard Pty Ltd[2012] FWA 4789.

[4] Department of Social Security v Uink Print P7680 (AIRCFB, Ross VP, Drake DP, Palmer C, 24 December 1997).

[5] Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373; Annetta v Ansett Australia Ltd Print S6824 (AIRCFB, Giudice J, Williams SDP, Cribb C, 7 June 2000), [10].

[6] (1995) 185 CLR 410.

[7] (1998) 84 IR 1.

[8] [2000] AIRC 1019.

[9] (1995) 62 IR 371.

[10] PR4471.

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