Francesco Mantovani v Industrial Automation Group Pty Ltd T/A Industrial Automation

[2015] FWC 5242

[2015] FWC 5242

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Francesco Mantovani
v
Industrial Automation Group Pty Ltd T/A Industrial Automation
(U2014/16181)

COMMISSIONER WILLIAMS PERTH, 4 AUGUST 2015

Termination of employment.

[1] This decision concerns an unfair dismissal remedy application by Mr Francesco Mantovani (Mr Mantovani or the applicant) made under section 394 of the Fair Work Act 2009 (the Act). The respondent is Industrial Automation Group Pty Ltd T/A Industrial Automation (the respondent).

Background

[2] The respondent was established in 2008 and is a provider of tailored automation solutions and a manufacturer of irrigation and grain aeration equipment and systems.

[3] The respondent first employed Mr Mantovani in 2009 in a casual position whilst he was in Australia on a student Visa. Sometime later with the assistance of the respondent Mr Mantovani gained a 457 Visa and was permanently employed with the company.

[4] In October 2014 Mr Mantovani was dismissed at the initiative of the respondent. The dismissal had effect in early December 2014.

[5] The respondent objects to the application on the jurisdictional grounds that the dismissal was a case of genuine redundancy and separately that the business is a small business and the dismissal was consistent with the small business fair dismissal code.

[6] At the hearing of this matter Mr Mantovani gave evidence and also called as a witness Mr Clive Barratt (Mr Barratt) whom had been employed with the respondent until November 2014. The respondent called Mr Henricus de Graaf (Mr de Graaf) a Director of the respondent to give evidence and also Mr Andrea Togniolo (Mr Togniolo) who is employed by the respondent as their Accountant.

The relevant facts

[7] Having considered the evidence of the witnesses I make the following factual findings.

[8] Mr Mantovani worked for the respondent as the Senior Telecommunications Engineer between 2009 and 2011. He was the respondent’s Operations Manager for approximately 18 months between 2012 and 2013. In the middle of 2013 he was appointed as the respondent’s Business Development Manager.

[9] As the Business Development Manager Mr Mantovani was responsible for liaising with and servicing existing clients of the respondent, identifying prospective clients and identifying projects potentially suitable for the respondent to pursue.

[10] Mr Mantovani reported directly to Mr de Graaf.

[11] Mr de Graaf and his wife are the sole Directors of the respondent.

[12] It is common ground between the parties that the respondent had been experiencing some financial problems for an extended period prior to the dismissal of Mr Mantovani. Mr de Graaf gave evidence that on occasions the respondent was unable to pay its bills including paying the wages of its employees or their superannuation on time.

[13] Mr de Graaf says that in 2014 the respondent imposed a freeze on salary increases and a reduction in working hours. 1 However in late June 2014 Mr de Graaf agreed to a request from Mr Mantovani for a pay increase from $36 per hour to $40 per hour. Mr de Graaf’s evidence was that whilst he was disappointed with Mr Mantovani’s request he felt the respondent needed him so he agreed to his demand.

[14] Mr Mantovani’s evidence which I accept is that throughout 2014 his wage was nearly always paid late.

[15] The evidence is that Mr Mantovani had on a number of occasions throughout 2014 pursued his concerns about the delay in paying his and the other employees’ wages and superannuation with the respondent’s accountant Mr Togniolo and also with Mr de Graaf.

[16] Superannuation payments to the respondent’s employees were outstanding for many months.

[17] Australian Tax Office (ATO) advice to Mr Mantovani provided to him in December 2014 was that it had established an employer debt for outstanding superannuation guarantee amounts owed by the respondent to him for the quarters ending 30 September 2013, 31 December 2013, 31 March 2014 and 30 June 2014 totalling approximately $2,824.

[18] This advice from the ATO followed a complaint made by Mr Mantovani on 5 September 2014 that he believed his superannuation guarantee entitlements had not been paid to him by the respondent.

[19] By email on 1 October 2014 to Mr de Graaf Mr Mantovani explained that following meetings held in 2014 regarding the respondent’s failure to pay employees’ superannuation guarantee entitlements since September 2013, and considering no corrective action has been taken since requests to fix this were made in March 2014, he was informing Mr de Graaf that he had lodged a claim with the ATO to the effect that his superannuation entitlements had not been met by the respondent. The email requested a meeting the following day on 2 October 2014 to review the matter and “make sure that an appropriate action is taken by the company for the benefit of the whole employees and the business.”

[20] Mr de Graaf’s evidence was that he was surprised that Mr Mantovani had made the complaint to the ATO as he had been well treated by the respondent in the past and also because he had a detailed knowledge of the company’s financial situation in 2014.

[21] Mr de Graaf’s evidence was he was disappointed Mr Mantovani had complained to the ATO particularly in view of the close working relationship that existed in the respondent’s team and due to the fact that the respondent had sponsored Mr Mantovani’s 457 Visa application which enabled him to reside and work in Australia.

[22] Mr de Graaf’s evidence regarding the discussions he had with Mr Mantovani about his employment following Mr Mantovani advising him he had complained to the ATO was that he told Mr Mantovani he was taking him up on his previous suggestion that he would resign and Mr de Graaf told Mr Mantovani he felt that this would be in the best interests of the organisation.

[23] Mr de Graaf says he told Mr Mantovani the company could no longer afford him and that the managerial tasks he had taken on were in Mr de Graaf’s opinion duplicating other people’s roles which the organisation could not afford so Mr de Graaf told him he had decided it was time to let him go. He says he did refer to the company not needing two bosses which he says was a reference to Mr Mantovani taking upon himself a lot of managerial functions he was not employed for.

[24] Mr de Graaf agrees there were only he and Mr Mantovani present during this discussion.

[25] Mr de Graaf denies Mr Mantovani’s complaint to the ATO had any effect on his decision to terminate Mr Mantovani’s employment.

[26] Mr Mantovani’s evidence as to what occurred following his email to Mr de Graaf advising him of the complaint he had lodged with the ATO was more detailed. He says the next day on 2 October 2014 Mr de Graaf came into his office expressing his severe disappointment that Mr Mantovani had lodged the complaint with the ATO.

[27] Mr Mantovani’s evidence was that Mr de Graaf stated Mr Mantovani should leave the business if he was not happy with the work conditions. Mr Mantovani asked Mr de Graaf to make sure the next wage was paid on time and the superannuation payments were organised as soon as possible. Mr Mantovani says Mr de Graaf did not dismiss Mr Mantovani during this meeting. Mr Mantovani’s evidence was that during this first meeting Mr de Graaf said to him, “If you don’t behave properly I’ll be forced to terminate you.”

[28] Mr Mantovani’s evidence, which I accept, was that some days after this meeting there was a further delay in the payment of his wages and again he was forced to write another email to Mr de Graaf lamenting this fact.

[29] Attached to Mr Mantovani’s application is an email addressed to Mr de Graaf dated 7 October 2014 at 7.08 a.m. I accept this is the email Mr Mantovani refers to in his evidence.

[30] This email refers to September’s wages being due on 3 October 2014 but that as of 7 October 2014 six employees’ wages including Mr Mantovani’s have still not been paid. The email explains this has been raised with the respondent’s accountant and the employees still do not know how much has been transferred to their accounts nor when or if the remaining amounts will be paid. The email says no payslip or documents regarding this have been provided to the employees. The email complains that the delay of wages that occurs every month is a chronic behaviour of the respondent and is not acceptable anymore. Mr Mantovani’s email requests that Mr de Graaf take immediate corrective actions to rectify this practice that he says is unethical and probably illegal. Mr Mantovani says that he is happy to discuss the matter with Mr de Graaf on behalf of the employees at Mr de Graaf’s earliest convenience. The email was copied to Mr Barratt and somebody identified as Amelia.

[31] Mr Mantovani’s evidence is that later on 7 October 2014 the day he sent the email Mr de Graaf came to Mr Mantovani’s office. There was only Mr de Graaf and Mr Mantovani present. Mr Mantovani says that Mr de Graaf told him that he had decided to terminate his employment.

[32] Mr Mantovani denies that Mr de Graaf made any mention about making the Business Development Manager position redundant. He denies Mr de Graaf said anything about making him redundant due to financial constraints.

[33] Mr Mantovani is unsure whether it was said in the first meeting on 2 October 2014 or the second meeting on 7 October 2014 but he is clear in his evidence that Mr de Graaf mentioned that his behaviour in the last months was not tolerable and said that the organisation cannot have two bosses and said words to the effect of:

“I am the only one that decides how to run this business and how to handle issues with the employees including wages and super. It’s time for you to leave.” 2

[34] Mr Mantovani agrees he had on previous occasions threatened to resign his position and Mr de Graaf in his evidence states that when he ultimately dismissed Mr Mantovani he was in effect taking him up on his previous offer to resign. 3

[35] When cross-examined on this point Mr Mantovani’s evidence was as follows and I note English is not Mr Mantovani’s first language:

“Now at these management meetings did you ever offer to resign because of the financial situation?---I never offered to resign because the financial situation.  I said clearly that I was ready to resign if the organisation would not have respected the law.  Pay employees on time, pay superannuation guarantee contribution and even more important, as business development manager, and I would say is - it would be very easy to tell that I was covering only the business development manager.  In the reality I was cover that position as well as other positions, but let's don't go into details.  I was interacting with customers, suppliers, that were asking me why the organisation was pay the bill, the invoice, after 90, plus 90, plus 120 days when the agreement was plus 30.  So more than one time in the business meeting - and I have some document here signed by myself and by Mr - the respondent that I didn't put through the Commission so I don't know if I can present them.  But more than one time I told, "If we don't respect the law, if we don't pay the invoices on time, I cannot work ethically as business development manager, as engineer and as member of the Engineering Australia", because my obligation as a member of Engineering Australia is to work with ethic, respect the law.  If I don't do that I can lose even my membership, and I do believe in these values. …”

[36] Considering this I accept Mr Mantovani’s evidence as to the reasons he had previously advised Mr de Graaf that he felt he may have to resign. Mr de Graaf’s evidence that when he did dismiss Mr Mantovani he was taking Mr Mantovani up on his offer that he should resign due to the poor financial situation I find was a distortion of what Mr Mantovani had previously said.

[37] In support of Mr de Graaf’s explanation of what was said to Mr Mantovani and the reason he was dismissed his evidence is it that in September 2014 he appointed an external consultant to report on the company’s operations, structure and financial situation. The consultant’s report was reviewed by the Directors of the company, being Mr de Graaf and his wife. The position of Business Development Manager was identified as the biggest cost overhead. Mr de Graaf and his wife as the Directors reviewed the need to have a Business Development Manager and concluded that due to the company’s financial situation the respondent was not able to afford such a position.

[38] Mr Mantovani was not aware of any such consultant’s report. Mr Mantovani says he did however meet somebody he believes may have been a consultant because this person was asking him some information about what his job was and what he was doing.

[39] The respondent has not provided the Commission with a copy of the consultant’s report. Mr de Graaf did not explain whether the consultant’s report dealt with any other issues beyond the position of the Business Development Manager having been identified as the biggest cost overhead. 4 In addition the respondent had the opportunity to call the consultant to give evidence to confirm the outcome of the report and/or that making the Business Development Manager’s position redundant was consistent with the findings of that report but did not do so. Mrs de Graaf was not called to give evidence about the decision to make the position redundant. This is all surprising given the applicant from the outset in the substantive application states that he believes the redundancy was not genuine and was caused by his complaint regarding his superannuation to the ATO.

[40] There is obviously a direct conflict in evidence between Mr de Graaf and Mr Mantovani as to what Mr de Graaf said to Mr Mantovani when he terminated him.

[41] In coming to a conclusion as to whose version of these private discussions between Mr de Graaf and Mr Mantovani I prefer I have considered the following.

[42] Mr Mantovani was subject to cross-examination by the respondent’s paid agent. Mr de Graaf was subject to only limited cross-examination by Mr Mantovani who represented himself. As will be seen below Mr de Graaf’s evidence regarding one particular meeting has been rejected by the Commission because it conflicts directly with the evidence of both Mr Barratt and Mr Mantovani.

[43] Mr Mantovani submits the true reason for his dismissal was Mr de Graaf was angered that he had made a complaint to the ATO and this was compounded by the fact that after their discussion on 2 October 2014 Mr Mantovani had again raised with Mr de Graaf a complaint about delayed payment of wages on behalf of himself and other employees which apparently brought Mr de Graaf to the point where he decided Mr Mantovani had to leave. Contrary to this Mr de Graaf says the financial position of the business had triggered a consultant’s review and report and that having considered this report doing away with the role of Business Development Manager was decided necessary and consequently Mr Mantovani’s position was made redundant and this was why he was dismissed.

[44] Mr Mantovani’s version of what occurred is supported by the evidence that Mr Mantovani had been complaining on his own and others’ behalf repeatedly about delayed payments for a lengthy period, he had made a complaint to the ATO, Mr de Graaf was aware that he had made this complaint, Mr de Graaf met with Mr Mantovani and expressed disappointment that he had made the complaint, shortly after this again by email Mr Mantovani made a further complaint about delayed payments, his dismissal by Mr de Graaf occurred the same day this email was sent. These are a series of facts that support Mr Mantovani’s version of what has happened here.

[45] Mr de Graaf’s version of what occurred is supported by the evidence of the poor financial position of the business, Mr de Graaf’s evidence that the position of Business Development Manager was made redundant and that the termination letters confirm this. There are limited facts that support Mr de Graaf’s version of what has happened here. In addition the respondent had the opportunity to strengthen its evidentiary case by calling the consultant to give evidence regarding the report findings or providing a copy of the report or calling Mrs de Graaf to give evidence but did not do so.

[46] My conclusion, considering all of the evidence and the matters explained above, is that I prefer the evidence of Mr Mantovani as to what was said by Mr de Graaf when he met with him on 2 October 2014 and 7 October 2014. I find that Mr de Graaf did not say to Mr Mantovani that the position of Business Development Manager was redundant.

[47] After the 7 October 2014 discussion Mr de Graaf provided a termination of employment letter dated 12 October 2014 which refers to the financial circumstances of the company requiring a decision to reduce overheads. The letter refers to a project known as the Mandurah Central Irrigation System having come to completion and that Mr Mantovani’s position is no longer needed.

[48] Subsequent to this there was ongoing conflict between Mr Mantovani and Mr de Graaf regarding the resolution of what Mr Mantovani believed was his outstanding entitlements. Mr Mantovani was attempting to ensure these were paid before he left the business.

[49] The evidence of Mr Mantovani which is confirmed by the evidence of Mr Barratt is that on 24 October 2014 Mr Mantovani attempted to have a meeting with Mr de Graaf with Mr Barratt present to witness the discussion. The evidence of both Mr Barratt and Mr Mantovani which I accept is that Mr de Graaf refused to proceed with the meeting with Mr Mantovani in Mr Barratt’s presence and said words to the effect that:

“When I meet my employees to discuss financial issues I don’t want any witnesses taking part in the meeting.” 5

[50] Mr de Graaf under cross-examination by Mr Mantovani denied that Mr Mantovani ever asked to have a meeting with him where a witness was present. 6

[51] On this point I do not accept Mr de Graaf’s evidence and prefer the evidence of Mr Mantovani and Mr Barratt to the contrary. I find that Mr de Graaf deliberately avoided meeting with Mr Mantovani to discuss his outstanding entitlements in the presence of Mr Barratt. Mr de Graaf’s actions were designed to prevent there being a witness to these discussions between himself and Mr Mantovani.

[52] Mr Mantovani’s evidence which was not challenged was that in September 2014 the respondent won a new large three-year contract for the supply of aggregation controllers in Port Hedland.

[53] The unchallenged evidence of Mr Mantovani 7 which I accept is that after Mr Barratt left he could have taken over his role because Mr Mantovani had covered this role in his previous years of employment.

[54] Mr Barrett was the Senior Process Control Engineer and he resigned from the respondent in November 2014 after Mr de Graaf had told Mr Mantovani he was dismissed.

[55] After the decision was made to dismiss Mr Mantovani, Mr de Graaf engaged two new contractors on a full-time basis; one as a Project Manager and the other as a Project Assistant.

[56] With respect to the number of employees I have considered the evidence on this point and favour the evidence of Mr de Graaf that at the time notice of dismissal was given by the respondent the business employed fewer than 15 employees.

The legislation

[57] The relevant provisions of the Act are set out below.

“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.”


“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.”

“The Small Business Fair Dismissal Code was declared on 24 June 2009 pursuant to subsection 388(1) of the Fair Work Act 2009.

Commencement

The Small Business Fair Dismissal Code comes into operation on 1 July 2009.

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), a statement of termination or signed witness statements.”

“389 Meaning of genuine redundancy

(1) A person’s dismissal was a case of genuine redundancy if:

(a) the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and

(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

(2) A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:

(a) the employer’s enterprise; or

(b) the enterprise of an associated entity of the employer.”

Consideration

The Small Business Fair Dismissal Code

[58] Considering the evidence I am satisfied that immediately before the time Mr Mantovani was given notice of his dismissal the respondent was a small business.

[59] Considering the findings as to what Mr de Graaf said to Mr Mantovani on 2 October 2014 and 7 October 2014 and the factual matrix as a whole it is reasonable to infer that on the balance of probabilities the reason for the dismissal was that Mr Mantovani had been and was continuing to pursue concerns about the delayed payment of his and other employees’ wages and superannuation.

[60] Mr Mantovani was not told prior to his dismissal that he was at risk of being dismissed for any valid reason. Making a complaint to the ATO or complaining of delayed payment of wages and superannuation is not a valid reason for dismissal.

[61] I note that Mr Mantovani’s email correspondence had at all times been courteous and polite when he had pursued these matters. If Mr de Graaf had concerns about what Mr Mantovani was doing he had the option of discussing this with him. If Mr de Graaf for instance believed it was not appropriate for Mr Mantovani to be pursuing matters of payment on behalf of others he could have discussed such concerns with Mr Mantovani.

[62] Mr Mantovani’s actions in previously pursuing and continuing to pursue concerns about the delayed payment of his and other employees’ wages and superannuation was not a valid reason to dismiss him based on his conduct or capacity to do the job. Underscoring this is that in relation to Mr Mantovani’s concern about payments for himself, section 341 of the Act provides that an employee has a workplace right to make a complaint or enquiry in relation to his or her employment.

[63] Mr Mantovani had not been warned verbally or in writing that he risked being dismissed for any valid reason.

[64] I find that the dismissal of Mr Mantovani was not in compliance with the Small Business Fair Dismissal Code.

Genuine Redundancy

[65] With respect to the respondent’s jurisdictional objection that Mr Mantovani’s dismissal was a case of genuine redundancy the findings of fact do not support this. The reason for Mr Mantovani’s dismissal was not because the respondent no longer required his job to be formed by anyone because of changes in the operational requirements of the employer’s enterprise. Even if that had been the case there is no evidence that the respondent considered the possibility of redeployment within the employer’s enterprise or the enterprise of any associated entities. Indeed the evidence is that the position occupied by Mr Barratt, whom resigned between the time Mr Mantovani was given notice of his dismissal and that dismissal taking effect, is a position that Mr Mantovani could have filled. Consequently I am satisfied that the dismissal of Mr Mantovani was not a case of genuine redundancy within the meaning of the Act.

Criteria for considering harshness

[66] What remains then is to consider the facts against the criteria set out in section 387 of the Act for deciding whether the dismissal was harsh, unjust or unreasonable.

[67] In this case as I have found above there was not a valid reason for the dismissal related to Mr Mantovani’s capacity or conduct. Rather what occurred was that Mr de Graaf sought to disguise the real reason for dismissing Mr Mantovani by saying his position was redundant when this was not in fact the reason for dismissing him.

[68] Subsections 387 (b) through to (e) of the Act are not relevant.

[69] In some situations where redundancy is wrongly given as the reason for dismissal it might be argued that the small size of the employer’s enterprise and its lack of dedicated human resource management specialists explains what occurred however that is not the case here. These are not mitigating factors in this case.

[70] Mr Mantovani has been employed for approximately five years.

[71] Considering the facts of this matter and the legislative provisions I am satisfied that the dismissal of Mr Mantovani wasunjust and unreasonable. Mr Mantovani was unfairly dismissed.

Remedy

[72] The Act provides that reinstatement is the primary remedy where an employee has been unfairly dismissed. Indeed the Commission must not order the payment of compensation to an applicant unless the Commission is satisfied that reinstatement is inappropriate and that an order for payment of compensation is appropriate in all the circumstances.

[73] In this case the evidence has disclosed a serious deterioration in the relationship between Mr Mantovani and Mr de Graaf. I am satisfied that in the circumstances reinstatement is inappropriate and that in order for the payment of compensation would be appropriate.

[74] Section 392 of the Act, set out below, specifies the considerations the Commission must take into account when determining an amount of compensation.

“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.”

[75] In this case whilst there is evidence that the financial situation of the respondent had been poor for an extended period the respondent has not provided any evidence that would support a conclusion that an order of compensation of the amount that has been determined below would affect the viability of the enterprise.

[76] Mr Mantovani had been employed for approximately five years.

[77] The payslip provided by the applicant in his materials discloses that the gross annual salary was $83,200 and the hourly rate was $40. Consequently the gross weekly rate was $1,600.

[78] Taking into account the deterioration in the relationship between Mr Mantovani and Mr de Graaf and Mr Mantovani’s unsurprising frustration at the continuing delays in the payment of his wages and superannuation which had been occurring over a lengthy period I have concluded that Mr Mantovani would not have remained in employment with the respondent for more than four months had he not been dismissed as he was.

[79] Had the applicant not been dismissed the remuneration he would have received for those four months is $27,733.

[80] Mr Mantovani’s evidence is that he actively sought another job and he gained new employment on 6 January 2015. I am satisfied that Mr Mantovani made appropriate efforts to mitigate the loss he had suffered because of the dismissal.

[81] The rate of pay for this new position however is $5 an hour less than he was receiving at the respondent and so was $35 an hour or $1,400 per week gross. Consequently I calculate that Mr Mantovani earned remuneration for the three months between 6 January and 5 April 2015 of $18,200.

[82] No payments in lieu of notice were made to Mr Mantovani who was required to take annual leave through to 5 December 2014 which was his date of termination according to the respondent’s second letter of termination dated 3 November 2014.

[83] The amount of compensation payable to Mr Mantovani is the difference between what he would have earned for the four months had he not been dismissed, $ 27,733 and the amount he did earn over this four month period in his new job which was $18,200. The difference is an amount of compensation of $9,533 gross.

[84] The Commission will issue an order in conjunction with this decision that the respondent pay to Mr Mantovani an amount of compensation of $9,533 gross from which tax will be deducted.

COMMISSIONER

Appearances:

F Mantovani on his own behalf.

I Johnstone, representative for the Respondent.

Hearing details:

2015.

Perth:

May 5.

 1   Exhibit R3 at paragraph 21.

 2   Exhibit A1 at paragraphs 11 to 16 and Transcript at PN126 to PN138.

 3   Exhibit R3 at paragraph 35 and Transcript at PN483.

 4   Exhibit R3 at paragraph 31.

 5   Exhibit A2 at paragraph 12 to 17.

 6   Transcript at PN582 to PN586.

 7   Exhibit A1 at paragraph 18.

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