Evan Hope v Heysham Corporation Pty Ltd ATF Caldeade Trust T/A Select Events

[2015] FWC 1296

[2015] FWC 1296

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Evan Hope
v
Heysham Corporation Pty Ltd ATF Caldeade Trust T/A Select Events
(U2014/11865)

COMMISSIONER LEWIN MELBOURNE, 2 MARCH 2015

Application for relief from unfair dismissal.

Introduction

[1] This decision concerns an application made under s 394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy by Mr Evan Hope against Heysham Corporation Pty Ltd ATF Caldeade Trust T/A Select Events (Select Events). Mr Hope was employed by Select Events from 23 July 2012 until 8 August 2014.

[2] The application was heard in Mildura on 16 December 2014. The Fair Work Commission (the Commission) dismissed a jurisdictional objection raised by Select Events, ex tempore, on 16 December 2014. The reasons for that decision were subsequently published in Evan Hope v Select Events[2015] FWC 120.

[3] This decision should be read in conjunction with the reasons for decision dismissing the jurisdictional objection, mentioned above, in which various findings of fact were made.

Background

[4] At the hearing at Mildura, before determination of the jurisdictional objection, evidence was given by the following persons about the facts and circumstances of the termination of Mr Hope’s employment:

• Mr Evan Hope;



• Mr Darren Wheeler, operations manager of Select Events; and,



• Ms Tracey Dahlitz, owner of Select Events.

[5] After the ex tempore determination of Select Event’s jurisdictional objection at Mildura, the Commission enquired of the parties if they proposed to call any further evidence in relation to the merits of the application. Both parties indicated that no further evidence would be called.
[6] Consequently, the following directions were issued on 17 December 2014:

“The Applicant, Mr Evan Hope, is directed to file and serve with the Fair Work Commission, and serve on the Respondent, final submissions the Applicant intends to rely on in support of the application in this matter including any remedy, by no later than 4:00pm, Monday, 12 January 2015.

The Respondent, Select Events, is directed to file and serve with the Fair Work Commission, and serve on the Applicant, final submissions the Respondent intends to rely on in this matter including any remedy, by no later than 4:00pm, Monday 9 February 2015.”

[7] Mr Hope and Select Events filed written submissions in accordance with the directions, above.

[8] There is no submission that Mr Hope was not a person protected from unfair dismissal when his employment was terminated or that the dismissal was a case of genuine redundancy.

Legislative scheme

[9] The Small Business Fair Dismissal Code (the Code) applies in this case as at the time Mr Hope was dismissed by Select Events it had fewer than 15 employees. The Code states:

“Summary Dismissal

It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.

Other Dismissal

In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.

The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.

The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.

Procedural Matters

In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.

A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), statement of termination or signed witness statements.”

[10] Select Events is a small business employer subject to the Code. Select Events have conceded that the termination of Mr Hope’s employment was not consistent with the Code. On the evidence before me, I am satisfied that the dismissal of Mr Hope as effected by Select Events was not consistent with the Code.

[11] I now turn to consider Mr Hope’s substantive application on the evidence and material before me in accordance with the relevant statutory provisions which are set out in s 387 of the Act, 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.”

Statutory considerations

(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):

[12] Select Events submits that I should find that Mr Hope refused a lawful and reasonable requirement that he perform work on Sunday, 10 August 2014.

[13] As noted above, the witnesses for Select Events — Mr Wheeler and Ms Dahlitz — filed witness statements and submissions with the Commission on 27 October 2014 and were granted permission to be represented by a lawyer at the hearing in Mildura on 16 December 2014.

[14] The evidence in the witness statements of Mr Wheeler and Ms Dahlitz, filed before the hearing on 16 December 2014, do not rise to support the submission that Mr Hope refused to work on Sunday, 10 August 2014. It is clear that Mr Hope did not wish to work on that day. I dealt with this situation in the reasons for the decision in relation to the jurisdictional objection and found that Mr Hope was seeking to have that day off work in a conversation with Mr Wheeler on Friday, 8 August 2014. It was the conversation on Friday, 8 August 2014 that led to a dispute during which Mr Wheeler renounced and repudiated Select Events’ obligation of good faith and mutuality between Mr Hope and Select Events under the contract of employment, which thereby led to the termination of Mr Hope’s employment when Mr Hope accepted that repudiation.

[15] I have carefully considered the evidence given viva voce in Mildura. In my judgement, the overwhelming weight of the evidence does not support a finding that Mr Hope refused to work on Sunday, 10 August 2014. The contrary is overwhelmingly supported. Namely, that Mr Hope was seeking a day off work from Mr Wheeler on that day after working for 12 days consecutively.

[16] On my reading of the viva voce evidence, there is only one point at which it is suggested that Mr Hope refused to work on Sunday, 10 August 2014. That is at PN362-368 of the transcript during questioning of Mr Wheeler that was supplementary to his witness statement by Mr Davies, the lawyer representing Select Events. Mr Wheeler was a wordy witness and the answers to the questions put to him at that point tended toward elaboration. I find that during the course of his answers to the question at PN633 this elaboration constituted an interpretation invented by him on 16 December 2014 of what the conversation of 8 August 2014 comprised, as referred to in his witness statement.

[17] To the extent that this evidence suggests that during the conversation between Mr Wheeler and Mr Hope on Friday, 8 August 2014 Mr Hope said he was not coming in on the weekend, I reject it. Mr Hope attended for work on the previous weekend including the Sunday of that previous weekend. I prefer Mr Hope’s evidence that he was seeking Sunday, 10 August 2014 as a day off work when Mr Wheeler refused, as I found Mr Wheeler had done in my reasons for decision in relation to the jurisdictional objection.

[18] Moreover, it is of note that Mr Davies did not put the proposition to Mr Hope during cross-examination that he refused to work on Sunday, 10 August 2014. Neither do the witness statements filed by Mr Wheeler and Ms Dahlitz before the hearing of the matter contain the proposition Mr Hope refused to attend for work nor does the submission filed with the witness statements by Select Events in relation to the substantive application. Mr Hope was entitled to seek to have Sunday, 10 August 2014 as a day off after working 12 days straight. On my view of the facts, Mr Hope pressed the argument for him to be allowed the day off work which led to Mr Wheeler becoming frustrated and acting in a manner which brought the employment to an end, as I found in my ex tempore decision in relation to the jurisdictional objection.

(b) Whether the person was notified of that reason:

[19] In the circumstances of this case there was no notice of the reasons for the termination of Mr Hope’s employment, the termination of the employment was summary, in the manner I have found it, as expressed in my reasons for decision in relation to the jurisdictional objection.

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

[20] There was no opportunity for Mr Hope to respond to the reason for the termination of his employment in the relevant circumstances.

(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:

[21] Mr Hope had no opportunity to request a support person to be available.

(e) If the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal:

[22] There is no evidence to suggest that there was any unsatisfactory performance on the part of Mr Hope. As I have found, the dismissal was due to Mr Hope requesting Sunday, 10 August 2014 as a day off work.

(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:

[23] I am satisfied that the size of Select Events had an effect on the procedures followed to effect the termination of Mr Hope’s employment. The evidence is clear that neither Mr Wheeler nor Ms Dahlitz have any sophisticated understanding of contemporary human resource management procedures for the consideration, communication and implementation of the termination of an employee’s employment.

(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:

[24] Likewise, it is clear that Select Events lacked any human resource management resources or personnel. I consider that the absence of such personnel and resources contributed to the procedures or perhaps, more accurately, the lack of appropriate procedures, in effecting the termination of Mr Hope’s employment.

(h) Any other matters that the FWC considers relevant:

[25] I consider that the dispute between Mr Hope and Select Events concerning the hours of work and remuneration to be relevant.

[26] I also consider it relevant that the termination of Mr Hope’s employment was effected capriciously, in my view, by Mr Wheeler without notice or payment in lieu of notice.

Unfair dismissal decision

[27] I find that the termination of Mr Hope’s employment was harsh, unjust and unreasonable.

[28] There was no valid reason for the termination of Mr Hope’s employment. Mr Hope was entitled to seek to have Sunday, 10 August 2014 off work. In fact, that request was something to which Mr Hope was entitled to expect a reasonable response from Mr Wheeler. Mr Wheeler’s response was to state that he was going to terminate Mr Hope’s employment and replace him with a lower paid person. There was nothing in Mr Hope’s work performance or his conduct which justified a conclusion that he could not perform the duties of his position if the matter had resolved without Mr Wheeler’s renunciation and repudiation of Select Events’ obligations under the contractual terms of the employment relationship. Mr Hope did not refuse to work and had not previously done so. Mr Hope was not the subject of a warning for conduct such as refusal to perform the duties of his position, refusal to work as directed or for any other reason associated with his capacity to perform the work or his conduct.

[29] Accordingly, the termination of Mr Hope’s employment was unjustified there was no sound, defensible or well founded reason for the termination of Mr Hope’s employment. The termination was unjust. Moreover, the termination of the employment for seeking a day off, however argumentatively, in a context where Mr Hope had worked for 12 consecutive days, was unreasonable in my judgement. Likewise, to dismiss an employee for being argumentative in support of a request for a day off in such circumstances was harsh.

[30] For all of these reasons I consider that Mr Hope’s employment was terminated unfairly.

Remedy

[31] Mr Hope does not seek reinstatement. I do not consider reinstatement to be appropriate in light of the way in which the employment relationship came to an end. I do, however, consider compensation in lieu of reinstatement of an appropriate amount to be reasonable and apt to the circumstances of the case.

Compensation

[32] I consider an order for compensation is appropriate. The relevant provisions are set out in s 392 of the Act as follows:

“392 Remedy—compensation

Compensation

(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

Criteria for deciding amounts

(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

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

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

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

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

(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

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

Misconduct reduces amount

(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

Shock, distress etc. disregarded

(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.

Compensation cap

(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

(a) the amount worked out under subsection (6); and

(b) half the amount of the high income threshold immediately before the dismissal.

(6) The amount is the total of the following amounts:

(a) the total amount of remuneration:

(i) received by the person; or

(ii) to which the person was entitled;

(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and

(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.”

[33] I will consider these matters in order. Select Events made no submission on the viability of any order on its enterprise.

[34] I must now determine the employment horizon at the time of the termination of Mr Hope’s employment.

[35] I have already noted in this decision and in the reasons for decision for the jurisdictional objection that the issue of hours of work and remuneration had been a subject of disputation and conflict in the relationship between Mr Hope and Select Events for some time before the termination of Mr Hope’s employment.

[36] It is also clear from Ms Dahlitz’s evidence that the continuation of the employment relationship had become problematic for Select Events well before the termination of Mr Hope’s employment on Friday, 8 August 2014.

[37] Moreover, it is clear that Mr Hope was not only dissatisfied with the response to the request to not work on Sunday, 10 August 2014, but more generally with the hours of employment and the level of remuneration, and had been so dissatisfied for some time.

[38] For these reasons, I consider that the employment relationship was the subject of considerable disputation and dissatisfaction for both Mr Hope and Select Events at the time of the termination of Mr Hope’s employment. Accordingly, I consider the employment was not likely to continue for a considerable length of time. Indeed, Mr Hope’s acceptance of Mr Wheeler’s repudiation of the contract of employment evidences that the employment relationship would not have lasted for any significant period of time.

[39] In the circumstances, I judge that the employment would not have continued for any more than 13 weeks.

[40] In light of my considerations above, I estimate the remuneration to have been lost as a result of the termination of Mr Hope’s employment to be equal to 13 weeks pay.

[41] As far as I am able to make out the rate of remuneration applicable to Mr Hope’s employment at the time the employment relationship ended was $1,309 per week. Mr Hope submits I should add to this an amount of $362 in consideration of overtime, which would regularly accrue under his employment arrangement to be taken as time off in lieu. I have decided not to do so. In my view, such a consideration in the absence of express agreement for payment instead of such time off does not fall within what the Act contemplates as remuneration.

[42] Mr Hope earned $4,910 in the period from the 13 weeks from the termination of the employment on Friday, 8 August 2014. That is, until 7 November 2014.

[43] Mr Hope’s efforts at mitigation in the relevant period were reasonable, as demonstrated by his finding work as a rouse-about at Broken Hill not long after.

[44] The Commission’s approach to the determination of an appropriate amount of compensation as a remedy in a case of unfair dismissal follows the procedure adopted in the case of Sprigg v Paul’s Licensed Festival Supermarket. 1 The approach was refined in Ellawala v Australian Postal Corporation,2 of which I include a summary as follows:

1. Estimate the remuneration the employee would have received if they had not been dismissed. Lost remuneration is usually calculated by estimating how long the employee would have remained in the relevant employment but for the termination of their employment i.e. the anticipated period of employment.

2. Deduct any remuneration earned by the employee since their dismissal until the end of the anticipated period of employment.

3. Deduct an amount for contingencies. This is a calculation of future economic loss.

4. Consider the impact of taxation and adjust the figure accordingly.

5. Assess the figure against the compensation cap. If the amount is more than the compensation cap it should be reduced to the compensation cap.

[45] I am prepared to conclude that Mr Hope would most likely have remained in the employment of Select Events for 13 weeks.

[46] I calculate that the lost remuneration of Mr Hope in that time would amount to $17,017.

[47] From this amount I would deduct $4,910, which represents income from other sources for 13 weeks from 8 August 2014 until 7 November 2014.

[48] The above indicates a remedy of $12,107.

[49] A table of the consequences of my findings for calculation of a remedy are set out as follows:

a) 13 weeks at $1,309 per week is $17,017;

b) Deduct $4,910 for income for 13 weeks from 8 August 2014 to 7 November 2014 = $12,107;

c) The remedy arrived at is $12,107.

[50] The compensation cap in this matter is $34,034.

[51] Given that the lost remuneration is calculated at the time of this decision and no consideration of future ongoing loss of remuneration is implicated in the remedy derived above, I consider it is not appropriate to make any deduction for contingencies.

[52] I have considered the remedy calculated above in accordance with the requirement to review the remedy overall as set out in the decision of the Full Bench of the Australian Industrial Relations Commission in Smith v Moore Paragon Australia Ltd (2004) 130 IR 446 and find it appropriate. In my view, the compensation arrived at is neither excessive nor inadequate.

[53] An order will issue that Select Events pay Mr Hope an amount of $12,107.00 in lieu of reinstatement, less appropriate taxation.

COMMISSIONER

 1 (1998) 88 IR 21.

 2   Print S5109.

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