[2015] FWC 5504

FAIR WORK COMMISSION

DECISION

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

Dennis Blackburn
v
ISS Health Services Pty Ltd
(U2015/5126)

COMMISSIONER HAMPTON

ADELAIDE, 7 OCTOBER 2015

Application for relief from alleged unfair dismissal – dismissal based upon alleged inability to perform the inherent requirements of the job – long term workers compensation claim – whether valid reason for dismissal – whether compliance with workers compensation laws relevant - whether procedure and timing unfair – dismissal premature and procedurally unfair – remedy – compensation determined and ordered.

1. Background and Case Outline

[1] Mr Dennis Blackburn has made an application under s.394 of the Fair Work Act 2009 (the FW Act) seeking a remedy for an alleged unfair dismissal by his former employer, ISS Health Services Pty Ltd (ISS).

[2] ISS is a multi-national corporation and one of Australia’s largest facilities services companies which provides a range of services including Catering, Health Support Services, Washroom Services, Grounds Maintenance, Open Space Services, Pest Control and Security. Mr Blackburn worked as a ward support employee at the Queen Elizabeth Hospital (QEH) in Adelaide, where ISS provides Health Support Services.

[3] Mr Blackburn commenced employment in May 2004 and was dismissed on 20 March 2015, with an effective termination date of 18 April 2015. On 1 July 2013, Mr Blackburn suffered a back injury at work and made a workers compensation claim. The claim was accepted, and after approximately two weeks off work, Mr Blackburn returned to work on restricted duties. For the balance of his employment with ISS, Mr Blackburn remained on restricted duties that involved limitations upon the duties to be undertaken and the hours of work. At the time of his dismissal Mr Blackburn generally worked for three hours on each Thursday, Saturday and Monday.

[4] Mr Blackburn was dismissed by ISS on the basis of his alleged inability to perform the inherent requirements of his job.

[5] There is no dispute that Mr Blackburn was protected from unfair dismissal within the meaning of s.382 of the FW Act and there is a valid application before the Commission.

[6] Mr Blackburn seeks a finding that the dismissal was harsh, unjust and unreasonable based on a number of contentions. These include that the dismissal was in contravention of the Workers Rehabilitation and Compensation Act 1986 (SA) (WRC Act) and in particular, an obligation within that Act which requires the employer to provide on-going suitable work to an employee in certain circumstances. The “breach” amounted to an unlawful termination and this meant that there was no valid reason. Mr Blackburn contends in the alternative that the dismissal was premature and accordingly without a valid reason in any event.

[7] Mr Blackburn further contends that there was a level of procedural unfairness in that Mr Blackburn was denied the opportunity to respond to the impending dismissal and was, in effect, denied the opportunity to request to have a support person with him during discussions that should have been held. Mr Blackburn further contends that the dismissal was harsh in terms of the manner of the dismissal and its effect upon him. The factors relied upon in that regard include his age (57 years), his service with ISS (11 years), the illness and incapacity that Mr Blackburn is suffering and the impact of the dismissal given those circumstances, and the fact that no one from ISS contacted Mr Blackburn for a period of two months leading up to his termination to explain what was happening with his employment.

[8] Mr Blackburn initially sought reinstatement; however at the outset of the proceedings before the Commission he indicated that he was seeking the maximum compensation available under the FW Act.

[9] ISS submits that the dismissal was not unfair, unjust or unreasonable and is seeking that this application be dismissed. ISS contends that any alleged contravention of the WRC Act is not relevant and was not a matter to be determined by the Commission. Rather, that issue should be dealt with by the appropriate Court or Tribunal. In the alternative, ISS contends that it was not practicable to continue to employ Mr Blackburn as the injury occurred in July 2013 and there was no sign of improvement or likely recovery to full duties. Furthermore, ISS contends that the dismissal was not premature given the length of time since the injury had occurred and the circumstances at the time of the dismissal.

[10] ISS accepts that there was an element of procedural unfairness and concedes that the process leading to the dismissal was not satisfactory. That is, it would have been prudent for ISS Managers to contact the applicant and to keep him informed of their intention when confirmed and as further developments were taking place. ISS contends that whilst one element of the procedure may impact on the harshness of the dismissal, in the end result, the overall outcome would not have been any different.

[11] This application was subject to a hearing following consultation with the parties as contemplated by s.399 of the FW Act.

2. The evidence

[12] Mr Blackburn provided a witness statement and gave evidence in the matter.

[13] ISS provided witness statements and led evidence from the following employees:

● Steven Mann, ISS Facility Service Manager TQEH; and
● Phillip Pizimolas, Regional Manager HSE & Injury Assist SA/NT.

[14] I found all of the witnesses to be reliable and each genuinely attempted to provide their version of the facts.

[15] There are few factual disputes in this matter. Those disputes largely concern the detailed staffing arrangements that accompanied the restricted duties being undertaken by Mr Blackburn. In addition, there is some dispute about the sequence of events during the course of a case conference and whether the details of some of the positions arising from that meeting were accurately recorded in the notes subsequently issued. I have determined this based upon the weight of evidence and the capacity for each of the witnesses to give evidence about that detail.

[16] There are differences of opinion as to what is reasonable and fair; however, these are matters largely for the Commission.

[17] I note that neither party sought to lead direct medical evidence and each relied upon the written reports provided by the relevant practitioners in the lead up to the dismissal.

3. Mr Blackburn’s employment and the events leading to his dismissal

[18] Mr Blackburn commenced employment as a full-time employee with ISS on 29 April 2004 and was based at the QEH. When Mr Blackburn started with ISS he worked in support services which involved moving equipment and patients across several wards. Following this, Mr Blackburn worked in radiology, which also involved him moving patients, along with other duties. For the last three years of Mr Blackburn’s employment he was employed in the South 2 ward and the High Dependency Unit (HDU) at the QEH. Mr Blackburn was a ward support employee and his main duties involved restocking medications for the ward, “running” medication, specimens and equipment when required, moving patients within the hospital and discharging patients.

[19] Mr Blackburn suffered a back injury on 1 July 2013 in the course of his employment. Mr Blackburn made a claim for workers compensation which was accepted. Mr Blackburn’s injury was managed by a claims agent, Employers Mutual SA Pty Ltd (EML), which acted for the relevant Workers Compensation authority. Mr Blackburn was deemed totally unfit for work for a period of about two weeks.

[20] Following this, Mr Blackburn returned to work on restricted (modified) duties. When Mr Blackburn initially returned to work he was able to be rostered for two hours per day. Over time, Mr Blackburn’s duties remained restricted due to issues with pain and capacity and a modified work assignment was implemented in an attempt to rehabilitate him back into full employment. Mr Blackburn’s treating doctor, Dr Salagaras, certified that he could not lift above 5 kg, he could not do any pushing, pulling or lifting, and that he needed to be able to rest when needed and not be involved in any prolonged sitting or standing. In terms of Mr Blackburn’s role it meant that, amongst other limitations, he could not be involved with the physical elements of discharging or moving patients or heavy equipment within the hospital.

[21] Mr Blackburn’s considered that this left about 80% of his ward support duties that he was able to perform and I note that there is no evidence that a functional capacity assessment was undertaken in that regard. However, it is evident that the physical lifting elements of his normal role had to be undertaken by other employees.

[22] Over the period, Mr Blackburn’s working hours did fluctuate, and at best, these increased to five hours per day. However, since at least 12 January 2014, Mr Blackburn has been working a maximum of three hours on three days per week, with no apparent increase in physical capacity.

[23] Around September or October 2014, Mr Blackburn was transferred to general dispatch duties which involved him walking around the hospital delivering equipment, specimens and paperwork. Mr Blackburn rejected the notion that this was a better position for him and indicated that he found it more difficult than the ward support duties.

[24] During the time when Mr Blackburn was on restricted duties, his pre-injury role was supplemented by another ISS employee for the full shifts on weekdays. That is, there was in effect a supernumerary employee who undertook the substantive role. This does not however mean that the work being undertaken by Mr Blackburn was not real and it is evident that he did add to the overall staffing complement. On weekend shifts, there was no additional employee and any lifting or related work was undertaken by employees from other wards who carried pagers to be called in to do that work.

[25] In December 2014, Mr Blackburn attended his medical specialist, Dr YH Yau, at the request of EML. Dr Yau provided a report which indicated, amongst other matters, as follows: 1

“5. Although Mr Blackburn has received all appropriate support and assessments, I believe he will not be able to return to his pre-injury duties until further active treatment for his likely depression is undertaken. This is not his sole condition but I believe this is currently the major barrier and any attempts to modify or change his work pattern or physical exercise us unlikely to result in substantial improvement at this late stage. There is still the possibility that, should these factors be addressed, Mr Blackburn will make significant improvements and therefore a determination on expected recovery time and the possibilities of pre-injury duties can be made in the future

… …

8. Having reviewed the work site assessments I would conclude Mr Blackburn is at present unable to return to his pre-injury duties or any duties that involve manual handling. He has poor sitting and standing tolerance and as detailed above, any significant changes to these work activities is unlikely to be of relevance until a more definitive decision on psychological assessment and treatment of depression is undertaken. In the meantime it would be appropriate for Mr Blackburn to retain some form of work activity and his current recommended duties, together with restrictions in excessive bending, twisting or lifting of heavy items are appropriate.

9. The current treatment plan for Mr Blackburn is suitable in terms of his limited work hours. I would strongly recommend that he attend for further psychology assessment both on a focus regarding persistent pain syndrome, addressing sleep disturbance and the management of depression. I note that your attached reports that the possibilities of depression have already been identified. I note that Mr Blackburn’s general practitioner has mentioned the possibilities of commencing antidepressant therapy. I have encouraged this and also explained to Mr Blackburn that his on-going right-sided neuropathic leg symptoms are real and antidepressant therapies may have a secondary action to manage neuropathic pain. I have discussed the option of an epidural steroid injection. Mr Blackburn has researched this on the Internet and has quite a focus on the potential negative outcomes from epidural injections. Whilst there are risks, I do not consider the weighting that he has applied to the negative outcomes to be balanced. Nonetheless he is correct in identifying potential risks and therefore there is no requirement to insist that he undergo an epidural injection. The benefits would likely only be short-term and aimed at breaking the pain cycle to allow him an increase in his activities

In conclusion I recommend Mr Blackburn have further review with his general practitioner with a possibility of onward referral for psychiatry and on-going psychology review. It is important that he understand that pain is defined as an unpleasant sensory and emotional experience in relation to some form of injury or damage to the somatosensory system. His initial injury was the significant right L5/S1 disc protrusion which in itself has resolve partially over time.

10. Despite the sustained physiotherapy, Pilates and hydrotherapy treatments I do not consider Mr Blackburn is making significant progress in the latter few months. These strategies may have more significant contributions to his overall recovery if the above is addressed. In the meantime a review of these treatments and reduction in their frequency may be considered provided it is not interpreted as a withdrawal of support.

11. The main identifiable barrier preventing a return to work includes the above noted which is the development of persistent pain syndrome together with the possibilities of reactive depression. These are initially pathology related with the component of pain behaviour. There is some reliance on Endone as an opiate therapy but the use of this, according to Mr Blackburn, is not on a daily basis. I have indicated that opiate therapy will contribute to central sensitisation and the wind up of persistent pain symptoms.

12. The main serviced in relation to activities of daily living include support for all heavier manual aspects of home care. I expect these services will be reduced in time should we be able to address the above detailed barriers preventing his return to work or activity.

13. On initial evaluation it would be considered that Mr Blackburn’s prognosis for return to pre-injury work to be poor. I do however make reference to the above details appropriate assessment and treatment of a psychological state and an increased understanding of persistent pain may still result in significant improvement. This may allow him to adopt suitable employment in the future. Mr Blackburn still indicates his desire to return to his pre-injury occupation and this remains a positive factor which, despite the poor prognosis factor of the duration of symptoms will still encourage on-going support and treatment. I believe the appropriate selection of antidepressant therapy to act in addition as a secondary neuromodulator for persistent neuropathic symptoms; on top of his previously trialled pregabalin has a reasonable chance of reducing this significant component of his on-going symptoms.”

[26] On 19 February 2015, Mr Blackburn attended a Medical Case Conference convened by EML to discuss the on-going management of Mr Blackburn’s injury in light of the above report. In attendance were Mr Blackburn, Dr Salagaras (treating Doctor), his Physiotherapist, and Psychologist. Mr Pizimolas and Lindy Williams, and an ISS Case Manager, were in attendance for ISS. Also in attendance were an EML Case Manager and EML Injury Management Advisor.

[27] The participants in the case conference discussed the report including the recommendation that Mr Blackburn commence a course of anti-depressants and seek further assistance with pain management.

[28] The meeting noted that Dr Salagaras had prescribed an anti-depressant for Mr Blackburn approximately 6 or 7 weeks earlier. Dr Salagaras reported that since being on this medication there was no major change in the applicant’s depression or any progress. Dr Salagaras also outlined that she would be surprised if any change occurred given there has been no improvement since commencing with the anti-depressants.

[29] Dr Salagaras suggested that Mr Blackburn consider his options, being a cortisone injection or surgery. She advised if he took one of these options he may improve in the future, although the doctor expressed some reservations. Dr Salagaras predicted that if Mr Blackburn would not agree to any of the additional treatment, it was likely that he would remain with the then current restrictions given it is now 18 months since the date of injury and Mr Blackburn’s pain levels had not improved.

[30] The conference also discussed the impact of Pilates and EML indicated that it would require a treatment plan, as Dr Yau had suggested this treatment would not lead an improvement.

[31] EML advised that it could not continue to provide home help services after a specific time and that Mr Blackburn would need to be more independent in his home help in the future.

[32] Mr Pizimolas advised Mr Blackburn and others attending the conference that the employer had been supportive for the last 18 months in providing alternative duties for the applicant. He also advised that ISS was not going to be able to continue to offer these alternate duties if there was no evidence to support an increase in capacity or if Mr Blackburn could not return to his pre-injury duties. Mr Prizimolas also outlined that ISS could not continue to sustain these duties as they were parts of other roles. He also advised he would speak with Management to consider if ISS could continue to provide duties and would advise EML of the outcome of the discussion.

[33] EML explained, in effect, that it would assess any decision made by ISS and if it considered that if it was not reasonable for ISS to continue to provide on-going duties, it would then assist by providing access to on-going support through what was described as the New Employment Transition (NET) program.

[34] Mr Blackburn was upset about potentially not being able to stay with ISS and confirmed his understanding that the employer had an obligation to continue to provide work for a period of 130 weeks. EML indicated that the 130 weeks was associated with the obligation to make compensation payments and that there was new legislation that would operate from July 2015.

[35] Mr Blackburn considered that he was being “blindsided” by these developments. EML indicated that if a separation from ISS was approved, it would support the applicant through this process by providing direct income support and providing services to assist him to find suitable alternative employment.

[36] Dr Salagaras and the applicant’s psychologist both expressed the view that the decision making process associated with the potential “separation” should slow down, however they also agreed that ISS had been supportive in providing duties to that point.

[37] Dr Salagaras indicated that Mr Blackburn’s mental health may be negatively impacted if his then current role was taken away. Dr Salagaras did however also apparently acknowledge that the applicant could not presently return to his pre-injury duties.

[38] I note that following the case conference, ISS did not further update Mr Blackburn on its confirmed intentions and apparently left the process to be managed by EML. Mr Blackburn also contacted Mr Mann in relation to what was occurring. Mr Mann was unable to provide Mr Blackburn with any answers however he did refer the matter to an appropriate person within ISS to provide a response. ISS did not subsequently contact Mr Blackburn prior to his actual termination.

[39] On 23 February 2015, ISS ceased providing Mr Blackburn with duties and advised EML that it would not provide alternative duties pending EML’s decision about the NET. At that time, EML apparently advised Mr Blackburn that he should not attend for work.

[40] On 5 March 2015, ISS (and the other parties) received correspondence from EML that confirmed their discussions and the outcomes of the case conference held on 19 February 2015.

[41] On 13 March 2015, EML wrote to ISS in the following terms: 2

“…

New employer direction approved

I refer to our discussion that ISS Health Services Pty Ltd is unable to provide suitable employment for Mr Blackburn for the following reasons:

ISS Health Services Pty Ltd cannot continue to provide light duties on an on-going basis and have no other light work available within ISS.

Section 58B of the Act places a positive obligation on ISS Health Services Pty Ltd to provide suitable employment to an injured worker unless it is not reasonably practicable to do so.

Employers Mutual has investigated the circumstances of the case and as a result of those investigations has determined that it is not reasonably practicable for ISS Health Services to provide suitable employment to Mr Blackburn for the following reasons:

ISS Health Services cannot continue to provide light duties on-going and they have no other suitable light duties available. It has been advised by the treating practitioners that Mr Blackburn is unable to return back to his pre-injury duties in the foreseeable future.

If suitable employment becomes available for the worker in your employment or Mr Blackburn’s capacity improves to support a return to work in suitable employment with you, I may revisit your obligations (in accordance with section 58B(1) of the Act).

If you are dissatisfied with this decision you may apply to WorkCoverSA for a review. To apply for a review you must complete the attached Application for Review form. The completed Application for Review must be received by WorkCoverSA within 14 calendar days of the date of this letter.

This decision will formally come into effect unless an Application for Review is lodged

If you would like to discuss this matter you can contact me on....

… …
Case Manager
Employers Mutual”

(Extract of S.58B of the Workers Rehabilitation and Compensation Act 1986, as amended and Notice of Review Form Omitted)

[42] On 20 March 2015, ISS wrote to Mr Blackburn advising that his employment was terminated in the following terms: 3

“… …

Dear Dennis,
Re: Termination of employment

I have received notification from Employers Mutual Ltd concerning the termination of your employment with ISS Health Services Pty Ltd.

The WorkCover Validation Officer has fully investigated the circumstances surrounding our request of termination of employment under section 58B of the Workers Rehabilitation and Compensation Act 1986, and is satisfied it is not reasonable practicable for ISS Health Services Pty Ltd to provide on-going employment.

I am required by law to give you 28 days notice in accordance with section 58C of the Act from the date the new employer direction was approved. The last day of employment with ISS Facility Services will be 18/04/2015 and at which time any outstanding leave entitlements will be paid.

From 23/02/2015 Employers Mutual Ltd will commence paying your income maintenance directly to you.

I wish you well for the future, and if you have any concerns please don’t hesitate to contact me on …….

Yours sincerely
… … …. …
Regional Manager - Health SA.”

[43] I note that the termination letter refers to a “WorkCover Validation Officer fully investigating the circumstances of the matter and is satisfied that it is not reasonably practicable for ISS to continue to provide Mr Blackburn with on-going employment”. The evidence before the Commission reveals that the WorkCover Validation Officer, which is a role external to EML, was not involved in the decision making process.

[44] As indicated in the termination letter, Mr Blackburn’s employment with ISS concluded on 18 April 2015. I also note that ISS commenced directly paying income maintenance to Mr Blackburn as from the date that ISS advised that it had withdrawn the provision of modified duties to the applicant.

[45] There was no information provided by, or contact made with, Mr Blackburn by ISS following his dismissal letter.

[46] The dismissal did negatively impact upon Mr Blackburn’s depressive illness symptoms.

4. The potential relevance of the WRC Act

[47] It is common ground that the WRC Act applied to Mr Blackburn and created certain entitlements and obligations associated with his workers compensation claim.

[48] Mr Blackburn principally relies upon s.58B of the WRC Act which provides as follows:

“58B—Employer's duty to provide work or pay wages

(1) If a worker who has been incapacitated for work in consequence of a compensable injury is able to return to work (whether on a full-time or part-time basis and whether or not to his or her previous employment), the employer from whose employment the injury arose must provide suitable employment for the worker (the employment being employment for which the worker is fit and, subject to that qualification, so far as reasonably practicable the same as, or equivalent to, the employment in which the worker was employed immediately before the incapacity).

Maximum penalty: $25 000.

(2) Subsection (1) does not apply if—

(a) it is not reasonably practicable to provide employment in accordance with that subsection (and the onus of establishing that lies in any legal proceedings on the employer); or
(b) the worker left the employment of that employer before the commencement of the incapacity for work; or
(c) the worker terminated the employment after the commencement of the incapacity for work; or
(e) the employer currently employs less than 10 employees, and the period that has elapsed since the worker became incapacitated for work is more than 1 year.

(3) If a worker who has been incapacitated for work in consequence of a compensable injury undertakes alternative or modified duties under employment or an arrangement that falls outside the worker's contract of service for the employment from which the injury arose, the employer must pay an appropriate wage or salary in respect of those duties unless otherwise determined by the Corporation.”

[49] In support of the proposition that compliance with such a provision is relevant to this matter, the applicant relies upon the approach of the Full Bench in J Boag and Son Brewing Pty Ltd v Button 4 (J Boag) as follows:

“[29] It is well established that a valid reason is one which is “sound, defensible or well founded”, but not “capricious, fanciful, spiteful or prejudiced”. 5 An inability to perform the inherent requirements of a position will generally provide a valid reason for dismissal. But this will not invariably be so. For example, the dismissal may be prohibited by State workers compensation legislation or otherwise unlawful. It is highly likely, bordering on certain, that there could be no valid reason for the dismissal in that event.6 Further, a dismissal based on an incapacity to perform the inherent requirements of a position may not be valid reason for dismissal if the employee has a capacity to perform the inherent requirements of their job. Plainly, there can be a valid reason for the dismissal of an employee where he or she simply does not have the capacity (or ability) to do their job.7 But, again, there may be circumstances where such incapacity does not constitute a valid reason in the relevant sense.” (emphasis added)

[50] Mr Blackburn contends that there was no evidence to demonstrate that it was not reasonably practical for ISS to continue to provide suitable work to him and that as a result, the employer had contravened, or at least its action was not consistent with, the WRC Act. In addition, the applicant contends that the Commission should be mindful of approach taken by the Courts to the operation of s.58B of the WRC Act as illustrated by King CJ in Longyear v The Workers Rehabilitation and Compensation Corporation. 8 This approach was described by the Workers Compensation Tribunal (SA) in the following terms:

“131 King CJ made a number of relevant observations. The question was whether the employer should have offered clerical employment to a man who was no longer fit for his pre-injury duties as a fitter and turner. It was observed that the core obligation of s 58B was to provide “employment”, with that obligation being enlarged and defined by the adjective “suitable”. King CJ agreed with the contention that provision of causal employment would not discharge the employer’s obligation with respect to a disabled permanent employee, but observed that if it was not practicable to provide permanent employment, but was reasonably practicable to provide casual employment, the obligation under s 58B would not be fulfilled unless casual employment was provided. This is indicative of a broad approach to the scope of suitable employment which provides some support for the worker’s proposition that, even if the collection of duties done by the worker up to mid-2012 could not occupy him on a full-time basis, they should have been offered part-time at least.

132 Another observation of King CJ was that whether the qualification of reasonable practicability relieved an employer of the obligation to create a position providing suitable employment depended upon the circumstances. He rejected the employer’s submission that it could not be regarded as reasonably practicable to provide suitable employment if no suitable position was available in the sense of a suitable vacancy. Whilst the creation of a position might not be practicable for a small employer, King CJ observed that there may be little or no difficulty in finding appropriate tasks in a larger organisation. Again, this observation supports the worker’s contention that the compensating authority through Mr Zubrinich inappropriately narrowed the focus of his inquiry as to suitable employment”. 9

[51] Mr Blackburn further argues that he had no direct right of review under the WRC Act to the decision of ISS and EML to go down the NET path. 10

[52] ISS contends that the WRC Act was irrelevant for present purposes and that Mr Blackburn could have disputed the NET under the WRC Act, and did not do so. Further, ISS contends, in effect, that a finding about compliance with that Act was not the proper role for the Commission.

[53] In addition, ISS contends that in any event, a finding that the employer had contravened s.58B was not open based upon the facts. That is, the incapacity for work had continued for some 22 months and it was the common view of the medical advisers that there was little prospect of Mr Blackburn ever returning to his position.

[54] Given the Full Bench decision in J Boag, the potential operation of (in this case) the WRC Act is a relevant consideration in terms of whether there was a valid reason for dismissal. In my view, this would involve an assessment as to whether the actions of the employer were consistent with the requirements of that Act. 11 It would not however involve a purported finding that the employer had, or had not, breached the legislation. That is clearly a matter for a Court or Tribunal of competent jurisdiction.

[55] I will deal with the detail of that consideration in due course.

5. Was Mr Blackburn’s dismissal unfair within the meaning of the FW Act?

[56] Section 385 of the FW Act provides as follows:

“385 What is an unfair dismissal
(1) 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.”

[57] Mr Blackburn was dismissed, the employer is not a small business within the meaning of the FW Act, and the concept of a genuine redundancy is not relevant here.

[58] On that basis, the dismissal will be unfair if it is found to be harsh, unjust or unreasonable.

[59] The FW Act relevantly provides 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.”

[60] It is clear that s.387 of the FW Act contemplates an overall assessment as to the nature of the dismissal being made by the Commission. In so doing, the FW Act sets out a number of considerations that must, where relevant, be treated as a matter of significance in the decision making process and weighed up accordingly.

[61] It is convenient therefore to use the various provisions of s.387, with reference to the relevant circumstances, to outline my consideration of the matter.

Section 387(a) – whether there was a valid reason for the dismissal related to Mr Blackburn’s capacity or conduct (including its effect on the safety and welfare of other employees)

[62] Valid in this context is generally considered to be whether there was a sound, defensible or well-founded reason for the dismissal. Further, in considering whether a reason is valid, the requirement should be applied in the practical sphere of the relationship between an employer and an employee where each has rights, privileges, duties and obligations conferred and imposed on them. That is, the provisions must be applied in a practical, common sense way to ensure that the employer and employee are each treated fairly. 12

[63] I have earlier set out the parties’ submissions in terms of the WRC Act and its impact upon this consideration.

[64] ISS further contends that it is well established that a lack of capacity to perform the job can form the basis for a valid reason for dismissal. ISS submits that it is undisputed that Mr Blackburn was not capable of performing the inherent requirements of his pre-injury position, and this constituted a valid reason for dismissal. In that regard it submits that Mr Blackburn led no evidence to suggest that he was capable of performing his pre-injury duties or that his capacity had improved.

[65] In addition to his position arising directly from the WRC Act, Mr Blackburn also contends he was one of many “orderlies” employed by ISS and he was not in a unique position that required the role to be filled urgently. The injury had lasted for some period of time however it was contended that the treating specialist had indicated that the condition may improve. Mr Blackburn also contends that ISS, EML and the WorkCover Corporation did not arrange for a functional capacity assessment. This means that the information that ISS held in relation to Mr Blackburn’s ability to perform his duties was limited and the applicant contends that the circumstances did not give rise to a valid reason for termination.

[66] I have earlier set out the summary provided by the Full Bench in J Boag however the discussion leading to that point further illustrates the approach required. The Full Bench said:

“[22] When an employer relies upon an employee’s incapacity to perform the inherent requirements of his position or role, it is the substantive position or role of the employee that must be considered and not some modified, restricted duties or temporary alternative position that must be considered.

[23] In X v Commonwealth the High Court was concerned with an allegation of discrimination on the grounds of disability contrary to the Disability Discrimination Act 1992 (Cth) by a solider who had been dismissed from the army on account of being HIV positive. Section 15(4) of that Act contains an exemption from liability if the person “would be unable to carry out the inherent requirements of the particular employment”. Gummow and Haynes JJ addressed the notion of “inherent” requirements:

“[102] The reference to "inherent" requirements invites attention to what are the characteristic or essential requirements of the employment as opposed to those requirements that might be described as peripheral. …[T]he requirements that are to be considered are the requirements of the particular employment, not the requirements of employment of some identified type or some different employment modified to meet the needs of a disabled employee or applicant for work.”

[24] Although the High Court was concerned with the meaning of the expression “inherent requirements” in a statute, this analysis is equally applicable to a consideration of what constitutes the “inherent requirements” of a position as a valid reason for dismissal. Thus, in Hail Creek Coal Pty Ltd v CFMEU a Full Bench noted:

“[124] The phrase "inherent requirements" has been judicially considered to mean something that is essential to the position. [See generally X v The Commonwealth (1999) 200 CLR 177] To determine what are the inherent requirements of a particular position usually requires an examination of the tasks performed, because it is the capacity to perform those tasks which is an inherent requirement of the particular position. [Qantas Airways Ltd v Christie (1998) 193 CLR 280 at 304 per McHugh J] As her Honour Gaudron J said in Qantas Airways Ltd v Christie:

"A practical method of determining whether or not a requirement is an inherent requirement, in the ordinary sense of that expression, is to ask whether the position would be essentially the same if that requirement were dispensed with." [ibid. at 295]”

[25] In Qantas Airways Ltd v Christie Gaudron J, with whom Brennan CJ agreed, noted that the expression “inherent requirements”, in its natural and ordinary meaning “directs attention to the essential features or defining characteristics of the position in question.” Her Honour noted:

“[33] There may be many situations in which the inherent requirements of a particular position are properly identified as the characteristic tasks or skills required for the work done in that position. But that is not always so. In the present case, the position in question is that of captain of B747-400 aircraft flying on Qantas' international routes, a matter as to which there is no real dispute between the parties. To identify the inherent requirements of that position as "the characteristic tasks or skills required in being a pilot", as did Marshall J in the Full Court, is to overlook its international character.

[34] Moreover, the international character of the position occupied by Mr Christie cannot be treated as irrelevant simply because it derives from his contract of employment or from the terms and conditions of the industrial agreements which have, from time to time, governed his employment with Qantas. It is correct to say, as did Gray J in the Full Court, that an inherent requirement is something that is essential to the position. And certainly, an employer cannot create an inherent requirement for the purposes of s 170DF(2) by stipulating for something that is not essential or, even, by stipulating for qualifications or skills which are disproportionately high when related to the work to be done. But if a requirement is, in truth, essential, it is irrelevant that it derives from the terms of the employment contract or from the conditions governing the employment relationship.”

[26] Gaudron J also noted that the fact that a requirement is stipulated in an employment contract does not, of itself, direct an answer one way or another as to the question whether it is an inherent requirement of the particular position in question.

[27] McHugh J drew attention to the distinction between an employee’s job and their position:

“[72] In my opinion, however, there is a distinction between a person's job and a person's position and that distinction may sometimes prevent the Convention jurisprudence on Art 1(2) from being applicable. The term "a particular job" in Art 1(2) of the Discrimination Convention has been construed by reference to the preparatory work and the text of the Convention to mean "a specific and definable job, function or task" and its "inherent requirements" those "required by the characteristics of the particular job"[66]. A person's job is therefore primarily concerned with the tasks that he or she is required to perform. No doubt the term "job" is often used to signify a paid position of employment. But in the context of determining the requirements of a job, it seems more natural to regard the term as referring to particular work or tasks that the person must perform. A person's position, on the other hand, is primarily concerned with the level or rank from which he or she performs those tasks. Position concerns rank and status. What is required of a person's position, however, will usually require an examination of the tasks performed from that position. That is because the capacity to perform those tasks is an inherent requirement of the particular position.

[73] In most cases, the distinction between the requirements of a position and the requirements of a job will be of little significance. But it is a mistake to think that there is no distinction between "a particular position" and "a particular job". In some cases the distinction between the inherent requirements of a particular position and those of a particular job, although subtle, may be material. This is often likely to be the case where qualifications are concerned, particularly those qualifications that are not concerned with the physical or mental capacity to perform the tasks involved in the position. Thus to be an American born citizen is an inherent requirement of the position of President of the United States, but it is not an inherent requirement of the "job" of President if that term refers to the work done by the President.”

[28] McHugh J endorsed the proposition that “whether a requirement was an inherent requirement of a particular employment was a matter which should be determined according to the dictates of common sense and as a matter of objective fact rather than as a matter of mere speculation or impression.”

[67] In light of the decision in J Boag, when assessing whether an alleged incapacity to perform the inherent requirements of the job provides a valid reason for dismissal, the following considerations arise:

● An inability to perform the inherent requirements of a position will generally provide a valid reason for dismissal;
● A dismissal based on an incapacity to perform the inherent requirements of a position may not be valid reason for dismissal if the employee has a capacity to perform the inherent requirements of their job;
● The job to be considered is the (original) substantive job of the applicant and not the modified role that they may have been performing; and
● Consideration may also, where relevant, involve an assessment as to whether the actions of the employer were consistent with the requirements of applicable workers compensation legislation.

[68] In this case, Mr Blackburn’s substantive job required that he undertake various tasks including the manual handling of patients and equipment. At the time of his dismissal he was not able to undertake these tasks. He was however capable of, and did, perform many of the other parts of the job.

[69] It is evident from the medical evidence that is before the Commission that in the normal course the original back injury would have been expected to have improved or been resolved given the time since that injury occurred. It is also evident that Mr Blackburn’s depressive illness and related factors were a significant inhibitor.

[70] Dr Yau, via his report, and Dr Salagaras more directly, advised the case conference that there was a limited chance of Mr Blackburn’s injury improving significantly without a change in treatment. The suggestion of cortisone injections, which had some potential to impact upon the physical injury, was rejected by Mr Blackburn. In terms of the depressive illness, this had been subject to a number of interventions but only in recent times.

[71] ISS was aware that Mr Blackburn was suffering from a depressive illness and had been advised during the course of the case conference that his on-going employment was an important part of his wellbeing.

[72] In terms of the impact of the WRC Act, there would be little doubt that the work being provided up to the point of withdrawing the work was consistent with the requirements of s.58B(1)(a) of that Act. The question becomes whether it was reasonably practical for ISS to continue to provide that work for Mr Blackburn. Practical in this context would bring into consideration factors such as cost, the capacity of the business to provide suitable employment, and the utility and benefit of the work that was within the worker’s capacity.

[73] In effect, ISS contends that the largely negative prognosis in relation to Mr Blackburn’s full recovery is the discerning consideration. Indeed, other than the evidence about the supernumerary nature of the role during weekday shifts, the employer did little to demonstrate that it was not reasonably practicable to provide further work. This position is akin to demonstrating that it was, or may be, inconvenient and futile to provide further work, at least in terms of Mr Blackburn’s recovery.

[74] The approach adopted by the Court to s.58B of the WR Act outlined earlier in this decision involves a broad understanding of suitable employment for present purposes. This may, depending upon the circumstances, involve part-time or casual employment where there were sufficient meaningful duties that could be reasonably provided. This approach would appear to be broader than the requirements to demonstrate an incapacity to perform the inherent requirements of the applicant employee’s job as directly considered in J Boag.

[75] In the end it is not necessary in this case to attempt to fully resolve the difference in approach. This arises because I consider that the decision to dismiss Mr Blackburn was somewhat premature. That is, the only medical evidence considered was conditional and not conclusive. The capacity for additional treatment to deal with the depressive illness and/or the pain symptoms was not fully explored and a proper job analysis of the work that was available to be performed by Mr Blackburn given then existing work restrictions was not done.

[76] In that light, there were very real concerns about the likelihood of Mr Blackburn ever returning to full employment and there were questions about his capacity to perform the inherent requirements of his job. However, based upon the evidence that is before the Commission, there was insufficient foundation for that proposition.

[77] I have also considered three other factors relied upon by ISS. Firstly, it notes that EML had approved the “separation” of Mr Blackburn in the context of on-going income and other support. The support is a relevant consideration however the fact that EML, in effect, approved the dismissal cannot substitute for the Commission’s own assessment of the circumstances based upon evidence. Secondly, ISS notes that Mr Blackburn did not provide to the Commission medical evidence of his existing or “improved” capacity. In that regard, I note that there is no real dispute about Mr Blackburn’s lack of capacity to undertaken manual handling tasks and related activities and he gave direct evidence about the negative impact of the dismissal upon his mental health.

[78] Thirdly, ISS observed that Mr Blackburn did not take any action to dispute the separation and NET decision under the WRC Act. For reasons outlined earlier in this decision, I understand that a worker had, at the time, 13 no direct means of contesting such a decision. I also understand that a worker may have a capacity to initiate a dispute about a subsequent rehabilitation plan that might be based around a NET program.14 There is no direct evidence before the Commission about any rehabilitation program that may have been established for Mr Blackburn as part of the NET and this aspect was not put to him by ISS during these proceedings.

[79] Having considered all of the relevant circumstances based upon the findings of the Commission, I am on fine balance, not persuaded that there was a valid reason for dismissal.

Section 387(b) – whether Mr Blackburn was notified of the reasons for dismissal

[80] This consideration requires the Commission to assess whether the applicant concerned was relevantly notified of the reasons leading to the dismissal before that decision was taken. 15

[81] The evident purpose of this consideration is that notification of the valid reason to terminate must be given to the employee before the decision to terminate the employee is made and the notification needs to be in explicit and plain and clear terms.

[82] Mr Blackburn was informed that ISS was considering approaching EML in relation to a potential separation however he was not notified of the reasons for dismissal as contemplated by s.387(b) of the FW Act.

Section 387(c) – whether Mr Blackburn was given an opportunity to respond to any reason related to his capacity or conduct

[83] The relevant reasons are those arising from the valid reasons found by the Commission. This consideration is therefore directly related to the above discussion.

[84] This process contemplated by the Act does not require any formality and is to be applied in a common sense way to ensure the employee has been treated fairly. The question becomes whether Mr Blackburn was aware of the precise nature of the employer’s concern about his conduct and had a full opportunity to respond to these concerns. 16

[85] Mr Blackburn contends that he was not afforded an opportunity to respond. That is, he was not able to respond to the reasons for dismissal outside of the case conference.

[86] ISS contends that Mr Blackburn was advised of their inability to continue to provide suitable light duties at the case conference on 19 February 2015, and at this point the NET process was discussed. This was further confirmed to Mr Blackburn on 23 February 2015 and correspondence on 5 March 2015.

[87] ISS concedes that no further meeting was held with Mr Blackburn to discuss the potential or planned termination. ISS submits that EML was managing Mr Blackburn’s workers compensation claim and was in regular contact with him in regards to the NET. ISS further contends that the lack of opportunity was immaterial as his incapacity to perform the duties was not disputed and EML had approved the NET process. I note that ISS does not contend that any role played by EML met the requirements of s.387(c) of the Act. 17

[88] At the point of the case conference, ISS had not decided that it would decline to offer further work to Mr Blackburn and only foreshadowed that this was being considered. Mr Blackburn had the opportunity to raise his concerns with that prospect, however he was not given a real opportunity to respond to any final reasons leading to the dismissal decision prior to it being made.

Section 387(d) – any unreasonable refusal by the respondent to allow Mr Blackburn a support person

[89] There was no request for a support person by Mr Blackburn. Although the applicant contends that the absence of due process meant that this “right” did not arise, this particular consideration is concerned only with the refusal of a request.

Section 387(e) – if the dismissal is related to unsatisfactory performance by Mr Blackburn – whether he has been warned about that unsatisfactory performance before the dismissal.

[90] This consideration relates to performance of the job. Performance in this context includes the employee’s capacity to do the work, and the diligence and care taken with that work. 18

[91] There was no prior warnings and no disciplinary action of any kind involving Mr Blackburn however the dismissal was not related to unsatisfactory performance.

Section 387(f) – the degree to which the size of the respondent’s enterprise would be likely to impact on the procedures followed in effecting the dismissal.

Section 387(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.

[92] ISS is a large employer with human resource management specialists. This consideration does not arise in the case.

Section 387(h) - other matters considered to be relevant

[93] Amongst other considerations, the Commission should consider the impact of the dismissal upon the applicant given all of the circumstances. This includes consideration as to whether the dismissal was harsh in the sense that it was disproportionate to the actual circumstances found by the Commission. In terms of the impact of the dismissal upon Mr Blackburn, that impact has in this case been ameliorated to an extent by the on-going workers compensation payments and the employment services provided through the NET program.

[94] I also consider that the absence of contact by EML to Mr Blackburn advising that it had approached EML to pursue the NET option and the incorrect advice at the point of termination stating that the dismissal had, in effect, been approved by the WorkCover Corporation, are relevant factors in assessing the fairness of the dismissal.

Conclusion on nature of dismissal

[95] As outlined earlier, the Act requires a global assessment having regard to the various relevant statutory considerations. In that context, procedural unfairness is an important consideration, given the provisions of the Act but does not necessarily mean that the dismissal was unfair. This is reinforced by the objects of this Part the Act in s.381 including ss.(2) which provides as follows:

“(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.”

[96] As revealed in various decisions of the Commission (and the Court), each case must be considered in its own circumstances and it is appropriate, amongst other factors, to have regard to whether the procedural deficiencies made any difference to the outcome.¹⁹

[97] In my view, there were consequences of the timing and manner of the decision to dismiss Mr Blackburn, particularly in the context of his medical condition, the impact of the dismissal and elements of procedural unfairness outlined above. The applicant advised during the case conference that he was blind-sided; he was at the time suffering from a depressive illness where his connection to employment at ISS was considered to be very important by his Doctor and this was known by ISS; his Doctor and Psychologist sought that the decision making process be slowed; and Mr Blackburn was not then subsequently informed that an approach had been made to EML that might lead to his termination and was not at any point kept informed of the subsequent developments or given an genuine opportunity to be heard. In all of these circumstances, the dismissal was harsh and unreasonable.

[98] As a result, the dismissal was unfair within the meaning of the FW Act.

6. Remedy

[99] Division 4 of Part 3-2 of the FW Act relevantly provides as follows:

“Division 4—Remedies for unfair dismissal

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.

...

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. 20

(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.

393 Monetary orders may be in instalments

To avoid doubt, an order by the FWC under subsection 391(3) or 392(1) may permit the employer concerned to pay the amount required in instalments specified in the order.”

[100] The prerequisites of ss.390(1) and (2) have been met in this case.

[101] Section 390 makes it clear that compensation is only to be awarded as a remedy where the Commission is satisfied that reinstatement is inappropriate and that compensation is appropriate in all the circumstances. Mr Blackburn no longer seeks reinstatement and given all of the prevailing circumstances I accept that reinstatement would not be appropriate.

[102] As a result, I need to consider whether compensation is appropriate and if so, to what extent.

[103] Mr Blackburn sought the maximum compensation available under the Act. This position is based upon projected losses over a period of three years calculated according to the difference between his pre-dismissal earnings and the workers compensation payments he presently receives and subject to a significant contingency discount given the length of that projection. In addition, Mr Blackburn sought compensation for the difference between his annual leave entitlements (if he had remained in employment for the projected period) and his present payments and an amount for lost long service leave accruals. 21

[104] ISS contends that any compensation should be limited given the circumstances and contends that the employment would, in any event, conclude within weeks of the actual dismissal. ISS further contends that a reduction for contingencies is appropriate and that if the employment was projected for a significant period, this reduction should be in the order to 75 to 90 per cent. 22

[105] A recent Full Bench in McCulloch v Calvary Health Care Adelaide 23 (McCulloch) confirmed, in general terms, that the approach to the assessment of compensation as undertaken in cases such as Sprigg24 remains appropriate in that regard.

[106] Section 392(2) of the Act requires me to take into account all of the circumstances of the case including the factors that are listed in paras (a) to (g). Without detracting from the overall assessment required by the Act, 25 it is convenient to discuss the identified considerations under the various matters raised by each of the provisions.

The effect of the order on the viability of ISS

[107] Nothing has been put the Commission by ISS on this aspect and it is evident that any order that the Commission is able to make under this provision will not affect the viability of the employer.

The length of Mr Blackburn’s service with ISS

[108] Mr Blackburn was employed by ISS for just under eleven years.

The remuneration Mr Blackburn would have received, or would have been likely to receive, if he had not been dismissed

[109] This involves in part a consideration of the likely duration of Mr Blackburn’s employment in the absence of what I have found to be an unfair dismissal.

[110] The Full Bench in McCulloch also confirmed that when assessing likely lost remuneration, cogent evidence was required in relation to any prediction of a short period of future employment where the Commission had not found a valid reason for dismissal.²⁶ In this case I have found, on balance, that a valid reason did not exist and the unfairness was, in particular, compounded by the timing and procedural deficiencies associated with the dismissal. This must be weighed along with the nature and length of the employment and the applicant’s medical history and condition.

[111] In all of the evident circumstances it is reasonable to assess the compensation in this matter on the basis that the applicant would, on the balance of probabilities, have remained in employment for a further period of no more than six months. This assessment is informed by all of the relevant circumstances including the history and nature of the injury and its treatment, the nature and circumstances of the employment, the general operation of the WRC Act, and the likelihood of a dismissal taking place in that context.

[112] During his employment, Mr Blackburn received $985.19 per week made up of wages ($241.92) and workers compensation payments ($743.27). A payment of $93.60 per week was also made in the form of superannuation. This is the remuneration he would likely have received but for the termination. I will deal with the inclusion of the workers compensation component of this payment later in this decision.

[113] Accordingly, the provisional amount of lost remuneration is $25,618 in wages and compensation payments and $2,434 in superannuation.

The efforts of Mr Blackburn to mitigate the loss suffered by him because of the dismissal

[114] Given Mr Blackburn’s circumstances, no specific discount on the basis of mitigation is appropriate.

The amount of any remuneration earned by Mr Blackburn from employment or other work during the period between the dismissal and the making of the order for compensation

The amount of any income reasonably likely to be so earned by Mr Blackburn during the period between the making of the order for compensation and the actual compensation

[115] Mr Blackburn has not been employed since his dismissal but is in receipt of on-going workers compensation payments. The workers compensation payments are not being earned from employment and are not therefore relevant under these particular considerations.

Any other matter that the FWC considers relevant and the remaining statutory parameters

[116] I have taken into account the nature of the anticipated loss of remuneration over a period that has largely already taken place.Contingencies, in the sense of making specific provision for the potential for an earlier conclusion to the relationship, apply only to future loss.²⁷ Given these circumstances no further allowance for contingencies should apply.

[117] The workers compensation payments being received by the applicant since his dismissal do reduce Mr Blackburn’s actual losses, and having taken compensation payments into account in terms of the provisional loss calculation, it is appropriate to deduct them in reaching any final compensation figure.

[118] Mr Blackburn receives $936.86 per week in on-going workers compensation payments. This amounts to a deduction of $24,358 over the period of the projected employment.

[119] Mr Blackburn does not presently receive the benefit of superannuation contributions.

[120] There is no misconduct that should be taken into account as provided by s.392(3) of the Act.

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

[122] In the circumstances of this case, I consider that it is appropriate to have regard to other relevant factors in determining compensation. Firstly, the additional annual leave payments that would have occurred if the employment had continued for the projected period. That is, the difference between two weeks of annual leave payments and the normal payments allowed for in the projected lost earnings. This amounts to $878.00.

[123] Secondly, the additional 1.3 weeks of long Service Leave (LSL) that would have accrued with the projected employment figure. The additional LSL would have been paid out on termination and should be taken into account. This amounts to $1,522.

[124] The maximum compensation limit in this case would be the lesser of 26 weeks remuneration or $66,500.²⁸ Given the circumstances of the applicant, the relevant limit would be the total amount of remuneration received by Mr Blackburn, or to which he was entitled, for any period of employment with ISS during the 26 weeks immediately before the dismissal.

[125] Remuneration in this context is not defined in the Act. This would in my view include at least wages and superannuation payments. 29 However, even if restricted only to the wages component, the amount of compensation that would arise from my findings is less than that limit as applied in this case.30

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

[127] The compensation confirmed below is also appropriate having regard to all of the circumstances of this matter and the considerations specified by the Act.³¹

Conclusions on remedy

[128] After taking into account each of the relevant considerations, I find that compensation is appropriate in this matter. Further, I find that the compensation should be assessed having regard to the factors outlined above.

[129] The compensation will be as follows:

● Provisional compensation (excluding superannuation) $25,618

● Deduction for workers compensation payments received ($24,358)

● Adjusted compensation $1,260

● Add annual leave differential $878

● Add LSL accrual $1,522

● Final compensation (excluding superannuation) $3,660

● Plus superannuation $2,434

[130] Accordingly, I find that compensation in lieu of reinstatement should comprise a payment to Mr Blackburn by ISS of $3,660 plus superannuation of $2,434.

6. Conclusions and orders

[131] I have found that the Mr Blackburn’s dismissal was unfair within the meaning of the Act.

[132] I have found that reinstatement is inappropriate but that compensation of the amount determined above is appropriate in all of the circumstances.

[133] The payment of required compensation is to be made to Mr Blackburn by ISS within 14 days of this decision.

[134] An Order 32 to that end has been issued in conjunction with this decision.

COMMISSIONER

Appearances:

S Blewett of United Voice for Mr Blackburn.

J Moore, National General Manager Industrial Relations for ISS Health Services Pty Ltd.

Hearing details:

2015

Adelaide

11 August.

Final written submissions:

2015

13, 21 August.

1 Exhibit R2 – Witness Statement of Phillip Pizimolas – attachment PP1.

2 Exhibit R2 – Witness Statement of Phillip Pizimolas – attachment PP3

3 Exhibit R2 – Witness Statement of Phillip Pizimolas – attachment PP4

4 [2010] FWAFB 4022.

5 Selvachandran v Peteron Plastics Pty Ltd (1995) IR 371 at 373.

6 Ermilov v Qantas Flight Catering Pty Ltd (PR956925, Giudice J, Hamberger SDP and Raffaelli C, 4 April 2005) at [34].

7 Crozier, in the matter of an application for Writs of Certiorari and Mandamus against the Australian Industrial Relations

Commission [2001] FCA 1665 at par [14].

8 [1995] SASC 4951.

9 Lawless v Qantas Airways [2013] SAWCT 40.

10 Lawless v Qantas Airways [2013] SAWCT 40 at [73].

11 See also Arrowcrest Group Pty Ltd v Gill (1993) 46 FCR 90 and Ermilov v Qantas Flight Catering Limited PR953499 at [30] and on appeal at PR956925

12 Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371 as cited in Potter v WorkCover Corporation, (2004) 133 IR 458 and endorsed by the Full Bench in Industrial Automation Group Pty Ltd T/A Industrial Automation [2010] FWAFB 8868, at par [36].

13 I note that there may now be a right under legislation that replaced the WRC Act.

14 See Lawless v Qantas Airways [2013] SAWCT 40 at [66] to [104].

15 See Trimatic Management Services Pty Ltd v Daniel Bowley [2013] FWCFB 5160.

16 RMIT v Asher (2010) 194 IR 1. See also Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137 at par [75].

17 Transcript PN123.

18 See Anetta v Ansett Australia Ltd (2000) 98 IR 233.

19 See Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport AIRCFB Print S5897 per Ross VP, Acton SDP and Cribb C, 11 May 2000 and Villani v Holcim (Australia) Pty Ltd [2011] FCAFC 155 as examples.

20 Note: the subsection 392(5) amount was indexed to $133,000 from 1 July 2014 - as was relevant given the timing of this application.

21 Written submissions for the applicant – 13 August 2015.

22 Written submissions for ISS – 21 August 2015.

23 [2015] FWCFB 873.

24 Sprigg v Paul’s Licensed Festival Supermarket (1998) 88 IR 21. See also Bowden v Ottrey Homes Cobram and District Retirement Villages Inc T/A Ottrey Lodge[2013] FWCFB 431.

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

26 McCulloch at [27].

27 See the discussion of contingencies in McCulloch at [20] – [23]; Bowden v Ottrey Homes Cobram and District Retirement Villages Inc T/A Ottrey Lodge[2013] FWCFB 431, at par [52]; Ellawala v Australian Postal Corporation AIRC Print S5109, per Ross VP, Williams SDP and Gay C, 17 April 2000 and in Enhance Systems Pty Ltd v James Cox AIRC Print PR910779, per Williams SDP, Acton SDP and Gay C, 31 October 2001.

28 Section 392(5) of the Act.

29 I do not rule out the prospect that workers compensation payments could be included as remuneration for present purposes however it is unnecessary to determine that issue in this matter.

30 The compensation cap would be $6,290 (rounded).

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

32 PR572609.

Printed by authority of the Commonwealth Government Printer

Dennis Blackburn v ISS Health Services Pty Ltd