Ida Wange v Atom Resources Pty Ltd

[2021] FWC 1237

[2021] FWC 1237

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Ida Wange
v
Atom Resources Pty Ltd
(U2020/11074)

DEPUTY PRESIDENT CROSS SYDNEY, 8 MARCH 2021

Application for an unfair dismissal remedy.

[1] An application was filed on 15 August 2020 (the Application), by Ms Ida Wange (the Applicant), pursuant to s.394 of the Fair Work Act 2009 (Cth) (the Act), following her dismissal on 18 June 2020, that took effect on 27 July 2020. The Applicant seeks unfair dismissal remedies of compensation, expressed as “Reimbursement for lost salary.” 1 In these proceedings the Applicant was represented by Mr D Bachir, Solicitor. The Respondent was represented by its Managing Director, Mr Hopes.

[2] The Applicant commenced employment with the Respondent on 22 July 2019. The Respondent stated the Applicant was terminated on the ground of redundancy. The Applicant asserted the dismissal arose from allegations of a breach of confidential information by her and her partner.

[3] The Respondent had claimed that the Application was out of time. That jurisdictional objection was dismissed in a hearing on 30 October 2020 after I determined that the Applicant’s dismissal occurred on 27 July 2020, and so the Application was not out of time (the OOT Decision).

[4] On 30 October 2020, directions were issued to program the manner in which the Application was to proceed to hearing (the “Directions”). The parties complied with the Directions. In particular:

(a) On 3 November 2020, the Applicant filed an Outline of Submissions (the “Applicant’s Submission”), and a statement of the Applicant dated 20 November 2020; and

(b) On 14 December 2020, the Respondent filed an Outline of Submissions (the “Respondent’s Submission”), and an undated “statement” which did not identify the deponent. The Commission was later informed that it was a “joint statement” of Mr Hopes and Ms Michelle Da Costa, the Human Resources Manager of the Respondent. In the hearing that statement was adopted as the evidence of Mr Hopes.

Background

[5] The matter was heard on 21 December 2020. There were only minor factual disputes between the parties. The statements of both the Applicant and Mr Hopes were admitted into evidence and neither was cross-examined. Ms Da Costa was called to give oral evidence regarding a meeting on 29 July 2020, and was cross-examined regarding that evidence.

[6] The Applicant had previously worked for the Respondent from 22 January 2017, until around June 2018, when she left her employment to study in Sweden. In or around October 2018, the Applicant returned to Sydney, and commenced casual employment with the Respondent in the role of Administration/Payroll Administrator. The Business of the First Respondent involved recruitment.

[7] On 22 July 2019, the Applicant commenced full-time employment with the Respondent in the role of "Marketing & Business Optimisation Co-Ordinator" (the Role). On an agreed salary of $85,000.00 per annum plus superannuation. Her responsibilities included devising and implementing the Respondent’s marketing, social media and email marketing strategy, website management, search engine optimisation (SEO), marketing collateral, event management, customer relationship management (CRM) platform management and miscellaneous administrative duties.

[8] Junaid Rana is the Applicant’s partner. Mr Rana was previously employed by the Respondent as a recruitment consultant. In or around February 2020, Mr Rana resigned from his role with the Respondent and took up employment with Denovo Recruitment Australia Pty Ltd (Denovo). Like the First Respondent, Denovo also carries on a recruitment consulting and labour-hire business.

[9] In or around March 2020, due to the economic impacts of the COVID-19 pandemic, the Respondent decided to reduce all salaries by 25%. The Respondent lost 70% of its business revenue. Due to a restructure, two positions were made redundant. Since that time, The Respondent has had to make a further position redundant.

[10] The Respondent decided to make the Applicant’s position redundant. The Respondent calculated what the Applicant was legally entitled to, and concluded it was one-week of redundancy pay or the option to work for four weeks notice. On or about 18 June 2020, whilst the Applicant was at work at the Respondent's Offices, she was called into the boardroom by Mr Hopes. She and Mr Hopes had a discussion in words to the following effect:

Mr Hopes:	Unfortunately, we don't have the budget to keep the marketing role. Your role with Atom is being made redundant. We no longer require you to perform your duties.
The Applicant:	I'm sad to leave Atom but I understand the situation.
Mr Hopes:	I'm sorry but this is the situation. You will .finish up tomorrow and we'll pay you your four weeks' notice period and annual leave. Maybe we can revisit the idea of hiring you again, as a casual employee on JobKeeper.

[11] On or about 24 June 2020, Mr Hopes called the Applicant again and they had a telephone discussion in words to the following effect:

Mr Hopes:	Hi Ida, Following on from our previous discussion, we will not be able to pay you the four-week notice period, we instead propose to pay you one week's redundancy pay. However, if you 're willing to work the four-week notice period, then we'll be happy to pay you for that. You can work from home during that period, it won 't be a problem.
The Applicant:	This isn't what we first agreed on. I'll have to have a think about my options and get back to you.
Mr Hopes:	Fine.

[12] On 24 June 2020 or 25 June 2020, Mr Hopes and the Applicant exchanged the following email messages:

(1) Wednesday, 24 June 2020 12:51 PM

“Hi Jonathan,

Following our call yesterday, I just wanted clarification on a few things before I make a decision.

- The next four weeks would be me working out my notice period? You mentioned that we could then try and keep me on JobKeeper until September. However , once terminated (with a written notice) I'm no longer eligible for JobKeeper and you would have to notify of my change of status. Or would I technically still be employed to gain access to JobKeeper?

- Regarding my annual leave, when in this case would that be paid out and confirming that this will be paid out at my original salary?”

(2) Wednesday, 24 June 2020 2:54 PM

“Hi Ida,

If you choose the one week redundancy option, your last day would officially be Friday 19th June, your annual leave and one week redundancy will be paid in tomorrow's payroll.

If you choose to work your four week notice period, your employment termination will be effective from the 17/07/2020. We will then re-employ you on a casual basis, under Job-Keeper on a project by project basis which we will review weekly. You will receive a separate contract for this, and your annual leave will be paid in your final payment following your four week notice.

Please let me know any other questions , or if you want to grab a coffee and talk through, please let me know. Thanks”

Jonatha Hopes”

(3) Thursday, 25 June 2020 7:12 AM

“Morning Jonathan,

Thank you for clarifying . Unfortunately I'm not sure the re-hiring on a casual basis under jobkeeper is an option though, don't the employee have to be employed with the company before March 1st to be eligible for that?
Thanks
Ida”

(4) Thursday 25 June 2020 7:52 AM

“Morning Ida,
Hope you’re well?
I’m not sure what you mean, as you were employed before March 1st?
Would you like to talk to Michelle about it this morning?
It would be good to get it sorted this morning.

Thanks

Jonathan Hopes
Managing Director
Atom Resources”

(5) Thursday 25 June 2020 7:55 AM

“But if I’ve been terminated and then re-hires, wouldn’t that count as I’ve been employed with you since the new start date? But yes, if Michelle can give me a call this morning that’d be great.

Thanks”

(6) Thursday 25 June 2020 7:59 AM

“I’ll ask Michelle to give you a buzz :)

Jonathan Hopes
Managing Director
Atom Resources”

(7) Thursday 25 June 2020 9:09 AM

“Hi Ida,
As per conversation with Michelle, I can confirm we will be calculating your annual leave at $85,000 + Super.
Please let me know if you have anymore questions, and if not, please let me know this morning how you would like to proceed so we can prepare and organise.

Thanks

Jonathon Hopes
Managing Director
Atom Resources”

(8) Thursday 25 June 2020 9:15 AM

“Fantastic, thank you.
I’d like to go with the option of working my 4-weeks notice as per the conditions that we discussed on the phone.
Thank you for taking the time to answer all my questions :)

Ida”

[13] On 25 June 2020, approximately two hours after the last email referred to above, Mr Hopes sent the Applicant an email attaching at deed of release dated 18 June 2020 (the Deed of Release). Between 25 June 2020 and 2 July 2020, Mr Hopes and the Applicant exchanged emails regarding the Deed of Release. The Applicant made some amendments to the Deed of Release, signed it and sent it to Mr Hopes for his consideration. Arising from that email exchange, the Applicant understood that Mr Hopes would review the Amended Deed of Release and get back to her as to whether it was agreed. The Applicant did not receive any further response regarding the Amended Deed of Release, nor any copy of it signed on behalf of the Respondent.

[14] The Amended Deed of Release recorded the Applicant’s “employee termination date” as 19 June 2020, and her “employee termination effective from” date as 17 July 2020. The Applicant’s signature on the Amended Deed of Release was dated 2 July 2020.

[15] The Applicant claimed that from 2 July 2020 to 27 July 2020, she continued to receive instructions from the Respondent and continued to perform work, despite the fact that by 17 July 2020 the four-week notice period as she understood it had expired. The Respondent disputed in a general way that the Applicant was performing useful duties for at least part of that time.

[16] Other than the “employee termination effective from” date in the Amended Deed of Release of 17 July 2020, there was no clarity as to the date the redundancy would finally take effect. A four week period from the date of the Applicant signing the Amended Deed of Release would have expired on 30 July 2020.

[17] On 28 July 2020, the Applicant received an email from Mr Hopes that stated, due to unforeseen circumstances, her employment could not continue. She was requested to attend the Respondent’s offices the following day and hand in her laptop.

[18] On or 29 July 2020, the Applicant met with Mr Hopes and Ms Da Costa. The Applicant claimed that during the meeting words to the following effect were said:

Mr Hopes:	We are having a dispute with JJ [Mr Rana], we believe he has stolen our entire database and we suspect your laptop was used to do this. We can no longer have you employed by us.
The Applicant:	I don't know what you're talking about.
Mr Hopes:	We have proof that your login credentials were used to access the database and we have photographic evidence.
The Applicant:	My login credentials are the same as everyone else's here, everyone uses the admin login, everyone has the password. I have nothing to do with your dispute with JJ and I haven't stolen your database or anything like that.
Mr Hopes:	We need to withhold your last week of pay and your annual leave until this issue is resolved and our lawyer will be in touch with you to take a statement from you. As long as you say you weren't involved and Denovo say the same thing, this should all be resolved within the next week.
The Applicant:	I have nothing to do with anything like that.
Mr Hopes:	Off the record, you would still be working here if it wasn't for JJ.

[19] Mr Hopes did not include evidence regarding the above conversation in his evidence and he was not cross examined. Ms Da Costa was cross-examined about the meeting, but she denied the accuracy of the Applicant’s recollection. Her evidence was as follows:’

“Now, do you agree that the contents of that conversation as recorded there are true and correct?---No, I do not believe that they are accurate.

All right. Where do you point to inaccuracies in your evidence?---All right. So I'm not sure of the exact wording of the first one. I know that Jonathan did say that there was information that his laptop was used to access the information, "We can no longer have you employed by us", I don't have any memory of that particular line being said in that way. With previous - that was correct. And then "I don't think this - should all be resolved in the next week" - I can't confirm that that was exactly said and the last line there.

…

Yes?---No. I don't have any recollection of that being said either or any reference to it.

And what - you are specifically referring to which line?---I'm referring to the last one by Jonathan:

“Off the record you would still be working here if it wasn't for JJ.”

[20] Following the above meeting, the Applicant’s access to the Respondent’s IT systems, including her-issued email address, were removed.

[21] The Applicant claimed that after her dismissal, on or around 31 July 2020, the Respondent hired Ms Elly Stayner in a marketing role with the same responsibilities as she previously performed. The Respondent denied that Ms Stayner replaced the Applicant and noted, with documentary support, that Ms Stayner was an unpaid intern. I accept the Respondent’s evidence on this point.

[22] The Applicant claimed that had she not been dismissed, she planned to remain working at the Respondent for at least another year from the 29 July 2020. On 15 September 2020, she accepted an offer for a role as a contractor with Hays Specialist Recruitment (Australia) Pty Limited. She works three days a week and earns $720.00 per week gross.

[23] There were issues raised in the proceedings regarding non-payment of part of the notice period and leave entitlements. The parties understood that recovery of those alleged underpayments could not be pursued in the Application.

CONSIDERATION

Preliminary findings

[24] The only remaining jurisdictional objection to the Applicationbeing determined by the Commission related to whether her dismissal was a case of genuine redundancy (s.389). Otherwise, I am satisfied that:

(a) The Applicant was dismissed at the initiative of the employer (ss 385(a) 386(1)(a));

(b) Her unfair dismissal application was lodged within the 21 day statutory time limitation found at s 394(2) of the Act;

(c) The Applicant is a person protected from unfair dismissal in that she had completed the minimum employment period set out in ss 382 and 383 of the Act; and

(d) Her dismissal was not a case involving the Small Business Fair Dismissal Code (s.385(c)).

Genuine Redundancy?

[25] While I am cognisant of the Applicant’s position that the dismissal arose from allegations that she, and/or her partner, breached confidential information requirements, rather than from a redundancy, I consider it convenient to first deal with the issue of genuine redundancy. Section 389 of the Act provides:

“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.”

[26] In the Form F3 Employers Response, the Respondent conceded that the Applicant was covered by the “Clerks Award.” Clause 38 of the Clerks—Private Sector Award 2020 (the Clerks Award) provides:

“38. Consultation about major workplace change

38.1 If an employer makes a definite decision to make major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must:

(a) give notice of the changes to all employees who may be affected by them and their representatives (if any); and

(b) discuss with affected employees and their representatives (if any):

(i) the introduction of the changes; and

(ii) their likely effect on employees; and

(iii) measures to avoid or reduce the adverse effects of the changes on employees; and

(c) commence discussions as soon as practicable after a definite decision has been made.

38.2 For the purposes of the discussion under clause 38.1(b), the employer must give in writing to the affected employees and their representatives (if any) all relevant information about the changes including:

(a) their nature; and

(b) their expected effect on employees; and

(c) any other matters likely to affect employees.

38.3 Clause 38.2 does not require an employer to disclose any confidential information if its disclosure would be contrary to the employer’s interests.

38.4 The employer must promptly consider any matters raised by the employees or their representatives about the changes in the course of the discussion under clause 38.1(b).

38.5 In clause 38 significant effects, on employees, includes any of the following:

(a) termination of employment; or

(b) major changes in the composition, operation or size of the employer’s workforce or in the skills required; or

(c) loss of, or reduction in, job or promotion opportunities; or

(d) loss of, or reduction in, job tenure; or

(d) alteration of hours of work; or

(e) the need for employees to be retrained or transferred to other work or locations; or

(f) job restructuring.

38.6 Where this award makes provision for alteration of any of the matters defined at clause 38.5, such alteration is taken not to have significant effect.”

[27] It is apparent that there are three relevant considerations arising from s.389. They are:

(a) Does the person’s job no longer exist;

(b) Was there consultation about the redundancy; and

(c) Was it reasonable in the circumstances to redeploy the person.

(a) Did the Applicant’s Job no Longer Exist?

[28] In Ulan Coal Mines Ltd v Howarth, 2 a Full Bench of the Commission considered the

meaning of the term “the person’s employer no longer required the person’s job to be performed by anyone” in s.389(1)(a) of the Act. In paying particular attention to the Explanatory Memorandum, the Full Bench observed:

“Explanatory Memorandum to the Fair Work Bill 2008 provides examples as to when a dismissal will be a case of genuine redundancy.

1547 Paragraph 389(1)(a) provides that a person’s dismissal will be a case of genuine redundancy if his or her job was no longer required to be performed by anyone because of changes in the operational requirements of the employer’s enterprise. Enterprise is defined in clause 12 to mean a business, activity, project or undertaking.

1548 The following are possible examples of a change in the operational requirements of an enterprise:

•  A machine is now available to do the job performed by the employee;

•  The employer’s business is experiencing a downturn and therefore

•  the employer only needs three people to do a particular task or duty instead of five; or

•  The employer is restructuring their business to improve efficiency and

•  the tasks done by a particular employee are distributed between several

•  other employees and therefore the person’s job no longer exists.

It is noted that the reference in the statutory expression is to a person’s “job” no longer being required to be performed. As Ryan J observed in Jones v Department of Energy and Minerals (1995) 60 IR 304 a job involves “a collection of functions, duties and responsibilities entrusted, as part of the scheme of the employees’ organisation, to a particular employee” (at p. 308). His Honour in that case considered a set of circumstances where an employer might rearrange the organisational structure by breaking up the collection of functions, duties and responsibilities attached to a single position and distributing them among the holders of other positions, including newly-created positions. In these circumstances, it was said that:

“What is critical for the purpose of identifying a redundancy is whether the holder of the former position has, after the re-organisation, any duties left to discharge. If there is no longer any function or duty to be performed by that person, his or her position becomes redundant…” (at p.308)

This does not mean that if any aspect of the employee’s duties is still to be performed by somebody, he or she cannot be redundant (see Dibb v Commissioner of Taxation (2004) FCR 388 at 404-405). The examples given in the Explanatory Memorandum illustrate circumstances where tasks and duties of a particular employee continue to be performed by other employees but nevertheless the “job” of that employee no longer exists.”

[29] The Respondent’s evidence regarding the profound impact on their business of the COVID 19 pandemic was unchallenged. I accept that such impact was apparent and that a result of that downturn was that the Applicant’s job no longer existed. It seems the Applicant herself was accepting of the circumstance when told on 18 June 2020.

(b) Was there Consultation about the Redundancy

[30] It is readily apparent that the provisions of Clause 38 of the Clerks Award have their genesis in the Termination, Change and Redundancy Test Case (the TCR Case) 3. In considering other provisions similarly based on the TCR case, in Maswan v Escada,4 (“Maswan”), Vice President Watson found as follows:

“These provisions are of long standing, emanating from the Termination, Change and Redundancy test case in the early 1980s and from time to time have been reflected in legislation. The requirement to discuss proposed changes and consult about the changes has been held to require meaningful consultation and not merely an afterthought. Consultation after an irrevocable decision has been made has been held to not amount to meaningful consultation.

[20] As Sachs LJ observed in Sinfield v London Transport Executive [1970] [at 558]:

"Consultations can be of very real value in enabling points of view to be put forward which can be met by modifications of a scheme and sometimes even by its withdrawal. I start accordingly from the viewpoint that any right to be consulted is something that is indeed valuable and should be implemented by giving those who have the right an opportunity to be heard at the formative stage of proposals - before the mind of the executive becomes unduly fixed."”

(Emphasis added. Footnotes omitted.)

[31] Having made a definite decision to introduce major change, the Respondent was required to meet its obligations to consult. While not a submission made by the Applicant, I find there was a failure to consult as required by the Clerks Award.

(c) Was it reasonable in the circumstances to redeploy the person.

[32] In Ulan Coal Mines Limited v Honeysett & Ors,  5the Full Bench found as follows in relation to deployment pursuant to s.389(2):

“It may be appropriate to make some concluding remarks about the operation of s.389(2). It is an essential part of the concept of redeployment under s.389(2)(a) that a redundant employee be placed in another job in the employer’s enterprise as an alternative to termination of employment. Of course the job must be suitable, in the sense that the employee should have the skills and competence required to perform it to the required standard either immediately or with a reasonable period of retraining. Other considerations may be relevant such as the location of the job and the remuneration attaching to it. Where an employer decides that, rather than fill a vacancy by redeploying an employee into a suitable job in its own enterprise, it will advertise the vacancy and require the employee to compete with other applicants, it might subsequently be found that the resulting dismissal is not a case of genuine redundancy. This is because it would have been reasonable to redeploy the employee into the vacancy. In such a case the exception in s.385(d) would not apply and the dismissed employee would have the opportunity to have their application for a remedy heard. The outcome of that application would depend upon a number of other considerations.

Where an employer is part of a group of associated entities which are all subject to overall managerial control by one member of the group, similar considerations are relevant. This seems to us to be a necessary implication arising from the terms of s.389(2)(b). While each case will depend on what would have been reasonable in the circumstances, subjecting a redundant employee to a competitive process for an advertised vacancy in an associated entity may lead to the conclusion that the employee was not genuinely redundant.”

[33] There existed a genuine need to reduce the workforce of the Respondent. It was not a circumstance where redeployment of the Applicant could have been considered.

Conclusion on Genuine Redundancy.

[34] The Applicant’s job no longer existed, and it was not a circumstance where redeployment of the Applicant could have been considered. However, the Respondent’s failure to consult in accordance with the Award provisions results in a conclusion that the dismissal was not a genuine redundancy as defined by the Act.

Was the Dismissal Harsh, Unjust or Unreasonable?

[35] Having concluded that the dismissal was not a genuine redundancy, I must consider the question of whether the Applicant’s dismissal was ‘harsh, unjust or unreasonable’ and therefore an unfair dismissal, pursuant to the considerations outlined in s.387 of the Act, dealing with the matters to be taken into account by the Commission in determining whether the dismissal was unfair.

[36] Section 387 of the Act identifies the matters that the Commission must take into account in deciding whether a dismissal was “harsh, unjust or unreasonable:”

(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.

(a) Valid reason

[37] This consideration requires a determination of the reason for dismissal, which as noted above involved a contest between the Respondent stating the Applicant was terminated on the ground of redundancy, and the Applicant asserting the dismissal arose from allegations of breach of confidential information by her and her partner.

[38] Section 387(a) of the Act regarding the matter of whether there was a valid reason for the dismissal related to the person’s capacity or conduct does not go to the process for selecting the person for redundancy. If I were to find the dismissal was on the ground of redundancy, it would be a neutral matter with respect to the consideration of whether the Applicant’s dismissal was harsh, unjust or unreasonable.

[39] As to a valid reason arising from allegations of breach of confidential information, such a reason could form a valid reason as being sound, defensible and well-founded, but I would also have to determine whether that conduct occurred and what it involved. The Full Bench of the Commission found in Sydney Trains v Hilder:  6

“The principles applicable to the consideration required under s 387(a) are well established, but they require reiteration here:

(1) A valid reason is one which is sound, defensible and well-founded, and not capricious, fanciful, spiteful or prejudiced.

(2) When the reason for termination is based on the misconduct of the employee the Commission must, if it is in issue in the proceedings, determine whether the conduct occurred and what it involved.

(3) A reason would be valid because the conduct occurred and it justified termination. There would not be a valid reason for termination because the conduct did not occur or it did occur but did not justify termination (because, for example, it involved a trivial misdemeanour).

(4) For the purposes of s 387(a) it is not necessary to demonstrate misconduct sufficiently serious to justify summary dismissal on the part of the employee in order to demonstrate that there was a valid reason for the employee’s dismissal (although established misconduct of this nature would undoubtedly be sufficient to constitute a valid reason).

(5) Whether an employee’s conduct amounted to misconduct serious enough to give rise to the right to summary dismissal under the terms of the employee’s contract of employment is not relevant to the determination of whether there was a valid reason for dismissal pursuant to s 387(a).

(6) The existence of a valid reason to dismiss is not assessed by reference to a legal right to terminate a contract of employment.

(7) The criterion for a valid reason is not whether serious misconduct as defined in reg 1.07 has occurred, since reg 1.07 has no application to s 387(a).

(8) An assessment of the degree of seriousness of misconduct which is found to constitute a valid reason for dismissal for the purposes of s 387(a) will be a relevant matter under s 387(h). In that context the issue is whether dismissal was a proportionate response to the conduct in question.

(9) Matters raised in mitigation of misconduct which has been found to have occurred are not to be brought into account in relation to the specific consideration of valid reason under s 387(a) but rather under s 387(h) as part of the overall consideration of whether the dismissal is harsh, unjust or unreasonable.”

[40] Where notice of termination is given, but the employee works out the notice period, the employment contract remains of foot until the conclusion of that notice period. 7 If the employer becomes aware of conduct that would justify summary termination before the expiry of the notice period, the employer would be able to terminate the employee for such misconduct prior to the expiry of such notice. However, once the original notice period has expired, and termination has occurred, an employer cannot thereafter elect to dismiss on the basis of summary dismissal. As the Full Court of the Federal Court found in Sautner v Melbourne Stadiums Ltd:8

“We do not consider that Shepherd supports MSL’s contention that a lawfully terminated agreement, in effect, may be resuscitated and then re-terminated upon some ground not known at the time of the termination. An agreement may be terminated lawfully for any number of reasons: resignation of the employee; redundancy; effluxion of the contractual term of employment or some other contractual basis. A contract cannot be terminated twice”

[41] From 18 June 2020, until Monday 27 July 2020, the dismissal of the Applicant due to redundancy was proceeding. As the Applicant was given, and accepted, four weeks notice of her dismissal, the date the dismissal takes effect will be generally at the end of that four week period.

[42] In the OOT Decision, I found as follows: 9

“Bearing in mind all the materials between the parties it seems clear that the respondent [accepted] the applicant was working at least up until 24 July 2020, which I note was a Friday, and it would be most likely that she would have still been employed on 27 July 2020 as she claims. While the respondent asserts that the applicant was not performing her full duties or appropriate duties during her four week notice period that was agreed. That does not have an effect on the date upon which the termination took effect.

I formally find then that the termination took effect on 27 July 2020 and as a result the application was therefore not lodged outside the time prescribed and there is no jurisdictional barrier to the application proceeding to be heard.”

[43] I note, however, that on 28 July 2020, the Applicant received an email from the Respondent that advised that due to unforeseen circumstances, her employment could not continue, and the following day the meeting of 29 July 2020 occurred, wherein the evidence of each party is that the Applicant was told "We can no longer have you employed by us."

[44] In light of my conclusion in the OOT Decision, the Respondent’s email communication of 28 July 2020, and statement in the meeting of 29 July 2020, would appear to relate to the issue of whether further employment, as alluded to in the emails of 12.51pm and 2.54pm on 24 June 2020, would occur.

[45] Having found that the dismissal occurred on 27 July 2020, the reason for dismissal was redundancy. As noted above, a valid reason for the dismissal related to the person’s capacity or conduct does not go to the process for selecting the person for redundancy, and so it would be a neutral matter with respect to the consideration of whether the Applicant’s dismissal was harsh, unjust or unreasonable.

[46] Were I to have found that the dismissal related to allegations of breach of confidential information by the Applicant and her partner, I would have found that such reason could constitute a valid reason, but in this matter did not constitute a valid reason as the Respondent had completely failed to substantiate the conduct occurred or what it involved.

[47] Nonetheless, as noted below in the calculation of compensation, either reason for dismissal would have resulted in the same compensation being awarded.

(b) Notification

[48] The Applicant was notified of the of the reasons for redundancy in the meeting of 18 June 2020.

(c) Opportunity to Respond

[49] Section 387(c) is predicated on there being a reason for dismissal related to the capacity or conduct of the employee. It follows that s 387(c) is a neutral factor in relation to the question of whether the Applicant’s dismissal was harsh, unjust or unreasonable.

(d) Support person

[50] The Applicant did not request to have a support person, though that is very likely explained by the fact that she was not aware of any meeting occurring. Nonetheless, as no request was made I consider this a neutral consideration.

(e) Warnings

[51] The Applicant’s actual dismissal related to redundancy, and not to her unsatisfactory performance, so this matter is not relevant to my consideration as to whether the Applicant’s dismissal was harsh, unjust or unreasonable.

(f/g) Size of the business/human resources

[52] These are not relevant considerations as the Respondent is a company that has some Human Resource capabilities in the form of Ms Da Costa.

(h) Other relevant matters

[53] There were sound, defensible and well-founded reasons for the Applicant’s dismissal, relating to the downturn in business suffered by the Respondent, and it was not reasonable in all the circumstances to relevantly redeploy her. Those are matters telling against a conclusion that the dismissal was harsh, unjust or unreasonable.

[54] The Respondent, however, failed to consult with the Applicant as required by the Clerks Award that applied to her employment. In the circumstances the failure to so consult was unreasonable. I regard the failure to consult as a matter relevant to the conclusion that the Applicant’s dismissal was harsh, unjust or unreasonable.

Conclusion on Dismissal

[55] Taking into account the matters referred to above, the dismissal of the Applicant was harsh unjust or unreasonable. While the Respondent had a valid reason to reduce its workforce, and it was dealing with the very difficult business environment in March/April 2020, the Respondent’s failure to comply with its consultation obligations in relation to the Applicant meant that the Applicant was denied the opportunity to secure a different outcome. I will therefore consider remedy.

Remedy

[56] The Applicant’s submissions on remedy were finally put as follows: 10

“Finally, in closing, we essentially say that in the first instance the applicant should be entitled to such compensation as the Commission thinks fit. Certainly we say that the applicant would have remained working at Atom had it not been for the turn of events of the redundancy and then the alleged - or the alleged misconduct termination, would have continued to work for Atom and had plans, on her evidence - and clearly had plans to remain working for Atom for the foreseeable future.

So we say that compensation should be ordered as highly as it can be ordered for someone whose otherwise permanent employment was cut short unfairly, harshly, unjustly and unreasonably.

…

That's in the first instance, where the applicant seeks compensation. In the second instance, if the Commission is not minded to award compensation, we do say in our written submissions that reinstatement is possibly not the best remedy in these circumstances. It would be remiss on anyone to think that Ms Wange hasn't left the respondent's business with some level of acrimony or distrust. Certainly allegations are being made on each side about misconduct and what he said and what she said.

Having said that, if the Commission is not minded to order compensation, then we say that the applicant simply can't walk away without a remedy in these circumstances where we say it's very clear that there's been an unfair dismissal, and so we would say that reinstatement should be considered if compensation is not considered, and if that is the case, then the Commission, we say, should award some form of back pay in relation to the period from the dismissal to the date of reinstatement by the Commission, if the Commission is so minded to do.”

(a) Reinstatement

[51] Contrary to the Applicant’s submission, reinstatement is the primary remedy available under the Act. Compensation cannot be ordered unless the Commission has first found reinstatement to be inappropriate. 11 Additionally, reinstatement must have been sought under s.394 of the Act.12

[57] In her Form F2 the Applicant did not seek reinstatement, and the Respondent had no opportunity to lead evidence regarding reinstatement. It was only agitated in closing submissions, impermissibly, as an alternative to compensation because the Applicant “simply can't walk away without a remedy.” That submission is entirely inconsistent with the Act.

[58] In light of the significant downturn in business suffered by the Respondent, I am satisfied that the reinstatement of the Applicant is inappropriate. That is particularly so where the dismissal was brought about by a redundancy.

(b) Compensation

[59] The criteria relevant to the deciding of the amount of compensation are set out in s.392(2). That section provides:

“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.”

I address below those criteria in the customary order of consideration. 13

(i) Remuneration that would have been received (s.392(2)(c))

[60] The Applicant claimed that had she not been dismissed, she planned to remain working at the Respondent for at least another year from the 29 July 2020. How that could be so when she had understood “the situation” of her redundancy and negotiated the notice periods of her imminent termination is beyond comprehension. While the submission may result in a higher compensation award for the Applicant, it has absolutely no basis in fact.

[61] I am of the view that the remuneration the Applicant would have received, or would have been likely to receive, if she had not been dismissed would have been another two weeks’ remuneration. Two weeks is the period it would have taken the Respondent to comply with its obligations in the Agreement to consult with the Applicant about the redundancy that led to her dismissal. The agreed notice periods would have then operated from that time.

[62] If I was wrong in my determination of valid reason, and the the dismissal of the Applicant related to allegations of breach of confidential information by the Applicant and her partner, it would have had no effect on the compensation award. That is because the Applicant’s employment would have nonetheless have terminated on the ground of redundancy on or about 27 July 2020, with that date extended by two weeks to accommodate the prior appropriate consultation.

(ii) Remuneration earned (s.392(2)(e))

[63] The Applicant did not obtain alternate employment until 15 September 2020, when she accepted a role as a contractor with Hays Specialist Recruitment (Australia) Pty Limited. She works three days a week and earns $720.00 per week gross. I do not deduct that from the amount ordered as the Applicant.
.

(iii) Income reasonably likely to be earned (s.392(2)(f))

[64] I make no deduction for any amount of income reasonably likely to be so earned by the Applicant. The two weeks following her dismissal does not extend to the period referred to in s.392(2)(f).

(iv) Other matters (s.392(2)(g))

[65] There are no other matters that I consider relevant to take into account in the determination of an amount of compensation in lieu of reinstatement for the Applicant, part from those in ss.392(2)(a), (b) and (d), s.392(3) and s.395(5) of the FW Act to which we next refer.

(v) Viability (s.392(2)(a))

[66] No submission was made on behalf of the Respondent that any particular amount of compensation would affect the viability of the Respondent’s enterprise. Accordingly, no adjustment will be made on this account.

(vi) Length of service (s.392(2)(b))

[67] The Applicant most recently only had continuous service of one year with the Respondent. Such a period of service does not justify any adjustment to the amount of compensation.

(vii) Mitigation efforts (s.392(2)(d))

[68] I accept that the Applicant has made reasonable efforts to mitigate the loss suffered by her because of her dismissal. Her mitigation efforts do not provide a basis for reducing the amount of compensation.

(viii) Misconduct (s.392(3))

[69] Proven misconduct did not contribute to the Respondent’s decision to dismiss the Applicant. As a result, I do not reduce the amount of compensation on this ground.

(xi) Compensation cap (s.392(5))

[70] The amount of two weeks pay plus superannuation is less than the compensation cap in s.392(5) of the FW Act for the Applicant.

Conclusion as to Remedy

[71] I am satisfied an order for the payment of compensation of two weeks pay plus superannuation, less taxation as required by law, by the Respondent to the Applicant in lieu of reinstatement is appropriate in all the circumstances of the case. It accords a fair go all round to both the Respondent to the Applicant. An order to this effect is attached.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR727575>

 1   Form F2 at Q.2.1.

 2   [2010] FWAFB 3488 at [16] and [17].

 3 (1984) 8 IR 34; (1984) 9 IR 115.

 4   [2011] FWA 4239, at [19] and [20].

 5   [2010] FWAFB 7578 at [34] and [35].

 6   [2020] FWCFB 1373, at [26].

 7   Sautner v Melbourne Stadiums Ltd [2015] FCAFC 20 at [134].

 8 [2015] FCAFC 20 at [112].

 9   Transcript PN 664 to 665.

 10   Transcript PN 389, 390, 393 and 394.

 11   S.390(3)(a) of the Act.

 12   S.390(2) of the Act.

 13   Sprigg v Paul’s Licensed Festival Supermarket (1998) 88 IR 21.