Dr Debbie Obatoki v Mallee Track Health & Community Services

[2015] FWC 3089

[2015] FWC 3089 [Note: An appeal pursuant to s.604 (C2015/4115) was lodged against this decision - refer to Full Bench decision dated 22 July 2015 [[2015] FWCFB 4758] for result of appeal.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Dr Debbie Obatoki
v
Mallee Track Health & Community Services
(U2014/6367)

COMMISSIONER CRIBB MELBOURNE, 7 MAY 2015

Application for relief from unfair dismissal.

[1] Dr Debbie Obatoki (the Applicant, Dr Debbie) has made an application under section 394 of the Fair Work Act 2009 (the Act) seeking an unfair dismissal remedy in respect of her dismissal by Mallee Track Health and Community Service (Mallee Track, the respondent).

[2] Mallee Track raised two jurisdictional objections in relation to the application. The first one concerned whether or not Dr Obatoki was an employee or a contractor. This objection was dealt with by Commissioner Blair who found 1 that Dr Obatoki was an employee. The second objection concerns whether there was a termination at the initiative of the employer or whether Dr Obatoki voluntarily resigned.

[3] It was agreed that the second jurisdictional objection, together with the merits of the matter, would both be dealt with at the same time. The Fair Work Commission (the Commission) would, in the first instance, however, determine the jurisdictional objection. If necessary, the Commission would then move to deal with the merits of the application and whether the dismissal was unfair.

[4] Hearings were held in Mildura on 24 and 25 November 2014 and Friday 30 January 2015. The Applicant filed her written closing submissions on 23 February 2015 with Mallee Track filing theirs on 6 March 2015. The Applicant provided her closing submissions in reply on 17 March 2015.

[5] Dr Debbie Obatoki was represented by her husband, Dr Victor Obatoki whilst Mallee Track was represented by Mr Benjamin Tallboys, lawyer.

[6] The first issue to be dealt with, therefore, is whether or not Dr Obatoki’s resignation was a termination at the initiative of the employee (constructive dismissal) or a voluntary resignation.

Constructive dismissal or voluntary resignation?

[7] There does not appear to be a major dispute between the parties about the chronology of events or the key facts of this matter. However, the parties seem to differ about the interpretation of those facts. This will be considered following a discussion of the factual matrix based on the relevant events which occurred.

(a) Chronology of events

(i) 11 December 2013

• There was a conversation between Dr Debbie and Mr Senior, Chief Executive Officer, on 11 December 2013, during which Mr Senior advised Dr Debbie that he had to stop paying her wages due to Dove Investments not having reimbursed Mallee Track for her wages for the past six months. 2



• Dr Debbie discussed what Mr Senior had said about Dove Investments owing money to Mallee Track with Dr Victor that night. Dr Victor confirmed that he had not reimbursed Mallee Track because he believed that Mallee Track owed Dove Investments a lot of money and Mr Senior was refusing to have a financial reconciliation undertaken.

(ii) 12 December 2013

• Dr Debbie e-mailed Mr Senior and advised that, following the conversation the day before about the sudden suspension of her salary, she had decided to resign. Dr Debbie also stated that she felt that she had been discriminated and demeaned. 3



• As part of resigning, Dr Debbie gave one month’s notice as she believed that the required notice period was one month. 4

(iii) 13 December 2013

[8] Mr Senior e-mailed Dr Debbie and sincerely apologised for suspending her salary. He stated that he had lifted the suspension on her salary and hoped that she would reconsider her decision to resign. 5 Mr Senior authorised payment of Dr Debbie’s salary through an off-line payment.6

(iv) 16 December 2013

• Dr Debbie e-mailed Mr Senior and stated that she greatly appreciated his apology and accepted it. Dr Debbie also indicated that she would not be withdrawing her resignation. The reason given was that she could not continue in the unhealthy working environment and relationship between Mallee Track and Dove Investments. 7



• Mr Senior replied to Dr Debbie’s e-mail and thanked her for her understanding and advice. 8

(v) 24 January 2014

• Mr Senior wrote to Dr Victor and advised him that, under Dr Debbie’s contract, Dr Debbie was required to give four months notice. 9



• Dr Victor replied, copying in, amongst others, Dr Debbie, stating that she was going to retract her resignation until he (Dr Victor) told her that he was no longer going to pay for a doctor (Dr Debbie) to provide services to Mallee Track. Dr Debbie then made the decision not to return to the employment relationship because she was concerned that it would invariably drag her into the protracted quagmire. 10

(vi) 15 February 2014

[9] Dr Debbie wrote to Mr Senior (copying in Dr Victor) to clarify the reasons why she did not withdraw her resignation. She stated that she had accepted his apology but, as she had stated in her previous letter, she was concerned that she would inevitably be drawn into the issues between Mallee Track and Dove Investments. She saw that there was only one option which was not to go back to the same contract. She was unaware that the required notice was four months but was willing to go back to working with Mallee Track for the notice period and beyond, if she was still needed. 11

(vii) 19 March 2014

• Dr Debbie wrote to Mr Senior withdrawing her resignation. 12



• Mediation commenced between Mallee Track, Dove Investments and Dr Victor.

(viii) 26 March 2014

• Mr Senior wrote to Dr Debbie advising that, given the effluxion of time since her resignation, Mallee Track needed to make a decision about whether it was appropriate to accept the withdrawal of her resignation. Dr Debbie was required to provide a range of information to Mallee Track to assist in making their decision. 13



• Dr Debbie responded to Mr Senior’s email and indicated that, if withdrawal of her resignation was an issue or discomfort for anyone, then he was not to accept the withdrawal. 14

(ix) 27 March 2014

[10] E-mails between Mr Senior and Dr Debbie regarding the withdrawal of her resignation. 15

(x) 1 April 2014

• Mr Senior e-mailed Dr Debbie and advised that Mallee Track was not consenting to the withdrawal of her resignation. Her contract would then automatically terminate on 12 April 2014 at the end of the notice period. 16



• Dr Debbie e-mailed Mr Senior and asked when her last fortnightly salary would be paid. 17

(xi) 6 April 2014

[11] Dr Debbie e-mailed Mr Senior stating that she had not received her salary and asking why it had been withheld. Dr Debbie also asked why her contract was terminated as a result of Mr Senior’s refusal to accept the withdrawal of her resignation. 18

(xii) 8 April 2014

[12] Mr Senior e-mailed Dr Debbie and indicated amongst other things that, in relation to her request for her wages, Dr Debbie’s wages had always been managed by Dove Investments and by her husband, Dr Victor.

(xiii) 11 April 2014

• Dr Debbie e-mailed Mr Erhardt, Chairman of the Mallee Track Health & Community Services Board asking what she had done wrong. She also expressed her feelings about her and Dr Victor’s time at Mallee Track. 19



• Mr Erhardt replied to Dr Debbie’s e-mail noting her intention to make a complaint to the FWC and denying any wrongdoing on behalf of Mallee Track. 20

(xiv) 12 April 2014

• Dr Debbie wrote to Mr Senior on her final day with Mallee Track. Amongst other things, Dr Debbie expressed the view that she had been singled out on the basis that all of the other Clinic staff had continued to be paid whilst she was the only one who wasn’t. 21



• Dr Debbie ceased employment with Mallee Track.

(b) Submissions

(i) On behalf of Dr Debbie

[13] It was submitted that Dr Debbie was forced to resign by a course of conduct by her employer as she had never intended to resign. Dr Victor stated that Dr Debbie would still be working at Mallee Track if her employer had not forced her resignation. 22 The Applicant argued that the course of conduct that led to Dr Debbie’s termination were both acts of commission and acts of omission.

[14] The acts of commission was said to be:

• Mr Senior repeatedly expressing the desire to have Dr Debbie’s employment transferred to another company.



• Dr Debbie being prevented from using her fuel card for the official car despite other Mallee Track staff having use of a fuel card.



• Mallee Track stopping Dr Debbie’s salary because Dr Victor owed money to Mallee Track.



• Mr Senior stopped the Applicant’s timesheets getting to her and he directed Dr Debbie’s concerns about her salary to her husband.



• Mr Erhardt’s evidence that they had stopped paying Dr Debbie because they could not afford her salary. 23



• In spite of Dr Debbie asking at least three times about her salary, Mr Senior ignored her requests until two days before the end of her employment.



• Mr Senior’s questions in relation to consideration of whether to allow Dr Debbie to withdraw her resignation were unreasonable and inappropriate. 24

[15] It was also contended that Mallee Track had failed to act in relation to Dr Debbie. This was said to have been:

• Mallee Track’s failure to address the Applicant's grave concerns regarding discrimination by Mr Senior despite these concerns having been tabled before the full Board of Mallee Track.



• Mallee Track’s and the Board's failure to investigate Dr Debbie’s complaint about a toxic working environment and failure to provide a safe and healthy work environment for Dr Debbie. 25

(ii) On behalf of Mallee Track

[16] On behalf of Mallee Track, Mr Tallboys submitted that, when the events leading up to Dr Debbie’s resignation were properly analysed, it was clear that Dr Debbie was not forced to resign. It was argued that only one event (Mr Senior’s advice to Dr Debbie that her pay was being suspended) provided a temporal reason for Dr Debbie’s decision to resign. However, Mallee Track contended that Dr Debbie was not forced to end her employment because of that decision. Mallee Track further argued that the Applicant’s reliance on events which took place after she had resigned demonstrated the weakness of the Applicant’s case. 26

[17] It was stated that the Applicant must persuade the Commission that Mallee Track’s conduct was intended to cause the Applicant's resignation or that it otherwise forced the resignation. Mallee Track submitted that Mr Senior did not intend for Dr Debbie to resign on 12 December 2013. Mr Senior’s evidence was referred to on the basis that he gave clear evidence that he never intended Dr Debbie’s resignation. Secondly, it was contended that Mr Senior would not have asked Dr Debbie to withdraw her resignation if that had been his intended conclusion. 27

[18] In relation to Dr Debbie’s reasons for her forced resignation, it was stated that only one reason had been referred to in her resignation e-mail ie. the suspension of her salary because Dove Investments was not reimbursing that salary. Mallee Track submitted that the Applicant, by her subsequent conduct, clearly did not regard the non-payment of wages as being incompatible with her continued employment. 28

[19] With respect to the Respondent’s argument that the non-payment of Dr Debbi’s salary was not itself sufficient to demonstrate that the resignation was forced, the Commission was referred to a number of previous decisions of the Commission on this topic. It was stated that a Full Bench in Bruce v Fingal Glen Pty Ltd (in liq) 29 found that, given that the applicant had other avenues available to pursue her grievance besides just complaining directly to her employer, the employee’s resignation was not the probable result of the conduct and therefore could not be characterised as a constructive dismissal.30

[20] It was contended that, in this matter, Dr Debbie had several options available to her before she had to resign. These were said to have been:

• Dr Debbie could have complained to Mr Senior, in person or over the telephone, about the suspension of her salary at any time prior to resigning but she did not do so. Dr Debbie could have told Mr Senior that she was not involved in Mallee Track’s arrangements with Dove Investments and that they were irrelevant in relation to her employment. 31



• Dr Debbie’s explanation that she was physically unable to complain to Mr Senior should not be accepted. The evidence was that Dr Debbie had been able to ask Mr Senior for the reasons and was also able to call Dr Victor after the meeting. Dr Victor’s evidence was said to not have supported Dr Debbie’s explanation. It was argued that the Applicant’s ability to work after the meeting with Mr Senior and to have at least two conversations with Dr Victor about her situation, suggested that Dr Debbie was not physically incapable of speaking to Mr Senior or that she was so affronted that she could not. 32



• Dr Debbie could have complained to Mr Senior in writing - which is what she did in her resignation e-mail. There was said to be no legitimate reason why Dr Debbie could not have e-mailed Mr Senior and challenged his actions and given him a chance to review the situation prior to resigning. This was said to be particularly so given that, what took place on 11 December 2013, stood out against four years of a previously uneventful employment relationship. It was stated that Dr Debbie chose not to. 33



• There was no evidence to support Dr Debbie’s contention that there was no point in complaining to Mr Senior because of her past dealings with him. The Applicant’s e-mails to Mr Senior, prior to April 2014, were described as not exhibiting any distrust or animosity towards him. 34



• There was no persuasive evidence that the Applicant had a legitimate perception, on 11 and 12 December 2013, that complaining to Mr Senior could not have achieved any useful outcome.



• There was no reason why Dr Debbie could not have complained to the Board of Mallee Track. No evidence was said to have been brought which explained why Dr Debbie believed there was no point on the basis of the Board’s past failure to address Dr Victor’s issues. It was stated that Dr Debbie was aware that Dr Victor was meeting with the Board on 16 December 2013 and that the meeting may lead to mediation being arranged. However, the Applicant had waited until 11 April 2014 to make contact with Mr Erhardt. This was said to have been after Mr Senior refused to allow Dr Debbie to withdraw her resignation. 35



• The Applicant could have sought advice or complained to the Fair Work Ombudsman or sued Mallee Track for her unpaid salary. 36

[21] In summary, Mallee Track submitted that the Commission should find that, whilst Mr Senior’s actions were wrong and whilst Dr Debbie’s response in resigning was understandable, these actions did not force Dr Debbie’s resignation as it was not the only reasonable option available to her. 37

[22] It was further contended that it should not be accepted the Dr Debbie was forced to resign due to the suspension of her pay. This was because Dr Debbie’s actions, after 12 December 2013, were said to be inconsistent with those of an employee who was sufficiently aggrieved by her employer’s actions that she was forced to end her employment. 38

[23] These actions were:

• Dr Debbie accepted Mr Senior’s apology but refused to withdraw her resignation. This was on the basis that there were ongoing issues between Dove Investments and Mallee Track. 39



• Dr Debbie gave one month’s notice and agreed to extend it to 4 months and then continued to work during the notice period, whilst not being paid. 40



• Dr Debbie waited until 1 April 2014 before asking about her fortnightly salary and that was then followed up on 6 April 2014. 41



• Dr Debbie and Dr Victor did not continue with the usual practice of Dr Debbie filling out timesheets with Dr Victor approving them and then forwarding them to payroll for processing. No evidence was given by either on this issue. 42



• Mr Senior’s evidence was that he had suspended Dr Debbie’s pay in early December 2013 and had reinstated it on 13 December 2013. 43



• There was no evidence to support Dr Debbie’s assertion that Mr Senior had prevented her from receiving timesheets. The Commission should accept that Dr Debbie’s timesheets continued to be generated by the payroll system and that it was more than likely that Dr Debbie received them. 44



• There is no evidence that either Dr Debbie or Dr Victor complained about the absence of timesheets for Dr Debbie. This was said to reinforce Mallee Track’s submission that Dr Debbie did not regard her pay as fundamental. 45



• Dr Debbie is seeking reinstatement despite Mr Senior’s actions in forcing the end of her employment and her being unpaid for four months. 46

[24] Mallee Track also contended that Dr Victor’s actions deserved comment. Various interventions by Dr Victor, on Dr Debbie’s behalf, were outlined. 47

[25] It was submitted that Dr Debbie’s inaction over continuing to not receive her salary was due to the fact that Dove Investments, and not Mallee Track, effectively paid her. Even if Dr Debbie was not being paid a salary by Mallee Track, it was stated that Dr Debbie and her family continued to enjoy the benefit of the fees generated by Dove Investments from her work at the Clinic without Dove Investments having to reimburse Mallee Track for Dr Debbie’s salary. Mallee Track argued that this explained Dr Debbie’s subsequent actions or non-actions and why she did not regard herself as forced to resign as a consequence. 48

Discriminated and demeaned

[26] Mallee Track contended that Dr Debbie did not resign because she had been singled out because she was the only Clinic staff person whose pay was suspended. It was stated that this complaint had been put into Dr Debbie’s mind by Dr Victor on the night of 11 December 2013. Mallee Track argued that the arrangement between Dove Investments and Mallee Track, in relation to Dr Debbie, were different to the reimbursement arrangement between Dove Investments and Mallee Track, in relation to the other staff. 49

Fuel card

[27] It was stated that Dr Debbie had said that one of the reasons she resigned was because she was the only Mallee Track employee not given a fuel card. As the evidence was said to support the submission that Dr Debbie had never complained about the non-provision of a fuel card outside of these proceedings nor had asserted a breach of her entitlements by not receiving that card, Mallee Track contended that this ground must also fail. 50

Working relationship between Mallee Track and Dove Investments

[28] Mallee Track argued that the complaint by Dr Debbie that she was forced to resign because of ongoing issues between Mallee Track and Dove Investments, was not mentioned in her resignation e-mail. It was acknowledged that it was mentioned in Dr Debbie’s subsequent e-mails of 16 December 2013 and 15 February 2014. 51

[29] It was stated that it was uncontested that there were issues with the working arrangements between Mallee Track and Dove Investments in 2013/2014. Mallee Track contended that there was insufficient evidence before the Commission to impose any responsibility or wrongdoing on either party to support a finding that the Respondent’s part in, and response to, those issues, forced Dr Debbie’s resignation. It was argued that there was no evidence that the relationship between Mallee Track and Dove Investments had impacted on Dr Debbie at work. Therefore, it could not be concluded that Mallee Track’s conduct in relation to Dove Investments, affected Dr Debbie’s working arrangements or forced her to resign. Dr Debbie’s evidence, where she said that the issues were between Dr Victor and Mr Senior and that she had nothing to do with Dove Investments, was highlighted. 52

[30] Mallee Track submitted that Dr Victor’s assertion that both Mr Senior and Mr Erhardt had failed to act on Dr Debbie’s complaints about the “toxic environment” must fail. This was because the complaint was made after Dr Debbie had already resigned and so could not therefore be the basis for her resignation three days earlier. In addition, it was argued that this allegation by Dr Victor was inconsistent with the evidence. Therefore, it could not be said that Mallee Track was ignoring the issues between it and Dove Investments - at any time. Rather, the Respondent contended that the ongoing issues between Mallee Track and Dove Investments played an operative role in Dr Debbie’s voluntary decision to resign. 53

[31] Finally, Mallee Track contended that the Applicant was unable to demonstrate any conduct by the Respondent, on or before the morning of 12 December 2013, that forced her resignation. Conduct which occurred after 12 December 2013 was said to not be relevant. This was because events after a resignation cannot convert that resignation into a forced resignation. Therefore, Dr Debbie was not dismissed within the meaning of sections 385 and 386 of the Act. 54

(c) Considerations and Conclusions

[32] Having set out the chronology of events and the relevant factual matrix, I now turn to the question to be decided.

(i) Legislative requirements

[33] Section 386 (1) (b) of the Act sets out the meaning of "dismissed". It is as follows:

“386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.......”

[34] The classic authority for guidance as to whether or not there has been a constructive dismissal is Mohazab v Dick Smith Electronics (No 2) 55 (Mohazab). In this decision, the Court expressed the view that:

“ In these proceedings it is unnecessary and undesirable to endeavour to formulate an exhaustive description of what is termination at the initiative of the employer but plainly an important feature is that the act of the employer results directly or consequentially in the termination of employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship.” 56

[35] Further, a Full Bench of the Australian Industrial Relations Commission, in O’Meara v Stanley Works Pty Ltd 57 (O’Meara), stated that:

“ In our view the full statement of reasons in Mohazab which we have set out together with the further explanation by Moore J in Rheinberger and the decisions of Full Benches of this Commission in Pawel and ABB Engineering require that there be some action on the part of the employer which is either intended to bring the relationship to an end or has the probable result of bringing the employment relationship to an end. It is not simply a question of whether "the act of the employer [resulted] directly or consequentially in the termination of employment." Decisions which adopt a shorter formulation of the reasons for decision should be treated with some caution as they may not give full weight to the decision in Mohazab. In determining whether a termination was at the initiative of the employer and objective analysis of the employer's conduct is required to determine whether it was of such a nature the resignation was the probable result was that the appellant had no effective or real choice but to resign.” 58

[36] I respectfully adopt this approach.

[37] It was common ground that Dr Debbie e-mailed Mr Senior, on 12 December 2013, and advised him of her decision to resign. In that e-mail, amongst other things, Dr Debbie stated that:

“After due consideration following our discussion yesterday over the sudden suspension of my salary I have decided to resign from MTH&CS.

I feel that I have been discriminated and demeaned.....” 59

[38] The discussion that Dr Debbie referred to, in her e-mail, occurred the day before, on 11 December 2013, between Dr Debbie and Mr Senior. During that conversation, Mr Senior advised Dr Debbie that he had to stop paying her salary as Dove Investments had not reimbursed Mallee Track for six months. Mr Senior’s purpose in suspending Dr Debbie’s pay was to bring the dispute between Mallee Track and Dr Debbie’s husband (Dove Investments) to a head. Mr Senior was clear that it was not his intention that Dr Debbie resign. 60 Dr Debbie’s evidence was also that Mr Senior had said that he hoped that they did not leave but that, if they did, they should look for a doctor before they go.61

[39] Mr Erhardt, Chairman of the Board, gave evidence about this as well and he agreed that Dr Debbie was collateral damage as a result of the dispute between Dove Investments and Mallee Track. It was his view that Mallee Track “were forced into a position that was an unfortunate position”. 62

[40] The following day (12 December 2013), Mr Senior wrote to Dr Debbie and sincerely apologised:

“I offer my most sincere apology for my action in suspending your salary, and, for the way I handled my communicating this to you.

I realise, after much soul searching this last 24 hours, that I cannot excuse myself and should have shown you the respect you rightly deserve and not involved you in financial matters or shared with you my concerns. I hope you can forgive me....”. 63

[41] Mr Senior’s letter also advised that he had lifted the suspension on Dr Debbie’s salary and that he hoped that she would reconsider her decision to resign. 64

[42] On Monday, 16 December 2013, Dr Debbie replied stating that Mr Senior’s apology was greatly appreciated and accepted. Dr Debbie also indicated that:

“It is clear to everyone that the working environment and relationship between MTHCS and Dove investment has been very unhealthy for months now. I do not know the reason for this. But I do not think I can continue in that environment. And for this reason I shall not be withdrawing my resignation from MTHCS. Ultimately, it really does not make any difference since Dove Investments pays me ultimately.” 65

[43] In relation to the reasons for her resignation, it was Dr Debbie’s evidence that:

• She was being discriminated against because she was being tied to her husband who was in dispute with Mallee Track.



• She is a fellow (Doctor) in her own right with her own patients whom she sees on her own authority.



• Mr Senior made her feel that she was nothing by telling her that he had to stop her pay. 66



• When Mr Senior told her that he had to suspend her pay, she lost her faith that everything will be fine. 67



• Mr Senior did not give her an option, other than to stop her salary. 68



• Mr Senior was going to drive her away and would look for someone to replace her - therefore, he did not care. 69



• The sudden suspension of her salary was part of being forced. 70

[44] With respect to the reason why she did not withdraw her resignation, Dr Debbie explained that she did not want to get involved in/drawn into the issues between Mallee Track and Dove Investments and that that was a major concern at the time. 71 She said that she could not continue working at Mallee Track in the current unhealthy environment.72 The last sentence in Dr Debbie's e-mail of 16 December 2013 was explained to be her giving back to Mr Senior what he had told her i.e. that her pay comes from her husband and that she was not important because Mallee Track did not pay her.73

[45] In terms of Mr Senior’s response, dated 16 December 2013, to her e-mail, it was Dr Debbie’s understanding that, if Mr Senior had really wanted her to come back to work, he would have indicated that Mallee Track was trying to deal with the issue. On the basis that the e-mail did not say that, Dr Debbie took Mr Senior to be saying that he was happy with the way things were; was not concerned about her safety or her emotional state and that he did not care. 74

[46] Both Dr Debbie and Mr Senior gave evidence that Mr Senior’s apology of 13 December 2013 was genuine. It was also Mr Senior’s evidence that it was not his intention that Dr Debbie resign. 75 He noted that Dr Debbie had written to him and had accepted his apology.76 He believed that he had not made any comment or taken any action that was discriminating or demeaning towards Dr Debbie.77 Mr Senior explained that he was hoping that the resignation would be withdrawn but that did not happen. This was because Dr Debbie confirmed that she was not interested in being dragged into the quagmire of the arrangements between Dove Investments and Mallee Track.78 Mr Senior stated that Dr Debbie was not being singled out as she believed, because, at the time, she was on a Visiting Medical Officer (VMO) contract.79

[47] Mr Senior’s evidence that, in advising that Dr Debbie that he had to stop her pay, he did not intend to cause Dr Debbie to resign, is accepted. Mr Senior’s motivation for taking this action was said to have been to put pressure on Dove Investments so that things came to a head in relation to the financial dispute between Dove Investments and Mallee Track. It is acknowledged that Mallee Track, at that time, believed that Dr Debbie was a VMO. However, from the Commission’s perspective, Dr Debbie was an employee of Mallee Track. The action, therefore, that Mallee Track took, was to stop the pay of an employee in order to put pressure on an external third party (and her husband) to resolve their dispute with Mallee Track. There is no evidence before me that Dr Debbie was involved in this dispute or that she was involved in Dove Investments on a day-to-day basis or that she was aware, at all, or at any time, of the actions of Dr Victor/Dove Investments in relation to the dispute with Mallee Track.

[48] As was indicated during the last day of hearing, it was the Commission’s view that Dr Debbie was collateral damage in the dispute between Dove Investments and Mallee Track. This was acknowledged by Mr Senior and Mr Erhardt. It is my view that, suspending an employee’s pay in order to force resolution of a dispute with an external contractor, would meet the test of having “the probable result of bringing the employment relationship to an end”. I am also of the view that, if Mallee Track had not taken that course of action, Dr Debbie would have remained in the employment relationship.

[49] A constant theme throughout all of the e-mails from Dr Debbie was the toxic relationship between Mallee Track and Dove Investments and how she did not want to get drawn into it. The suspension of Dr Debbie’s salary was directly related to that relationship (the result of the between Mallee Track and Dove Investments) and was motivated by Mr Senior’s desire to put pressure on Dr Victor to resolve the dispute between the two parties. The reason for the suspension was not the result of any lack of work performance or conduct issues on the part of Dr Debbie.

[50] It is not possible to uncouple the two facts - the reason why Mr Senior suspended Dr Debbie’s salary and Dr Debbie not wanting to get drawn into that relationship (dispute). That is, for neither party, it was not just about the suspension of Dr Debbie’s salary. For Dr Debbie, it was about her being targeted by her employer because of the fight it was having with Dr Victor (her husband) who was not an employee of Mallee Track. For Mr Senior, it was about putting pressure on Dr Victor to resolve the dispute by suspending his wife’s salary. In writing that she was discriminated against, Dr Debbie appears to have been referring to the fact that she was the only Clinic staff member whose salary was suspended. By saying that it was demeaning, Dr Debbie seems to have been saying that she was a doctor in her own right but she was being used as a pawn in the fight between Mr Senior and Dr Victor and Mr Senior (her employer) was showing no regard for her well-being.

[51] The Respondent highlighted Dr Debbie’s evidence where she stated that, once the employee/employer relationship ended, she would then become a contractor and work for her husband. It needs to be noted that this evidence was about the day before her employment ended. It should not be forgotten that Dr Debbie tried to withdraw her resignation on 19 March 2014. Further, the relationship between Dr Debbie and Mr Senior was at a very low point by this time (11 April 2014).

[52] In relation to Mallee Track’s contentions that Dr Debbie had other options other than to resign, I accept Dr Debbie’s evidence that she was physically unable to complain to Mr Senior and that she was so affronted by what he had said. Dr Debbie was a credible witness and was clearly very averse to getting drawn into the quagmire. The person she would have been challenging (Mr Senior) was in conflict with her husband. Given that she was very emphatic about not getting drawn into that fight, it was not a real or viable option for Dr Debbie to have complained to Mr Senior about the suspension of her pay prior to resigning. This was particularly so when the reason for suspending her pay was directly related to the toxic relationship that she was desperately trying to avoid being drawn into.

[53] Same goes for Dr Debbie complaining to the Board plus Dr Debbie was aware of the Board and that Dr Victor was meeting with the Board on 16 December 2013 and that mediation might be arranged as a result. It was the applicant’s evidence that, after she had resigned, she was hopeful that the mediation would resolve her concerns. If Dr Debbie was hopeful that something positive would come out of the Board/mediation, it would be unlikely that she would want to rock the boat by complaining. Further, given the circumstances, it is not reasonable to expect that Dr Debbie would contact the Fair Work Ombudsman or sue Mallee Track in the courts.

[54] With respect to the various authorities the Commission was referred to by the Respondent, this matter is distinguishable from those decisions. This is because in this case, the suspension of Dr Debbie’s pay was only part of the reason she believed she had no other option but to resign. The other component concerned Dr Debbie trying to avoid being drawn into the dispute between her husband and her employer. This type of situation was not part of the factual matrix in the decisions referred to.

[55] Taking all of these considerations into account, I have formed the view that there were no other reasonable options available to Dr Debbie but to resign. This is because the suspension of Dr Debbie’s pay was inextricably linked to the dispute between her husband and Dove Investments and her employer - Mallee Track. Given that nexus, the usual range of possible options was not available to Dr Debbie. This was due to the possibility that, if Dr Debbie had taken any other action, it could potentially have had “external” repercussions which could have seen Dr Debbie drawn into the “toxic relationship”.

[56] In relation to Dr Debbie’s actions after 12 December 2013, it was Dr Debbie’s evidence that she believed that she had to give notice and she thought that it was one month. Dr Debbie was subsequently told by Mr Senior that the notice period was four months and Dr Debbie agreed to working that period of notice. Dr Debbie also stated that she was encouraged to keep working and was never told not to work. They also did not say that they were not going to fix things and so she had kept on working. 80

[57] With respect to the issue regarding the timesheets, on the final day of the three-day hearing, some of Dr Debbie’s timesheets were discovered by Mallee Track, in the Practice Manager’s scrap paper file. It is curious that they were finally found. It was Dr Debbie’s evidence that she did not receive any timesheets after December 2013. I accept Dr Debbie’s evidence that she did not receive timesheets. If she had received them, it would have seemingly been in her interests to have completed them. The ones that were discovered in the scrap paper pile had not been completed. Mallee Track was unable to provide any explanation as to how Dr Debbie’s timesheets turned up in the scrap paper pile. I accept Dr Debbie’s evidence that she sent an email complaining about not having been paid together with three letters over March/April 2014. 81

[58] On this basis, therefore, I find that Dr Debbie did not voluntarily resign but that the course of conduct by Mallee Track, on 11 December 2013, brought the employment relationship to an end and Dr Debbie had no effective or real choice but to resign.

[59] Accordingly, the Respondent’s jurisdictional objection is dismissed. The Commission will now proceed to deal with the substantive application.

Was the dismissal harsh, unjust or unreasonable?

(a) Legislative requirements

[60] Section 396 of the Act sets out four matters which must be decided in applications of this kind before the merits are considered. These matters are:

“(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.”

[61] The application was made within the period required in section 394(2) and Dr Debbie was covered by either an award or an agreement and therefore, was protected from unfair dismissal (s.396(b)). Sections 396(c) and (d) have no relevance in this matter.

[62] Section 385 of the Act provides that a person has been unfairly dismissed if the Fair Work Commission 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.”

[63] In this matter s.385(a) has been met. Subsections 385(c) and (d) have no relevance.

[64] Therefore, what remains to be determined is whether or not Dr Debbie’s dismissal was harsh, unjust or unreasonable (section 385(b)).

[65] In order to determine whether Dr Debbie’s dismissal was harsh, unjust or unreasonable, the Commission is required to take into account the factors set out in section 387 of the Act.

[66] Those factors are as follows:

“387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

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

(b) whether the person was notified of that reason; and

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

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

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

[67] I will deal with each of the factors in turn.

[68] It was conceded by the Respondent, during the hearing and in their closing submissions, that, if the Commission found that Dr Debbie was forced to resign then the Commission was also entitled to find that the dismissal was harsh, unjust or unreasonable. 82 I concur with this view. However, it is still necessary for the Commission to have regard to the factors set out in section 387 of the Act.

Sections 387(a), (b), (c) and (e)

[69] It was submitted that these factors are not relevant as a forced resignation will not be related to an Applicant’s capacity, conduct or performance. The Commission agrees with this submission and therefore finds that these factors are not relevant in this matter. 83

Section 387 (d) - support person

[70] The Respondent stated that it did not unreasonably refuse the Applicant a support person. 84 There is no evidence before me which indicates that Dr Debbie requested a support person. Therefore, I find that Mallee Track did not unreasonably refuse a request for a support person.

Section 387 (f) - the Respondent’s size

[71] It was submitted by Mallee Track that it is a health service in a remote community with approximately 250 employees. It was argued that this is a neutral factor. 85 I accept Mallee Track’s contention that this is a neutral factor in this matter.

Section 387 (g) - human resources expertise

[72] Mr Senior gave evidence that Mallee Track does not have dedicated human resource specialists or expertise. It was contended that this would have impacted on Mr Senior’s and the Respondent’s, ability to obtain appropriate advice at the time of any forced resignation on 12 December 2013. 86

Section 387(h) - Other matters

[73] Mallee Track argued that, despite the decision to suspend Dr Debbie’s pay being wrong, there still was a valid reason for Mallee Track to terminate Dr Debbie’s employment. This was because Mallee Track had effectively decided, in December 2013, that it could no longer afford, and therefore no longer required, Dr Debbie’s employed position. The available and appropriate course of action for Mallee Track was therefore to make Dr Debbie’s position redundant. It was stated that, during Mr Senior’s evidence, Mr Senior conceded, with the benefit of hindsight, that this is what he should have done. The failure on the part of Mallee Track was said to, accordingly, lie in the unfairness of the approach in dealing with the above circumstances and not in the ultimate outcome, namely, the termination of Dr Debbie’s employment. 87

(b) Conclusions

[74] In all of the circumstances of this matter, and having taken account of each of the factors in section 387(3) of the Act, I find that Dr Debbie’s dismissal was harsh, unjust and unreasonable.

(c) Remedy

[75] Section 390 of the Act sets out when the Fair Work Commission may order a person’s reinstatement or payment of compensation for unfair dismissal. It is as follows:

“390 When the FWC may order remedy for unfair dismissal

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

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

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

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

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

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

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

[76] With respect to the requirements of section 390, I am satisfied that Dr Debbie was protected from unfair dismissal at the time of her dismissal (section 390(1)(a)) and that she has been unfairly dismissed (section 390(1)(b)). Further, Dr Debbie has made an application under section 394 of the Act (section 390(2)).

(i) Reinstatement

[77] Section 390(3) states that the Fair Work Commission must not order the payment of compensation unless two conditions have been met. The first condition is that the Commission is satisfied that reinstatement is inappropriate (section 390(3)(a)).

[78] Dr Debbie did not give any oral evidence in relation to remedy. In the Applicant’s written submissions, reinstatement was sought or, in the alternative, the maximum compensation. 88 On behalf of the Applicant, it was strongly argued that the primary remedy of reinstatement should be awarded to Dr Debbie. Detailed reasons were given as to why the remedy should be reinstatement rather than compensation.89

[79] On the other hand, Mallee Track equally strongly opposed an order for reinstatement. This was on the basis that reinstatement would be inconsistent with the whole premise of the Applicant’s forced resignation; that there has been a mutual breakdown in trust and confidence and that Dr Debbie would have been made redundant in any event. 90

[80] I have carefully considered the submissions of the parties on this issue. Taking all of the circumstances of this case into account, I am satisfied that reinstatement of Dr Debbie is inappropriate. I accept Mallee Track’s submissions that there has been a mutual breakdown in trust and confidence between Dr Debbie and Mr Senior. However, more importantly, to return Dr Debbie to the situation that caused her to resign in the first place, in the absence of any evidence that the working relationship between Mallee Track and Dove Investments has been resolved, is unconscionable.

(ii) Compensation

[81] Section 390(3)(b) requires that the Fair Work Commission consider it appropriate, in all of the circumstances of the case, to order compensation. Taking into account all of the circumstances of this matter, an order for payment of compensation is considered appropriate. Section 392(2) of the Act sets out the criteria for deciding the amount of compensation in all of the circumstances of the case. These criteria are:

“(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.”

[82] I will deal with each of the criteria in turn, guided by the Full Bench decision in Haigh v Bradken Resources Pty Ltd 91 (Haigh).). In Haigh, the Full Bench also referred92 to the Full Bench decisions which have applied the approach in Sprigg v Paul Licensed Festival Supermarket93 (Sprigg). I respectfully adopt the approach taken in Haigh.

Section 392(2)(a) - effect on the viability of the employer’s enterprise

[83] It was submitted, on behalf of Mallee Track, that an order for compensation would not affect the viability of the Respondent’s enterprise.

Section 392(2)(b) - Applicant’s length of service

[84] Dr Debbie was employed by Mallee Track for four years and 10 months.

Section 392(2)(c) - remuneration likely to have been received

[85] Mallee Track argued that Dr Debbie would have been dismissed, by reason of redundancy, no later than 31 January 2014, had she not already given notice she was resigning. Dr Debbie’s employment would therefore have ended no later than 21 February 2014. Even if redundancy entitlements were taken into account (eight weeks), Dr Debbie would have been compensated to 18 April 2014. As her employment ended on 12 April 2014, Dr Debbie’s actual claim for compensation could only be for the period from 12 April to 18 April 2014 (six days) which was said to equate to $1,198.76. In addition, the Respondent submitted that any order of compensation should be subject to a deduction on account of contingencies. 94

[86] It is clear from the evidence that Mallee Track was not in a position, at any stage, to pay Dr Debbie a salary if that salary was not then being reimbursed by Dove Investments. Mr Senior’s comments about the likelihood of Dr Debbie having been made redundant in January 2014, had she not resigned in December 2014, are noted. However, I have not been convinced that this decision would have been actually made in the event that Dr Debbie had not resigned. Mr Senior’s comments appear to be theoretical and convenient and at odds with asking Dr Debbie to reconsider her resignation and later, insisting that she work out a 4 month notice period. Had Mr Senior not dealt with the dispute between Dove Investments and Mallee Track the way that he did on 11 December 2013, it is my view that Dr Debbie would have continued to work for at least another 12 months. Dr Debbie was clearly very committed to her patients and to the community and it would have been unlikely for her to have left her employment of her own accord.

[87] Therefore, for the purposes of the calculations, in accordance with the Sprigg principles, it is determined that the remuneration likely to have been received by Dr Debbie would have been 12 months.

[88] This results in a provisional amount of $72,483.32 (52 weeks x $1,393.91). The average weekly salary is based on the figures provided by Mallee Track. 95

Section 392(2)(d) - efforts to mitigate loss

[89] Dr Debbie gave evidence that, as at 24 November 2014, she was working at the Onyx Medical Centre. This suggests that Dr Debbie has sought to mitigate her loss.

Section 392(2)(e) - remuneration earned and income reasonably likely to be earned (section 392 (2)(f))

[90] There is no material before the Commission in relation to the remuneration earned by Dr Debbie during the period of anticipated employment, namely, between 13 April 2014 and 12 April 2015. Therefore, Dr Debbie it is directed to provide, to the Commission and to the Respondent, the amount of any remuneration earned between 13 April 2014 and 12 April 2015, together with supporting documentation. The information is to be provided by close of business on Tuesday 9 June 2015.

Section 392(2)(g) - other matters

[91] Mallee Track submitted that the Commission shall take into account the generous notice period of four months in making any order of compensation. It was stated that the fact that Dr Debbie was not paid during this period should not be held against Mallee Track as Dr Debbie was said to have made no attempt to facilitate Mallee Track paying her by clarifying her actual working hours. 96

[92] Having considered the Respondent’s submissions, the Commission has not been persuaded that this matter is relevant to the Commission’s considerations.

Section 392(3)

[93] This section is not relevant in relation to this matter.

Contingencies and taxation

[94] It was submitted by the Respondent that there should be a deduction of between 20% and 25% for contingencies. As the anticipated period of employment has only recently passed, it is proposed to make a deduction of 20% for contingencies.

[95] The impact of taxation has been considered and a gross amount will be settled on.

Section 392 (4) - shock or distress

[96] No part of the provisional compensation amount relates to any shock or distress suffered by Dr Debbie.

[97] With respect to section 393 of the Act, there were no submissions that any amount of compensation should be subject to payment by instalments.

[98] Once the information requested from the Applicant is to hand, it will then be possible to finalise determination of the amount of compensation in lieu of reinstatement. A further decision, and order, in regard to compensation will then be issued.

Appearances:

Dr Victor Obatoki for the Applicant

Mr Benjamin Tallboys of Russell Kennedy Lawyers for the Respondent

Hearing details:

2014.

Mildura:

November 24, 25.

2015.

Mildura:

January 30.

Final written submissions:

Applicant, 23 February 2015

Respondent, 6 March 2015

Applicant, 17 March 2015

 1   [2014] FWC 5967

 2   Transcript PN 707 - 708 and 3044, Exhibit A3 at paragraph 8 and Exhibit R3 at paragraph 33

 3   Exhibit R5 at Attachment M at pages 38 - 39

 4   Transcript PN 912 - 915

 5   Exhibit R5 at Attachment M at pages 37 - 38

 6   Ibid at Attachment O at page 31 and Transcript PN 4021 - 4031

 7   Ibid at attachment M at page 37

 8   Ibid

 9   Ibid at Attachment S at page 46

 10   Ibid at page 48

 11   Ibid at Attachment T at page 50

 12   Ibid at Attachment U at page 54

 13   Ibid at Attachment V at page 60

 14   Ibid at page 59

 15   Ibid at pages 58 - 59

 16   Ibid at page 58

 17   Exhibit A8

 18   Exhibit A9

 19   Exhibit R5 at Attachment V at page 61

 20   Exhibit A6 at page 92

 21   Exhibit R5 at pages 63 - 64

 22   Closing Submissions on behalf of the Applicant, 23 February 2015, at page 1

 23   Ibid at page 2

 24   Ibid at page 3

 25   Ibid at pages 3 - 4

 26   Respondent’s Closing Submissions, dated 6 March 2015, at paragraphs 9 - 10

 27   Ibid at paragraph 16 - 17

 28   Ibid at paragraph 21

 29   [2013] FWCFB 5279

 30   Respondent’s Closing Submissions, dated 6 March 2015, at paragraph 24

 31   Ibid at paragraph 25(a)

 32   Ibid at paragraph 25(b)

 33   Ibid at paragraph 25(c)

 34   Ibid

 35   Ibid at paragraph 25(g)

 36   Ibid at paragraphs 25(h) and (i)

 37   Ibid at paragraph 25(l)

 38   Ibid at paragraph 26

 39   Ibid at paragraph 27(a)

 40   Ibid at paragraphs 27(b) - (e)

 41   Ibid at paragraph 27(g)

 42   Ibid at paragraph 27(h)

 43   Ibid

 44   Ibid

 45   Ibid

 46   Ibid

 47   Ibid at paragraph 29

 48   Ibid at paragraph 32

 49   Ibid at paragraphs 34 - 38

 50   Ibid at paragraphs 39 - 45

 51   Ibid at paragraphs 46 - 47

 52   Ibid at paragraphs 48 - 49

 53   Ibid at paragraphs 51 - 54

 54   Ibid at paragraphs 55 - 56

 55 (1995) 62 IR 200

 56   Ibid at pages 205 - 206

 57   (2006) 58 AILR 100

 58   Ibid at [23]

 59   Exhibit R5 at attachment M

 60   Transcript PN 707 - 708 and 3044 and Exhibit R3 at paragraph 40

 61   Ibid PN 466

 62   Ibid PN 4759 - 4760

 63   Exhibit R5 at Attachment M

 64   Ibid

 65   Ibid

 66   Transcript PN 866

 67   Ibid PN 465

 68   Ibid PN 496

 69   Ibid PN 466

 70   Ibid PN 814

 71   Ibid PN 962 - 965

 72   Ibid PN 902 - 905

 73   Ibid PN 908

 74   Ibid PN 907 - 909

 75   Ibid PN 3088, 3101 and 3834

 76   Ibid PN 3838

 77   Ibid PN 3086

 78   Ibid PN 3087

 79   Ibid PN 3836

 80   Ibid PN 1128

 81   Ibid PN 995 - 997

 82   Respondent’s Closing Submissions, dated 6 March 2015, at paragraph 57

 83   Ibid at paragraph 59

 84   Ibid at paragraphs 60

 85   Ibid at paragraph 61

 86   Ibid at paragraph 62

 87   Ibid at paragraph 64

 88   Exhibit A1 at paragraphs 21 - 22 and Closing Submissions on behalf of the Applicant, dated 23 February 2015, at paragraphs 1 - 19 on pages 5 - 7

 89   Ibid at paragraphs 7 - 17 on pages 5 - 7

 90   Respondent's Closing Submissions, dated 6 March 2015, at paragraphs 66 - 76

 91   [2014] FWCFB 236

 92   Ibid at [10] - [12]

 93 (1998) 88 IR 21

 94   Respondent’s Closing Submissions, dated 6 March 2015, at paragraphs 85 - 88

 95   Ibid at paragraph 81

 96   Ibid at paragraph 94

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