Gonva Group Pty Ltd v Lina Ramirez
[2024] FWC 1808
•10 JULY 2024
| [2024] FWC 1808 |
| FAIR WORK COMMISSION |
| REASONS FOR DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
Gonva Group Pty Ltd
v
Lina Ramirez
(C2024/4469)
| VICE PRESIDENT GIBIAN | SYDNEY, 10 JULY 2024 |
Appeal against decision [2024] FWC 1522 of Commissioner Thornton in Adelaide on 13 June 2024 in matter number U2023/10993 – stay application – stay refused.
Introduction
Gonva Group Pty Ltd (Gonva or the appellant) has filed a notice of appeal in relation to a decision of Commissioner Thornton of the Fair Work Commission (the Commission) handed down on 13 June 2024. In the notice of appeal, Gonva seeks a stay of the decision. This decision concerns the stay application. A hearing was conducted in relation to the stay application on the afternoon of 9 July 2024. At the conclusion of the hearing, I indicated that I was not satisfied it was appropriate to grant a stay. These are my reasons for that decision.
The decision concerned an application under s 394 of the Fair Work Act 2009 (Cth) (the Act) by Lina Ramirez seeking an unfair dismissal remedy. The Commissioner found that Gonva had not complied with the Small Business Fair Dismissal Code and that Ms Ramirez’s dismissal was unfair. The Commissioner ordered the payment of compensation of $13,158.97 gross plus 11% superannuation of $1,447.49 (less any applicable taxation) to be paid within 28 days of the decision. The time for payment expires on 11 July 2024.
Gonva is a small food and beverage business that trades as Cafetal Coffee Company. It operates a café serving food and beverages with a focus on South American food and Columbian coffee, and also undertakes importation, roasting and wholesaling of Colombian coffee It was not disputed that Gonva is a small business in that it employed fewer than 15 employees at the time of the dismissal.
Ms Ramirez commenced employment with Gonva on 10 October 2022 as a food and beverage attendant. She was employed on a permanent part-time basis and worked a regular roster of 32 hours per week, initially undertaking shifts on two weekdays and a Saturday and later also working on Sundays. For the last five months of her employment, Ms Ramirez continued to work four days but regularly worked Monday, Wednesday, Friday and Saturday.
It is unnecessary for the purposes of dealing with the stay application to recount the events leading to Ms Ramirez’s dismissal in detail. It is sufficient to record that in around September 2023, Mr Gonzalez became the sole owner and director of Gonza. In the period following September 2023, Ms Ramirez gave evidence of having raised various concerns in relation to her employment with Mr Gonzalez, including with respect to payment on public holidays and returning to work following planned surgery.
Mr Gonzalez appears to have taken exception to the manner in which Ms Ramirez raised these concerns and otherwise questioned in the way in which the business was being operated. Mr Gonzalez alleged that Ms Ramirez recorded telephone conversations between them which was denied by Ms Ramirez. Ms Ramirez did admit to recording a telephone conversation with a representative of the Fair Work Ombudsman.
Following further communications in relation to Ms Ramirez’s return to work following planned surgery, on 27 October 2023, Mr Gonzalez completed a document referred to as the Small Business Fair Dismissal Code Checklist documenting an intention to terminate Ms Ramirez’s employment. On 28 October 2023, Mr Gonzalez sent an email to Ms Ramirez terminating her employment. The Commissioner’s decision recorded as follows:[1]
[40] At 1:29pm on Saturday, 28 October 2023, Mr Gonzalez sent an email to Ms Ramirez terminating her employment. The email contained the following assertions and reasons with respect to Ms Ramirez:
(a) She was not currently on the roster because she requested time off for personal matters;
(b) Her request for time off caused “many inconveniences in the operation of the business”;
(c) The business had had “many problems with you due to your aggressive verbal behaviour, where I myself have spoken with you … But there has been no change and on the contrary you have reached completely unacceptable levels like the one I’ve had to deal with it myself this week”;
(d) The issue of aggressive verbal behaviour was not a new issue and had been happening for a long time, including when the Applicant had worked with Mr Gonzalez’s former business partner;
(e) Mr Gonzalez had defended the Applicant on many occasions to other staff following complaints about aggressive verbal behaviour;
(f) the Applicant had been given enough time to improve her behaviour;
(g) that despite “meeting all your requirements” the aggressive verbal behaviour continued to be a serious problem;
(h) the alleged aggressive verbal behaviour “is unacceptable and should not be accepted in any healthy work environment”; and
(i) that he had an obligation to protect his personal well-being and that of the business.
[41] Mr Gonzalez then included in the email: “Based on the “Small Business Fair Dismissal Code,” I have decided to terminate our employment relationship with immediate effect.”
The Commissioner made factual findings in relation to the allegations. The Commissioner generally preferred the evidence of Ms Ramirez to that of Mr Gonzalez.[2] The Commissioner found that Ms Ramirez was measured in her evidence, direct in her answers and made some concessions where appropriate, even if against her own interests. Mr Gonzalez, in contrast, was found to have overstated the conduct of Ms Ramirez at the relevant times, conveyed his personal hurt and grievances at what he perceived to be disrespectful and aggressive communication by Ms Ramirez, and could only rarely provide specific detail to his allegations against Ms Ramirez.[3] Consequently, the Commissioner found that the conduct relied upon by Gonva did not occur or did not occur in the manner alleged by Gonva.
The Commissioner found that Gonva had not complied with the Small Business Fair Dismissal Code, in substance, because Mr Gonzalez could not, in the circumstances, have reasonably formed the view that Ms Ramirez had committed misconduct, let alone serious misconduct.[4] Following the factual findings that had been made, the Commissioner concluded that there was no valid reason for the dismissal.[5] Having considered the other matters referred to in s 387, the Commissioner found that the dismissal was harsh, unjust and unreasonable.[6]
The Commissioner noted that Mr Ramirez did not seek reinstatement and was satisfied that reinstatement was not appropriate having regard to the breakdown of the relationship between Ms Ramirez and Mr Gonzalez. However, the Commissioner indicated she was satisfied that Ms Ramirez had suffered financial loss, and that it was appropriate to order a remedy in the form of compensation.[7] The Commissioner found that Ms Ramirez would have continued employment for 18 weeks if not dismissed.[8]
The Commissioner considered the matters referred to in s 392(2) of the Act. It is appropriate to record the Commissioner’s consideration of the factor in s 392(2)(a), namely, ‘the effect of the order on the viability of the employer’s enterprise’. The consideration was as follows:[9]
[128] The Respondent did not offer any evidence with respect to the viability of its business, should compensation be awarded. Mr Gonzalez did say at the end of the hearing that he could not afford any compensation but there was no detail to that submission.
[129] I appreciate that Mr Gonzalez operates a small business. I have also taken into account the evidence of Ms Ramirez that the Respondent was considering removing her from the roster on a Monday so as to avoid paying her wages on a public holiday when the business was closed, as being indicative of a concern about revenue and profitability.
[130] However, in the absence of evidence from the Respondent regarding viability, I am unable to discount any compensation awarded on this basis.
It is also relevant to note that the Commissioner recorded that Ms Ramirez had taken reasonable steps to mitigate her loss by seeking alternative employment and had not earned any remuneration since her dismissal.[10]
The Commissioner’s conclusion on the question of compensation was as follows:
[158] Having regard to the circumstances of the matter, the considerations in section 392 of the Act and the requirements arising from the case of Sprigg, I find that it is appropriate to make an award of compensation to Ms Ramirez in lieu of reinstatement in the amount of $13,158.97 gross plus 11% superannuation of $1,447.49, less any appropriate taxation.
[159] Section 393 of the Act allows for an order for compensation to provide for payment in instalments. The Respondent did not make any submissions on this point, but as they are a small business and were not represented in these proceedings, I would be amenable to considering whether the order that will accompany this decision should be amended to allow for the payment of the compensation in instalments.
[160] Should the Respondent seek the amendment of the order to this effect, they must make an application to the Commission within 14 days of the date of the order, providing reasons and evidence as to why the compensation amount cannot be paid in full.
Consideration of Stay
The power to grant a stay pending the hearing and determination of an appeal lodged under s.604 is contained in s.606(1), which provides:
(1) If, under section 604 or 605, the FWC hears an appeal from, or conducts a review of, a decision, the FWC may (except as provided by subsection (3)) order that the operation of the whole or part of the decision be stayed, on any terms and conditions that the FWC considers appropriate, until a decision in relation to the appeal or review is made or the FWC makes a further order.
A commonly cited formulation of the principles applicable to the grant of a stay is found in the decision of the Australian Industrial Relations Commission in Kellow-Falkiner Motors Pty Ltd v Edghill[2000] AIRC 758 in which Ross VP (as his Honour then was) said:[11]
In determining whether to grant a stay application the Commission must be satisfied that there is an arguable case, with some reasonable prospects of success, in respect of both the question of leave to appeal and the substantive merits of the appeal. In addition, the balance of convenience must weigh in favour of the order subject to appeal being stayed. Each of the two elements referred to must be established before a stay order will be granted.”
That statement of the principles is sufficient for present purposes. Assistance may also be derived from the approach adopted by the courts in relation to an application to a stay pending appeal.[12] The principles applied in those cases were summarised in Re Transport Industry - Waste Collection and Recycling (State) Award (2000) 102 IR 192 at [19] as follows:
(1) The mere filing of an appeal will not of itself provide a reason or demonstrate an appropriate case nor will it discharge the onus which the applicant bears.
(2) A court has an appropriate discretion whether or not to grant the stay and as to the terms that would be fair if a stay be granted.
(3) The onus is upon the applicant for a stay to demonstrate a proper basis for a stay that will be fair to all the parties.
(4) In the exercise of its discretion all considerations including the balance of convenience and the competing rights of the parties need to be considered and weighed.
(5) Where there is a risk that the appeal will prove abortive or nugatory if the stay is not granted then the normal exercise of discretion will result in the grant of a stay.
(6) Although, generally speaking, it is inappropriate in relation to an application for a stay to speculate as to the appellant's prospects of success, this does not prevent a court, in the context of considering the specific terms of the stay that will appropriately and fairly adjust the interests of the parties, from making a preliminary assessment as to whether the appellant has an arguable case.
It is appropriate to emphasise that an applicant for a stay must positively demonstrate that the balance of convenience must weigh in favour of a stay being granted. There is no prima facie position in favour of the granting of a stay and the grant of a stay is not to be regarded as the usual course.[13]
The grounds contained in the notice of appeal are lengthy and discursive. There are three grounds. Broadly, the first ground alleges that the Commissioner failed to have regard to the factor in s 392(2)(a) of the Act relating to the viability of the employer’s enterprise and, in particular, failed to ask the appellant for evidence in relation to its financial position. The second ground challenges the factual conclusions of the Commissioner and alleges that the ‘facts’ did show serious misconduct. The third ground is that Mr Gonzalez feels discriminated against by his gender, lack of communication skills in English, and cultural background by reason of the Commissioner not accepting his evidence.
The usual principles for determination of a stay require a preliminary assessment of the merits of the appeal, both on the question of permission to appeal and the substantive merits of the appeal. Although this assessment is necessarily preliminary and superficial, on the material presently available to me, I am not satisfied that the grounds set out in the notice of appeal give rise to sufficient prospects of success on appeal to justify the granting of a stay of the order for the payment of compensation.
Based on a preliminary assessment only, it appears to me that the Commissioner did consider the impact of the compensation order on the viability of the appellant on the material put forward by the parties. It is not generally for the Commission to request or require a party to put forward evidence in proceedings. The challenges to the factual findings of the Commissioner confront the hurdle of demonstrating that the threshold in s 400(2) of the Act is met and of demonstrating that there is a sufficient basis for overturning those findings having regard to the advantages enjoyed by the Commissioner in seeing and hearing the witnesses give evidence.
Mr Gonzalez sought to put forward material in support of the stay application in relation to the financial position of the business. He puts very forcefully that the appellant is not able to pay the order for compensation. Without setting out the details of the material provided, I am persuaded that the business is in a difficult financial position and that the business represents Mr Gonzalez’ sole source of income to support himself and his family. Of course, the Commission has sympathy for Mr Gonzalez in those circumstances.
The financial state of the business may be relevant to an assessment of the balance of convenience, although it perhaps cuts both ways in that Ms Ramirez may have concerns that, if a stay is granted, she may never be paid. There are also financial considerations in relation to Ms Ramirez. She has been out of work and without remuneration for a substantial period following her dismissal. It is sufficient to say that the financial circumstances of the appellant, having regard to the whole of the circumstances, do not justify the granting of a stay in the absence of a sufficiently arguable case being put forward in support of the appeal.
The Commissioner invited the appellant to apply for the compensation order to be varied to provide for payment in instalments if the amount could not be paid in full. Mr Gonzalez did not take up that opportunity within the 14-day period afforded by the Commissioner. Mr Gonzalez indicated that there may have been reasons for him not applying for payments to be made by instalments but did not elaborate upon those reasons in any detail. That is not a matter for me to consider.
If the appellant cannot pay the compensation amount, it should have taken up the opportunity afforded to seek an order for payment by instalments. It may be that, although the time afforded for the making such an application has expired, the Commissioner would consider the matter if now approached if some explanation is provided in relation to the delay in making that application. If the appellant now applies for the order to be varied to provide for payment by instalments, whether to now consider or accept such an application is a matter for the Commissioner.
For these reasons, I order that the application for a stay order in the notice of appeal be refused.
VICE PRESIDENT
Appearances:
J Gonzalez, Director of the Appellant
L Ramirez, Respondent
Hearing details:
2024.
Sydney (via video link):
9 July.
[1] Ramirez v Gonva Group Pty Ltd[2024] FWC 1522 at [40]-[41].
[2] [2024] FWC 1522 at [51].
[3] [2024] FWC 1522 at [52]-[53].
[4] [2024] FWC 1522 at [83].
[5] [2024] FWC 1522 at [92].
[6] [2024] FWC 1522 at [110]-[115].
[7] [2024] FWC 1522 at [122].
[8] [2024] FWC 1522 at [137].
[9] [2024] FWC 1522 at [128]-[130].
[10] [2024] FWC 1522 at [145]-[151].
[11] Kellow-Falkiner Motors Pty Ltd v Edghill[2000] AIRC 758 at [5].
[12] See, for example, Alexander v Cambridge Credit Corporation Ltd (1985) 2 NSWLR 685 at 694; Powerflex Services Pty Ltd v Data Access Corporation (1996) 67 FCR 65 at 66.
[13] Supreme Caravans Pty Ltd v Pham[2013] FWC 4766 at [11] citing Edwards v Telstra Corporation Limited [1998] AIRC 679, Print Q2467.
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