Emmanouil Kalioros v AC Demolition and Services Pty Ltd T/A AC Demolition

[2017] FWC 2751

[2017] FWC 2751

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Emmanouil Kalioros

v

AC Demolition and Services Pty Ltd T/A AC Demolition

(U2017/38)

Deputy President Bartel ADELAIDE, 18 MAY 2017

Application for an unfair dismissal remedy.

[1]       Emmanouil Kalioros (the applicant) was engaged as an excavator operator. He commenced employment as a casual in May 2015 and was subsequently engaged in a permanent full time capacity on 14 October 2015. He was dismissed via a text message from the respondent’s Supervisor, Mr Mark Kerrison, on 23 December 2016.

[2]       The business of AC Demolition and Services Pty Ltd (the respondent) is the demolition of residential and small commercial buildings and the removal of rubble. At the time of the applicant’s dismissal the respondent employed 16 employees, including a number of casual labourers working 30 to 40 hours per week, truck drivers and part time administration staff. I am satisfied that the respondent is not a “small business employer” as defined in s.23 of the Fair Work Act 2009 (the Act).

[3]       The reason for dismissal cited by the respondent was that the applicant had caused damage to structures at a number of properties and damage to the respondent’s excavator. The respondent provided a list of residential addresses at which the damage allegedly occurred.[1]

[4]       The applicant gave evidence and there were two witnesses for the respondent, Mr Andrew Dean, owner, and Mr Kerrison. A significant portion of the evidence addressed the particulars and circumstances pertaining to the damage at these locations. The witnesses also addressed the procedural aspects of the dismissal, on which there is no dispute, and whether the applicant received prior warnings regarding damage to property, which is contested.

[5]       There is no documentation relating to the applicant’s engagement or his position and no documents pertaining to operational procedures such as job sheets, incident reports or records of work completed. Accordingly, findings of fact in relation to the circumstances of the damage at the sites identified by the respondent, is based solely on the oral evidence of the witnesses.

[6]       The applicant is a person protected from unfair dismissal[2] and there are no jurisdictional or other impediments to the unfair dismissal application being heard and determined on the merits. The matter proceeded by way of a determinative conference.

The alleged site damage

[7]       The circumstances of the alleged damage at each site are set out below.

Blackler Street, Plympton Park (late July 2016):[3]

[8]       It is agreed that a wall of the house being demolished was unstable, and as it was struck by the excavator some of the wall bricks hit a besser brick fence adjoining the neighbour’s property. The besser bricks in the fence were dislodged and damaged a car parked in the driveway of the adjoining property.

[9]       The applicant stated that he was aware that the wall was unstable but that neither he nor the spotter[4] could see the particular areas of weakness in the wall. It was his view that the situation was unavoidable.

[10]     Mr Dean stated that it is up to the operator and the labourer to inspect the site and assess the dangers before demolition work commences. If potential dangers/weaknesses are apparent then discussions can occur with the relevant parties and/or alternative ways of approaching the job can be considered. Mr Dean acknowledged that things can and do go wrong from time to time but in the applicant’s case it was too frequent.

[11]     The applicant rebuilt the besser fence. The neighbour’s car was fixed for $3,000 at the employer’s expense.[5]

Brookside Avenue Tranmere (September 2016):[6]

[12]     A plastered brick pillar on the corner of the block was damaged. The applicant stated that the damage was caused by the truck driver. Mr Dean did not challenge this evidence and stated that he was unaware of the circumstances of the damage.

Windsor Avenue Magill (November 2016):[7]

[13]     The applicant stated that he was pulling out a large footing which, unbeknown to him, ran under a cement brick wall adjoining the neighbour’s property and that ran alongside the driveway on the site. He stated that the Supervisor was supposed to cut under the concrete driveway so that any footings or other fixtures of the wall could be seen, but this had not been done. When the applicant started to remove the footing, the cement wall was damaged.

[14]     The owner of the site and the neighbour agreed that the existing wall could be removed because it was in a state of disrepair and they preferred to have a colour bond fence. It was agreed that the applicant would demolish the concrete brick wall and that the company would remove all the rubble.

[15]     Mr Dean stated that the applicant should have proceeded more cautiously given the proximity of the adjoining wall and the spotter should have been looking out for any movement in the wall. He agreed that the matter was resolved on site and there were no repercussions for the business.

Coreega Avenue Springfield (October 2016):[8]

[16]     Several courses of brick work underneath a brush fence were damaged when hit by the excavator. According to the applicant, the brush fence was not securely fixed at the time but he accepted that he was responsible for the damage to the bricks. He rebuilt the brick courses as far as he was able but couldn’t complete the job because he needed to obtain bricks of a particular colour for the top course of bricks. This particular demolition was undertaken on behalf of Scott Salisbury Homes (SSH), which complained that the job was left unfinished and bricks were left on site. The applicant stated that the brick work was completed about a month and a half later.

[17]     From Mr Dean’s perspective, this became an ongoing issue with SSH, which has not provided any more work to the respondent, in large part, as a result of the issues at Coreega Avenue.

[18]     Mr Kerrison stated that SSH was not satisfied that the fence had been rebuilt to its previous condition and in particular, that the brush fence had not been properly secured. SSH rebuilt the fence and billed the respondent for the cost of this work.

[19]     The details of the actual construction of the fence and, in particular, whether there were any structural weaknesses in the brush fence prior to the damage, is not clear. There is an apparent divergence of views between the applicant and SSH on this point. The photographs of the damaged fence do not shed any light on the structural condition of the brush fence.

Woodcroft Avenue St Georges (June 2016):

[20]     The applicant stated that he was advised that this was a ‘full site clear’ meaning everything on the site was to be removed. He was unaware that there was a creek bed behind an area of vegetation which included some large trees. As he went to remove the first tree stump, the roots, which ran under the creek bed, dislodged some large stones from creek bed. The applicant said that he spoke to the builder, obtained some mortar to replace the stones and refixed the stones a few days later. The remaining trees were cut down at ground level.

[21]     The builder apparently complained about the work on the creek bed undertaken by the applicant a few months later, but the applicant maintains that it had been rectified to the previous condition.

[22]     Mr Dean didn’t have any direct knowledge of this situation and wasn’t aware that it had been classed as a full site clear. He agreed that the applicant did replace the stones, but stated that he subsequently received a call from the builder complaining that the creek had “blown its banks” and there was flooding through the neighbour’s yard.

[23]     Mr Kerrison was unable to confirm that the applicant was advised of the creek bed and/or any details in relation to the vegetation.

Punana Street St Georges (April 2016):

[24]     The applicant denied that he undertook any work on this property. Mr Kerrison disagreed. He referred to some diary notes which he provided to Mr Dean which he believed identified that the applicant did work at this site, but no documents were produced to the Commission.

Elizabeth Street Clapham (October 2016):

[25]     It is alleged that the applicant left footings in the ground at this site. The applicant could not recall whether this was the case or not, but accepted that it may have occurred. He stated that normally he would be requested to go back to the site if work was unfinished but this did not occur at Elizabeth Street. Mr Dean stated that the applicant definitely left the footings on site and other workers returned to the site to remove them after a complaint was received.

Damage to machinery:

[26]     It is agreed that a long crow bar was placed in the hatch of the excavator, and when the machine was started the crowbar damaged the hydraulics. The applicant stated that he did not put the crow bar in the hatch but conceded that it was there and that he should have removed it before starting the machine.

The dismissal

[27]     Mr Dean stated that the complaints from SSH and the subsequent loss of business was the trigger for the dismissal. Approximately a week before the applicant was dismissed, Mr Dean became aware that the issues at Coreega Street were still not rectified to the builder’s satisfaction and at that point he had a discussion with Mr Kerrison. Mr Dean decided that the applicant would be dismissed and it was left to Mr Kerrison to advise the applicant.

[28]     A couple of days later the applicant contacted the business and left a message enquiring as to why he had not been paid for the work he had undertaken. This came to Mr Dean’s attention, who then realised that Mr Kerrison had not as yet advised the applicant he was dismissed. Mr Dean advised Mr Kerrison to terminate the applicant’s employment, which he did via a text message on 23 December 2016 as follows:

“Hi Manny. Andrew will pay you once we get the final bill to repair the wall that was damaged and never repaired properly at Coreega Street. Following on this AC Demolition will no longer require your services next year as there has (sic) been far too many damages caused this year. Thanks Mark”

[29]     Mr Dean did not see a problem with dismissing an employee via text message, stating that this kept the dismissal formal and not personal. He stated that there had been problems in the past with employees becoming threatening and abusive when dismissed.

[30]     The applicant has received payment for time worked and his annual leave accruals.

Was there a prior warning?

[31]     The applicant stated that he had never been warned, verbally or in writing, that his employment was in jeopardy or that the employer was dissatisfied with his performance and/or the damage to property or the excavator. I asked Mr Kerrison about this and he stated that:

“I had. A couple of times it had been brought up as humour on site, like, “Manny, you’ve got to stop doing this.” This is why we took away one of his labourers because we thought maybe he was the problem of why all this was happening, he wasn’t spotting Manny, he wasn’t there for him. So we got rid of him and put another labourer on site with him and the exact same issues were all happening.”

[32]     Mr Kerrison thought this occurred in or about June 2016 and he remembers that he was annoyed because he had rectified damage at other sites on that day before he approached the applicant. He thought there was a further occasion when he raised the issue of damage caused by the applicant but could not provide any details.

Consideration

[33]     Section 387 of the Act sets out the matters to be taken into account by the Fair Work Commission (the Commission) in determining whether the dismissal was harsh unjust or unreasonable, 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.”

Findings on the damage to property and equipment

[34]     I find that the applicant should bear some responsibility for the damage caused to the fence and the neighbour’s car at Blackler Street. I accept Mr Dean’s evidence that a preliminary check of the structure should have been undertaken before demolition work commenced, especially in circumstances where an area of the structure was known to be unstable.

[35]     I find that the applicant was not responsible for the damage at Brookside Avenue.

[36]     In relation to Windsor Avenue, I find that the applicant was partly responsible for the damage caused. I accept his evidence that certain preparatory work had not been undertaken with the result that he could not identify the structure of the footing that was to be removed. However, in these circumstances the applicant should have arranged for the preparatory work to be undertaken before he commenced excavating.

[37]     As to Coreega Avenue Springfield, I accept that the applicant was responsible for the damage caused to the brick courses of the fence, which he subsequently rectified. In relation to the alleged damage to the brush fence, the information put forward by the respondent is not sufficient to undermine the applicant’s evidence that it was unstable and not securely fixed before any damage occurred. Mr Dean has relied upon the information from SSH, but this was not put to the applicant. There are no site records that indicate the state of the fence before the damage occurred. Nonetheless, I accept that the applicant’s actions caused whatever damage that did occur.

[38]     It is apparent that SSH were concerned about the work undertaken at this site, including the time taken to repair the damaged brick work, rubble and bricks left at the site and the issue with the brush fence. This became a source of frustration for Mr Dean and I accept that, whatever the extent of the damage caused by the applicant, it became a catalyst for the withdrawal of work by SSH.

[39]     In relation to Woodcroft Avenue St Georges, there is no direct evidence that the applicant was given any instruction about the existence of the creek bed and the removal of vegetation. As such I do not consider that the applicant should be held responsible for any damage to the creek bed.

[40]     I accept the applicant’s evidence that he did not attend Punana St, St Georges. I found the applicant to be an honest witness who readily acknowledged damage that occurred at other sites. I am satisfied that, had he attended Punana Street, he would have admitted this.

[41]     I find that he left footings in the ground at Elizabeth Street Clapham and that he was responsible for the damage to the excavator hydraulics.

Was there a valid reason for dismissal?

[42]     For a reason to be valid it must be sound or defensible. In this case I am satisfied that damage was caused at some sites due to a lack of diligence or concentration by the applicant when undertaking the demolition work, or in advance of undertaking this work. I consider that this lack of concentration was also the cause of the damage to the excavator.

[43]     I am also satisfied that the respondent failed to provide a proper system of work instruction and site records and that this contributed to some of the damage caused. On balance however I conclude that there was a valid reason for dismissal.

Procedural aspects leading up to and including dismissal

[44]     There was a complete absence of procedural fairness to the applicant in the process leading up to the dismissal and in the dismissal itself. The damage at the particular sites relied upon by the respondent has never been the subject of a warning to the applicant. The purpose of a warning is to put an employee on notice that their employment may be in jeopardy if the poor performance is not rectified; to identify what actions are required of the employee in order to improve their performance; and to give the employee the opportunity to rectify the unsatisfactory performance or challenge the validity of the warning, as the case may be.

[45]     To be clear, I do not regard the ‘discussion’ between Mr Kerrison and the applicant in June 2016 as a warning, even on Mr Kerrison’s version of events (which is disputed by the applicant). In any event, there was no further discussion with the applicant during the course of the next 6 months, during which it is alleged that he caused damage on multiple sites.

[46]     Where an employer is contemplating the dismissal of an employee, it is obliged to put the issue/s of concern to the employee before the dismissal is implemented. The employee may have additional facts that are relevant to the employer’s consideration; the employee may dispute some or all of the facts on which the employer relies; or there may be a reasonable explanation for their performance or conduct. In this case, the applicant was denied an opportunity to put his version of the events and, as a result, the decision to dismiss was made by Mr Dean based partly on inaccurate and/or incomplete facts.

[47]     The respondent is a relatively small business, with no human resources expertise. I accept that this is a factor in the manner in which the dismissal was implemented and in the absence of any attempt to deal with the concerns about the applicant’s performance in a structured manner. Had advice been sought by the respondent, it is unlikely that the dismissal would have been conducted in such a perfunctory manner. However I also conclude that the lack of HR advice is not a complete explanation for the lack of proper process afforded to the applicant. The manner in which the applicant was dismissed lacked any sensitivity for the financial and other consequences of the dismissal upon him.

Other relevant factors

[48]     A relevant factor in considering whether the dismissal is harsh, unjust or unreasonable in this case is the absence of any documented operating procedures setting out the steps to be taken on arrival at the site, including assessments of potential danger, structural weakness, hazards etc. In addition, there is no evidence of any site reports or other documents which would have provided guidance to the applicant on any potential risks or structural instabilities on site, nor any documentation for recording relevant information in the event of damage on site.

[49]     The employer has an obligation to provide adequate guidance and instruction to employees in the performance of their role. Apart from protecting the employer’s operations and reputation, the regulation of the work performed is part and parcel of meeting the employer’s work health and safety obligations to provide safe systems of work and to protect the safety of its workers.

[50]     I find that the dismissal of the applicant was harsh, unjust or unreasonable.

Remedy

[51]     The primary remedy under the Act for a dismissal which is harsh, unjust or unreasonable is reinstatement. Compensation is only available as a remedy in the event that the Commission is satisfied that reinstatement is inappropriate and an order for payment of compensation is appropriate in all the circumstances.[9]

[52]     In this matter the applicant does not seek reinstatement and the employer is strenuously opposed to such an order. I am satisfied that reinstatement in these circumstances would not be appropriate.

[53]     Following his dismissal the applicant had a period of unemployment for approximately 8 weeks and then secured employment, albeit on a casual basis for fewer hours, at a lower rate of pay.

[54]     The method for assessing the appropriate amount of compensation is dealt with in s.392 of the Act. This section sets out that the payment of compensation is in lieu of reinstatement and that all circumstances are to be taken into account, including the following:

·the effect of the order on the viability of the employer’s enterprise; and

·the length of the person’s service with the employer; and

·the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

·the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

·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

·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

·any other matter that the FWC considers relevant

[55]     Section 392 of the Act also requires the Commission to reduce the amount of any compensation otherwise ordered if it is satisfied that the misconduct of the employee contributed to the dismissal.

[56]     No information was provided by the respondent on the effect of any order for compensation on the viability of the employer’s enterprise. The applicant had approximately 18 months service at the time of the dismissal, which is neither a short nor a significant period of service. I regard this as a neutral matter in the calculation of the compensation.

[57]     Had the applicant not been dismissed then I consider that his employment would not have continued for any significant length of time. On his own evidence, the applicant stated that he was a proud man and if he had been aware that the employer had concerns about his performance he would have resigned his employment. I have therefore assessed the anticipated period of employment, absent the dismissal, to have been a further 6 weeks after the Christmas closedown. The applicant was earning $1,026 (gross) per week at the time of dismissal.

[58]     I am satisfied that the applicant took reasonable steps to mitigate his loss arising from his dismissal. He is 62 years old and he was dismissed 2 days prior to Christmas. He has bricklaying qualifications but is unable to work as a bricklayer due to physical restrictions.

[59]     Taking all these matters into account, I consider that payment of $4,750 (gross) is a fair amount of compensation taking into account the limited period of anticipated employment had the dismissal not taken effect; and that the applicant’s lack of diligence on some sites contributed to his dismissal.

[60]     An order for this amount is issued with this decision. I have allowed a period of 28 days for payment to be made by the respondent in view of the size of the business.

DEPUTY PRESIDENT

Appearances:

Mr E Kalioros in person

Mr A Dean for the Respondent

Determinative Conference details:

2016.
Adelaide:
28 April.

[1] Email from Mr Dean, 21 March 2017.

[2] In accordance with s.382 of the Act.

[3] Ex R2.

[4] One of the labourers who is designated to assist the applicant to avoid unintended damage when manoeuvring the excavator.

[5] The employer carries public liability insurance with a $5,000 excess.

[6] Ex R3.

[7] Ex R4.

[8] Ex R6.

[9] Section 390 of the Act.

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