Fink v Alavi Group Trust
[2016] FWC 904
•10 February 2016
[2016] FWC 904
DECISION
| Fair Work Act 2009 | |
| s.394—Unfair dismissal | |
| Manca Fink | |
| v | |
| Alavi Group Trust T/A Como Compounding Pharmacy | |
| (U2015/2900) | |
| DEPUTY PRESIDENT KOVACIC | CANBERRA, 10 FEBRUARY 2016 |
Application for relief from unfair dismissal - jurisdictional objection - small business
employer - dismissal was consistent with Small Business Fair Dismissal Code - Respondent is
small business - Applicant had not served the minimum employment period and therefore not
protected from unfair dismissal - application dismissed.
[1] On 6 February 2015 Ms Manca Fink (the Applicant) filed an application under s.394
of the Fair Work Act 2009 (the Act) alleging that the termination of her employment by Alavi
Group Trust T/A Como Compounding Pharmacy (the Respondent) on 26 January 2015 was
unfair.
[2] In its Form F3 – Employer Response to Unfair Dismissal Application the Respondent
raised a jurisdictional objection, contending that it was a small business and that Ms Fink’s
dismissal was consistent with the Small Business Far Dismissal Code.
[3] The Fair Work Commission (the Commission) issued Directions on 21 April 2015
requiring Ms Fink to file an outline of submissions and any evidentiary material she intended
to rely on regarding the jurisdictional objection and the issue of minimum employment
period.
[4] The application was heard by the Commission on 2 July 2015, with the hearing
conducted as a determinative conference. At the hearing, Ms Fink appeared and gave
evidence on her own behalf, while Mr Nima Alavi, the Respondent’s Director and Proprietor,
appeared and gave evidence for the Respondent. While the hearing primarily concerned the
Respondent’s jurisdictional objection, evidence was also taken regarding Ms Fink’s
substantive application.
[5] For the reasons set out below I have found that the Respondent is a small business
employer for the purposes of the Act, that Ms Fink had not served the minimum employment
period required by s.382 of the Act, that as a result Ms Fink was not protected from unfair
dismissal and that her application was therefore incompetent. Accordingly, Ms Fink’s
application will be dismissed.
[2016] FWC 904
Background
[6] Ms Fink was employed by the Respondent as a Pharmacy Technician. In her
application, Ms Fink states that her employment commenced on 18 February 2014, whereas
the Respondent states that Ms Fink commenced employment as a casual on 26 February 2014.
Ms Fink’s contract of employment which came into force on 7 April 2014 was between
Ms Fink and Alavi Group Trust on behalf of Como Compounding Pharmacy. A contract
renewal came into force on 18 May 2014 after Ms Fink was granted a Temporary Work
[Skilled] visa subclass 457.
[7] Ms Fink was issued two warning letters on 25 November 2014 (both warning letters
were dated 24 November 2014). The first warning letter concerned Ms Fink’s unauthorised
use of a mobile phone during work hours. The warning letter refers to “excessive personal use
of a mobile phone during work hours and handling a mobile phone during compounding
tasks”. In her application, Ms Fink disputes that she used her mobile phone during
compounding tasks and cite several reasons as to why she was required to use her mobile
phone during work hours. The second warning letter relates to the discussion between
Ms Fink and her manager, Ms Vania Giordani, which occurred on 20 November 2014
regarding Ms Fink’s mobile phone usage. Ms Fink contends in her application that she
apologised to Ms Giordani on the day of the incident, saying to Ms Giordani that she was
sorry if she took anything she said the wrong way.
[8] Ms Fink was asked to stay behind on 25 November 2015 to discuss the incidents with
Ms Giordani and Ms Amy Gosden, Pharmacy Manager, at which time she was provided with
the two warning letters. Also during that meeting Ms Fink apologised for her excessive
mobile phone usage and reiterated her previous apology to Ms Giordani.
[9] On 23 January 2015 Ms Fink was issued a third and final warning relating to mobile
phone use in the laboratory. The letter states, among other things, that “… On 21 January
2015 you were witnessed operating your personal mobile phone in the laboratory during work
hours, interrupting and distracting other members of staff as they carry out important
compounding tasks.”
[10] As noted above, Ms Fink was dismissed on 26 January 2015 by way of an email sent
by Mr Alavi at 7:39 pm on that day. The email stated:
“Manca,
I regret to inform you that your employment at Como Compounding Pharmacy will be
terminated effectively immediately, see attached letter. After repeated attempts made
by management at Como Compounding Pharmacy to inform you of your
unsatisfactory conduct there has been no improvement. This decision is non-
negotiable however if you wish to discuss anything in relation to the termination of
th
your employment you may contact me directly from tomorrow (Tuesday 27 January). As a gesture of goodwill I have decided to relieve you of your work duties during your
final two weeks without any penalty to your salary. You should use this time to your
advantage to seek new employment in the hope that another employer may consider
sponsoring you on such short notice.”
[2016] FWC 904
[11] The termination letter attached to that email was dated 25 January 2015 and among
other things stated that “In lieu of working the final 2 weeks, you will be paid the sum that is
owed to you for 2 weeks salary.”
[12] As previously mentioned, Ms Fink lodged her unfair application on 6 February 2015.
The Applicant’s case
[13] Ms Fink submitted that Mr Alavi was a principal of several related companies – Alavi
Group Pty Ltd, Alavi Group Trust and Nima Alavi-Moghadam, the latter two entities trading
as Como Compounding Pharmacy. As such, Ms Fink submitted that they were associated
entities.
[14] In addition, Ms Fink submitted that as at the date of her dismissal the Respondent
employed eighteen employees across all associated entities, a number of whom were
employed as casual employees. In support of that contention Ms Fink relied upon both
material produced by the Respondent under an Order issued by the Commission on 10 April
2015 and rosters covering the period March 2014 to 15 February 2015 (though the rosters
provided for some months were not complete, i.e. the rosters for March, April, May, August,
October and November 2014 were not complete.
[15] At the hearing, Ms Fink inter alia disputed the accuracy of the Payroll Activity
Summary for January 2015 provided by Mr Alavi in accordance with the abovementioned
Order to Produce and cited another business in which Mr Alavi had an interest in, Biostore
Pty Ltd.
[16] Ms Fink also elaborated on the circumstances leading to each of the warning letters
issued to her as well as her termination.
[17] Ms Fink did not address the minimum employment period in either her written or oral
submissions.
The Respondent’s case
[18] The Respondent submitted that the Payroll Activity Summary for Alavi Group Pty Ltd
for January 2015 showed that there were eleven employees working at the Como
Compounding Pharmacy at the time Ms Fink lodged her application.
[19] At the hearing Mr Alavi responded to questions regarding the employment status of
persons which Ms Fink contended were employees of the Respondent and also outlined the
circumstances leading to each of the warning letters issued to Ms Fink and her termination.
[20] The Respondent did not address the minimum employment period in either its written
or oral submissions.
The statutory framework
[21] The Commission exercises its powers in relation to an application for an unfair
dismissal remedy pursuant to Part 3-2 of the Act. The relevant provisions from Part 3-2 of the
[2016] FWC 904
Act are set out below together with the definition of the term “associated entity” set out in
s.12 of the Act and s.23 which deals with the meaning of small business employer.
“12 The Dictionary In this Act:
…
associated entity has the meaning given by section 50AAA of the Corporations Act
2001.
23 Meaning of small business employer
(1) A national system employer is a small business employer at a particular time if
the employer employs fewer than 15 employees at that time.
(2) For the purpose of calculating the number of employees employed by the
employer at a particular time:
(a) subject to paragraph (b), all employees employed by the employer at that time are to be counted; and
(b) a casual employee is not to be counted unless, at that time, he or she has been employed by the employer on a regular and systematic basis.
(3) For the purpose of calculating the number of employees employed by the employer at a particular time, associated entities are taken to be one entity. (4) To avoid doubt, in determining whether a national system employer is a small business employer at a particular time in relation to the dismissal of an employee, or termination of an employee’s employment, the employees that are to be counted include (subject to paragraph (2)(b)):
(a) the employee who is being dismissed or whose employment is being terminated; and
(b) any other employee of the employer who is also being dismissed or whose employment is also being terminated.
382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period;
and
(b) one or more of the following apply:
(i) a modern award covers the person; (ii) an enterprise agreement applies to the person in relation to the employment;
(iii) the sum of the person’s annual rate of earnings, and such other
amounts (if any) worked out in relation to the person in
accordance with the regulations, is less than the high income
threshold.
[2016] FWC 904
Note: High income threshold indexed to $136,700 from 1 July 2015
383 Meaning of minimum employment period
The minimum employment period is:
(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:
(i) the time when the person is given notice of the dismissal; (ii) immediately before the dismissal; or (b) if the employer is a small business employer—one year ending at that time.
Division 3 – What is an unfair dismissal
385 What is an unfair dismissal
A person has been unfairly dismissed if the FWC is satisfied that:
(a) the person has been dismissed; and (b) the dismissal was harsh, unjust or unreasonable; and (c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code:
see section 388.
387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or
unreasonable, the FWC must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and
welfare of other employees); and
(b) whether the person was notified of that reason; and (c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal;
and
(e) if the dismissal related to unsatisfactory performance by the person— whether the person had been warned about that unsatisfactory
performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal;
and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to
impact on the procedures followed in effecting the dismissal; and
(h) any other matters that the FWC considers relevant.
[2016] FWC 904
388 The Small Business Fair Dismissal Code (1) The Minister may, by legislative instrument, declare a Small Business Fair Dismissal Code.
(2) A person’s dismissal was consistent with the Small Business Fair Dismissal Code if:
(a) immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened first), the
person’s employer was a small business employer; and
(b) the employer complied with the Small Business Fair Dismissal Code in relation to the dismissal.
Consideration of the issues
Is the Respondent a small business employer for the purposes of the Act?
[22] The Payroll Activity [Summary] for January 2015 provided by Mr Alavi for the Alavi
Group Trust showed there were ten employees for this period – Ms Olga Alvarez Jofre
(described by Ms Fink as a casual employee); Ms Bita Beheshty; Ms Bonnie Bergin;
Mr Dylan Davidson (also described by Ms Fink as a casual employee); Ms Linh Thuy Do
(also described by Ms Fink as a casual employee); Ms Rebecca Farrell; Ms Fink;
Ms Giordani; Ms Shadi Kazeme; and Ms Rosemary Ritchie. An analysis of the rosters
provided by Ms Fink indicates that the three employees Ms Fink identified as casual
employees were all employed on a regular and systematic basis in the months leading up to
and including January 2015. While Ms Alvarez Jofre only commenced employment in
December 2014, she was rostered to work on eight occasions in December 2014 and sixteen
occasions in January 2015.
[23] The Payroll Activity Summary for January 2015 provided by Mr Alavi for Nima
Alavi-Moghadam showed there were two employees for this period – Ms Amy Gosden and
Mr Maninder Girn.
[24] At the hearing, Ms Fink contended that neither Ms Laura Musgrave nor Ms Jennifer
Locke appeared on the list of employees for the Alavi Group Trust. With regard to
Ms Musgrave, Mr Alavi advised that she was his personal assistant and was the only
employee of Alavi Group Pty Ltd. The material before the Commission indicates that
Mr Alavi is the sole Director and Secretary of the entity and the owner of one of the two
shares issued in the entity. This supports a finding that Alavi Group Pty Ltd is an associated
entity as defined in in s.12 of the Act and that as such Ms Musgrave is to be considered an
employee for the purposes of determining whether or not the Respondent is a small business
employer. As to Ms Locke, Mr Alavi advised that she was a naturopath who was engaged by
the Respondent as a subcontractor, adding that Ms Locke invoices Mr Alavi for the time she
spent at the Pharmacy and that she picks and chooses which days she will attend the
Pharmacy. Mr Alavi’s evidence supports a finding that Ms Locke is not an employee and
therefore should not be included for the purposes of determining whether or not the
Respondent is a small business employer.
[2016] FWC 904
[25] Beyond this Ms Fink submitted that the following persons were also employed by the
Respondent at the time of her dismissal – Mr Zeljko Medos (a casual pharmacist); Ms Reegan
Nash and Ms Maryam Zare.
[26] I have analysed the rosters provided by Ms Fink with her submissions. That analysis
indicates that:
Mr Medos – worked for the Respondent on five occasions in June 2014; eight
occasions in July 2014; one occasion in September, October and November 2014;
did not work at all in August and December 2014; and worked on 4 January 2015.
The rosters also show that Mr Medos was off on 1 and 2 August 2014;
Ms Nash – worked for the Respondent on seven occasions in March 2014; fourteen
occasions in April 2014; eighteen occasions in May 2015; fourteen occasions in June
2014; fifteen occasions in July 2014; eight occasions in August 2014; sixteen
occasions in September 2014; eleven occasions in October 2014; no occasions in
November and December 2014 and January 2015. The rosters also show that
Ms Nash was off on 26 June and 2-3 July 2014; and
Ms Zare – worked for the Respondent on four occasions, i.e. 2 July 2014 and 2,
6 and 31 October 2014.
[27] Mr Medos was described by Ms Fink as a casual employee. The above analysis
indicates that he only worked on two occasions over the period August 2014 to end January
2015 does not support a finding that he was employed on a regular and systematic basis at the
time of Ms Fink’s dismissal. The above analysis also points to Ms Nash and Ms Zare being
casual employees and indicates that Ms Nash was not employed on a regular and systematic
basis at the time of Ms Fink’s dismissal and that Ms Zare was not employed at the time of
Ms Fink’s dismissal. In other words, the analysis supports a finding that none of the above
three employees should be considered employees for the purposes of determining whether or
not the Respondent is a small business employer.
[28] Ms Fink also submitted that Mr Alavi was an employee of the Respondent as he
worked in the Pharmacy on a number of occasions. Ms Fink did not provide any evidence to
support her contention in this regard other than the rosters that she provided with her
submissions. Those rosters clearly indicate that Mr Alavi worked in the Pharmacy on a
number of occasions, but not on a regular basis.
[29] As to Biostore Pty Ltd, material provided by Mr Alavi on 16 July 2015 in response to
a request from the Commission at the hearing indicated that he was one of three shareholders
holding an equal number of shares in the entity. As mentioned above, at the hearing Mr Alavi
stated that Biostore Pty Ltd employed one employee. Section 12 of the Act defines an
associated entity by reference to s.50AAA of the Corporations Act 2001 (the Corporations
Act). Sections 50AAA and 50 (which deals with related bodies corporate) of the Corporations
Act provide as follows:
“50 Related bodies corporate Where a body corporate is:
(a) a holding company of another body corporate; (b) a subsidiary of another body corporate; or
[2016] FWC 904
(c) a subsidiary of a holding company of another body corporate;
the first-mentioned body and the other body are related to each other.
50AAA Associated entities (1) One entity (the associate) is an associated entity of another entity (the principal) if subsection (2), (3), (4), (5), (6) or (7) is satisfied. (2) This subsection is satisfied if the associate and the principal are related bodies corporate. (3) This subsection is satisfied if the principal controls the associate. (4) This subsection is satisfied if:
(a) the associate controls the principal; and (b) the operations, resources or affairs of the principal are material to the associate.
(5) This subsection is satisfied if:
(a) the associate has a qualifying investment (see subsection (8)) in the principal; and
(b) the associate has significant influence over the principal; and (c) the interest is material to the associate.
(6) This subsection is satisfied if:
(a) the principal has a qualifying investment (see subsection (8)) in the
associate; and
(b) the principal has significant influence over the associate; and (c) the interest is material to the principal.
(7) This subsection is satisfied if:
(a) an entity (the third entity) controls both the principal and the associate; and
(b) the operations, resources or affairs of the principal and the associate are both material to the third entity.
(8) For the purposes of this section, one entity (the first entity) has a qualifying investment in another entity (the second entity) if the first entity:
(a) has an asset that is an investment in the second entity; or (b) has an asset that is the beneficial interest in an investment in the second entity and has control over that asset.”
[30] As Mr Alavi does not have a controlling interest in Biostore Pty Ltd it cannot be
considered as an associated entity for the purposes of the Act. Accordingly, the employee of
Biostore Pty Ltd should not be considered an employee of the Respondent for the purposes of
determining whether or not the Respondent is a small business employer.
[31] In summary, the above analysis indicates that the Respondent employed thirteen
persons at the time of Ms Fink’s dismissal. Those persons were Ms Alvarez Jofre;
Ms Beheshty; Ms Bergin; Mr Davidson; Ms Thuy Do; Ms Farrell; Ms Fink; Ms Giordani;
[2016] FWC 904
Ms Gosden; Mr Girn; Ms Kazeme; Ms Musgrave; and Ms Ritchie. Even if Mr Alavi is
considered as an employee, the Respondent is still a small business employer as defined in
s.23 of the Act.
Was Ms Fink protected from unfair dismissal?
[32] Section 382 of the Act provides that an employee is protected from unfair dismissal if
at the time of their dismissal they had completed at least the minimum employment period.
Section 383 of the Act provides that the minimum employment period for an employee
employed by a small business employer is one year.
[33] As previously mentioned, Ms Fink commenced employment with the Respondent on
either 18 or 26 February 2014 and was dismissed on 26 January 2015, i.e. a period of just less
than one year.
[34] As Ms Fink had not served the required one year minimum employment period, she is
not protected from unfair dismissal by the Act. Accordingly, her application is incompetent
and will be dismissed.
Other issues
[35] In view of the above finding, I do not need to consider whether Ms Fink’s dismissal
was consistent with the Small Business Fair Dismissal Code.
Conclusion
[36] For all the above reasons I find that:
(i) the Respondent is a small business employer for the purposes of the Act; (ii) Ms Fink had not served the minimum employment period required by s.382 of the Act;
(iii) as a result, Ms Fink was not protected from unfair dismissal; and
(iv) Ms Fink’s application is therefore incompetent and will be dismissed.
[37] An order dismissing Ms Fink’s application will be issued in conjunction with this
decision.
Appearances:
M. Fink on her own behalf.
N. Alavi for the Respondent.
[2016] FWC 904
Hearing details:
2015.
Melbourne:
July 2.
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