Isabel De Ramirez v Inner West Skills Centre Inc t/as Inner West Skills Centre (In Liq) (No. 2)
[2015] FWC 7983
•20 NOVEMBER 2015
| [2015] FWC 7983 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s 394 - Application for unfair dismissal remedy
Isabel De Ramirez
v
Inner West Skills Centre Inc t/as Inner West Skills Centre (In Liq) (No. 2)
(U2015/3754)
DEPUTY PRESIDENT SAMS | SYDNEY, 20 NOVEMBER 2015 |
Termination of employment – application for unfair dismissal remedy – respondent in liquidation – applicant granted leave by the New South Wales Supreme Court to proceed with application subject to conditions – application not defended by respondent or liquidator – evidence of applicant and other persons accepted – dismissal substantively and procedurally unfair – reinstatement inappropriate – further leave by Court required to enforce orders - whether order for compensation of any utility – further directions.
[1] This decision deals with an unfair dismissal application, lodged by Ms Isabel De Ramirez (the ‘applicant’) on 6 March 2015, following her termination of employment by Inner West Skills Centre Inc t/as Inner West Skills Centre (IWSC or the ‘respondent’) on 13 February 2015. Relevantly, the respondent was placed into voluntary liquidation on 22 May 2015.
[2] Following a jurisdictional hearing of the matter on 24 June 2015, I stayed the applicant’s unfair dismissal application pending either, the granting of leave by a Court to proceed with the application, pursuant to s 500(2) of the Corporations Act 2001 or the discontinuance of the proceedings by the applicant; See: Isabel De Ramirez v Inner West Skills Centre Inc t/as Inner West Skills Centre[2015] FWC 4263.
[3] On 26 June 2015, the Supreme Court of New South Wales (the ‘Supreme Court’) issued an Order in the following terms:
‘On the undertaking of the plaintiff to pay the filing fee give leave to file in court the originating process together with the plaintiff’s affidavit dated 26 June 2015.
Order pursuant to s 500(2) of the Corporations Act 2001 (Cth) as applied by s 64(2)(a) of the Associations Incorporations Act 2009 (NSW) that the plaintiff have leave to proceed with her application in proceeding no U2015/3754 in the Fair Work Commission against Inner West Skills Centre Inc (“the Company”), on condition that the plaintiff not seek to enforce any judgment or award against the assets of the Company without further leave of the Court.’
[4] Following advice of this Order, I issued directions for the parties, including the respondent’s liquidator, BRI Ferrier (NSW) Pty Ltd Chartered Accountants (‘BRI Ferrier’), to file and serve any evidence or materials on which they relied, in respect to the question of whether the applicant’s dismissal was ‘harsh, unjust or unreasonable’, within the meaning of s 387 of the Act. The matter was listed the matter for hearing on 11 September 2015.
[5] Following the issuing of those Directions, BRI Ferrier wrote to my chambers in the following terms:
‘I refer to the Directions issued by the Fair Work Commission (“FWC”) on 7 July 2015 and to my letter to you dated 23 June 2015 (“Previous Letter”). …
I understand that on 26 June 2015, the Supreme Court of New South Wales (“the Court”) granted leave in favour of Ms Isabel de Ramirez to proceed with her application in the aforementioned proceedings against the Association. …
Following the Court’s leave, I received a copy of the FWC’s Directions requesting that the Association to file [sic]an outline of submissions for the upcoming hearing on the matter set for 11 September 2015. In this regard, I refer you to my Previous Letter advising that there are insufficient funds and evidence available in the Liquidation for the Association to be represented in this matter. Accordingly, I confirm that the Association will not be filing any further submissions, nor will it be represented at the upcoming hearing.
I understand that the matter will continue in the absence of any submissions or appearance from the Association. As per my Previous Letter, I agree to be bound by the decisions of the FWC and the Court.
I note that the order of 26 June 2015 requires Ms de Ramirez to obtain further leave from the Court in relation to any judgement that she may be awarded against the Association. In this regard, I note that the normal priorities set out in Sections 556(1)(e)-(h) of the Corporations Act 2001 will apply to any judgement made in favour of Ms de Ramirez.
Per my previous letter, I confirm that I do not anticipate that there will be sufficient funds to pay all employee entitlements owed by the Association; rather only wages and superannuation liabilities (or part thereof) may be discharged.
In respect of other entitlements, the former employees, including Ms de Ramirez (if successful), may be entitled to claim through the Department of Employment’s (“DOE”) Fair Entitlements Guarantee (“FEG”) scheme. Again, the DOE forms their own decision as to which entitlements they will ultimately fund, and I encourage Ms de Ramirez to make her own enquiries as to whether her “potential” claim would be acceptable to the DOE under the FEG scheme.
Please note that the FEG scheme does not cover superannuation claims. As such, any return on outstanding superannuation will come from the Association by way of dividend, to the extent that funds are available [emphasis as in original].’
[6] At the hearing on 11 September 2015, the applicant was represented by Ms A Gibbons of Counsel, with permission having previously been granted, pursuant to s 596 of the Act. As foreshadowed, neither the respondent or its liquidator appeared or were represented.
THE EVIDENCE
[7] Witness statements from the following persons were filed in support of the applicant’s case:
- the applicant;
- Ms Rose Guisa, a former employee of the respondent;
- Mr Thomas Piotrowski, formerly a Psychologist for the respondent; and
- Mr Clyde Livingstone, Former Chairman of the Board of the respondent.
As there was no appearance for the respondent and obviously no contradictor to this evidence, I intend to accept this evidence in determining this matter.
The applicant
[8] In her evidence, the applicant set out a number of roles in which she had worked, and training she had undertaken, since commencing her employment with the respondent in July 2007. Following the unexpected death of the respondent’s CEO, a new CEO, Ms Cheryl Williams, was appointed in September 2014. From November 2014, a number of employees were made redundant and/or were dismissed.
[9] The applicant described a number of meetings she had with Ms Williams in December 2014, in which Ms Williams questioned her as to whether existing staff remained in contact with staff, who had been made redundant or had been dismissed. While the applicant said she was unaware of any such contact, she felt uncomfortable by this questioning. In late December 2014, the applicant met with Ms Williams and Mr Mark Zaia, Programs Manager. The applicant agreed with the respondent’s proposal to undertake a temporary three month secondment to IWSC’s Disabilities Employment Services Department. Ms Williams told her that if she did not like the role, she could return to her role in the Training Department. She commenced in the new role, on or about 29 December 2014. This was confirmed in a letter dated 5 January 2015. However, she was not given a revised position description or any new key performance indicators.
[10] The applicant explained that on, or about 27 January 2015, there were major renovations in the office area in the workplace. Mr Zaia asked her to assist with an archival filing task. She agreed to do so. Mr Zaia advised her, the following day, that he was ready to commence with that task. Ms Williams told her that she wanted the ‘filing done alphabetically.’ The applicant agreed, assuming that she meant filing alphabetically within a ‘class’, in accordance with past practice. She and Mr Zaia and another co-worker completed the archival filing in this fashion. She denied that Mr Zaia directed her to do it in any other manner. The following day, the applicant was directed to attend Ms Williams’ office for a meeting with herself and Ms Wendy Lipski, Finance Manager. A conversation took place in words to the following effect:
Ms Williams: | You failed to follow my instructions with regard to the filing you did yesterday. |
Applicant: | Goodness, I understood that you meant to file alphabetically within class. It would take me about half an hour to redo the boxes. |
Ms Williams: | There is no need to do that, you will get a letter by email. |
Applicant: | I will do it in my own time. |
Ms Williams: | No. |
[11] The applicant said that she then left the office and as she closed the door, Ms Williams and Ms Lipski ‘broke into laughter’. The applicant described feeling humiliated, embarrassed, shocked and confused. She was handed a letter dated 2 February 2015 in the following terms:
‘This letter is in reference to some concerns, which we have had some initial discussions about in regarding your performance.
A meeting has been organised to give you the opportunity to discuss, respond and defend yourself in relation to the allegation in more detail.
The allegations are:
● On Wednesday the 28th January you failed to follow instructions in regard to archiving training files. Despite being asked to file the documents in alphabetical order you chose to disregard the instruction and filed them in ‘class order’. You also filed to follow the instruction to NOT file the documents in ‘class order.’
On two occasions Mark Zaia, reinforced the directive that files needed to be filed alphabetically.
As discussed with you the cost of failing to follow this directive has created delays in the archiving process and the cost of redoing all of the work.
This however is not the first discussion you have had in regard to your performance. Similar issues previously discussed are:
● Failing to take the directive from Mark in regard to NOT interviewing clients in the middle of the office
● Failing to follow a directive to clear and file all documents on your desk and in boxes surrounding your desk.
● Failing to follow a directive in regard to not calling Renee Kemplin when asked by BJ.
You are directed to attend a formal ‘right of reply’ meeting to be held on Thursday 5th Feb 2014 [sic] at 11am at the IWSC Burwood office with Finance Manager Wendy Lipski and myself.
You are invited to have a personal representative present at the meeting. Please advise me prior to the meeting the name of your support person.
If we are able to satisfactorily resolve the concerns, there may not be any need for further action. However, if we are not able to satisfactorily resolve the concerns, the outcome of this meeting may be disciplinary action, which could include a warning or termination of employment.
If you have any questions or queries about this process, please contact me to discuss.’
[12] The applicant denied she had acted in an inappropriate, intimidatory or unprofessional manner after receiving this letter. She had never had any performance issues in the 7½ years of her employment with the respondent. She had contacted the Commission and WorkCover during her lunch break. She described the archiving issue as an isolated incident and noted that she had immediately offered to remedy the error.
[13] The applicant described a subsequent performance management process as ‘contrived’. She believed she was meeting her contract requirements and she had, in fact, been paid a lump sum bonus payment, due to her job target achievements. She had received positive performance assessments in the past.
[14] As to an allegation that she had interviewed clients in the middle of the office, the applicant explained that there were four employees working in a space the ‘equivalent of a corridor’. Mr Zaia’s room was the only one with a working computer in which to interview clients. She had had discussions with clients at her desk and would assist them with job searches and the creation of resumes and covering letters while waiting for the room to become free. She would assist if a client reported issues with a computer or report it to IT. From 3:00pm, she would ordinarily perform relief reception duties. In January 2015, she had a conversation with Mr Zaia in words to the effect of:
Mr Zaia: | You are using the interview room to interview clients? |
Applicant: | Of course yes but I do some non-private/personal inquiries at my desk. |
Mr Zaia: | That’s fine it will not be long until we have enough rooms available. |
Applicant: | I am looking forward to that. |
In February 2015, new offices with computers were made available.
[15] The applicant denied that she had failed to comply with a direction to clear her desk. She had done this over a week, by downsizing eleven boxes to six, then to four, then to three, then to two. On the second day of this process, Mr Zaia asked how the process was going. She had replied that she expected to finish shortly and she was almost done. She believed Mr Zaia accepted this explanation. It would have been apparent that she was reducing the boxes around her desk. However, she was unable to clear the last two boxes, as she was asked to assist with the archival task by Mr Zaia.
[16] The applicant denied the allegation that she failed to comply with a direction of Mr Bejan Safi not to call Ms Rene Kemplen. Ms Kemplen had already been terminated by the time Mr Safi had advised her not to contact her, which was after the applicant had emailed Ms Kemplen. She had provided email evidence of this to Ms Williams, but had not received a response.
[17] The applicant said that when she arrived at work on Monday 3 February 2015, Ms Williams called her into the office and directed her to leave the building, hand over her keys and not take anything from her desk. Ms Williams declined her request to collect personal effects and told her that she was suspended immediately, due to ‘yesterday’s behaviour’. However, she did not indicate if she was on full pay or not. The applicant complied with these directions and left immediately. After leaving, she contacted Mr Clyde Livingstone, the Chairman of the Board and met with him later that day. He advised that while Ms Williams had directed that she be suspended without pay, he had organised for her to be paid during her suspension.
[18] The applicant received email correspondence on 3 February 2015 directing her to attend a meeting with an independent investigator, Mr Brian O’Neill. She met with Mr O’Neill on 6 February 2015 and handed him a letter. She did not accept the following findings in his subsequent report, dated 10 February 2015:
‘[Ms Williams] acted in a professional, polite and calm manner towards Isabel Ramirez. There is no evidence to suggest otherwise…
… I have formed the view that the evidence against Isabel on balance is quite substantial and is to be believed. I formed the view that the evidence of Isabel is somewhat wanting. It is clear from the evidence that Isabel has great difficulty in following directions at work and seems to want to do things her way. That is the base of the problem… These actions must cause considerable concern to the CEO and the organization. People in the workplace are required to behave in a proper manner and to be capable of following required directions from management.’
[19] The applicant complained that she had not received a copy of Mr O’Neill’s report at the time and she was unaware as to whether the relevant witnesses were interviewed. Ms Kemplen was not asked as to the nature of the applicant’s contact with her. The applicant did not believe the process was transparent or independent.
[20] The applicant received a letter terminating her employment, dated 13 February 2015, which was expressed as follows:
‘I confirm that I have reviewed the report prepared by Mr O’Neill in respect of the investigation which he undertook.
I have also reviewed and considered other relevant materials, including your letter to me of 5 February 2015.
By way of brief background, I wrote a letter to you on 2 February outlining my concerns with certain aspects of your work performance. I advised that a meeting had been scheduled to discuss these matters in further details.
Your behaviour upon receipt of that correspondence caused further issues to be raised with you, which I particularised in my letter to you of 4 February 2015.
A process was then put in place to review the totality of those matters. You were stood down on full pay while that process was underway.
Had the matters in question been dealt with in the usual way, there was an expectation that you would have received a warning together with a requirement to do your work in an improved manner, with regard to specific issues.
However, consequent upon your receipt of the notification of the matters to be addressed, you wrote a letter to me, expressing yourself in vitriolic terms and demonstrating a rift in the working relationship between me and you.
The matters raised in your correspondence of 5 February were dealt with during the course of Mr O’Neill’s investigations and his discussions with other employees who work in your immediate vicinity.
None of the matters which were raised by you as factual incidents were found by Mr O’Neill to be correct.
There being, in my opinion, no way that the employment relationship between me and you can be adequately repaired, it is in the best interest of the organisation that your employment be terminated today by the giving of four weeks’ notice.
Further to this, the organisation does not require you to work out your period of notice and you should not return to the premises.
Any personal items will be packaged up and returned to you and appropriate payment of your entitlements will be made to your bank account.’
[21] The applicant specifically denied there was a continued or real failure by her to follow management directions. She had participated in the investigation in a forthright and honest manner. She had been humiliated and embarrassed. She believed she could have been returned to the workplace. She had never been counselled by her manager. The applicant believed that Ms Williams had embarked on a process to reduce the number of employees at the Company, as a number of employees had already been terminated or made redundant. There was no just reason for her dismissal.
Ms Rose Guisa
[22] Ms Guisa was employed by the respondent at the time she provided her statement. She had been employed by the respondent at the same time as the applicant and had known her for 7½ years. She had never felt threatened, bullied or intimidated around the applicant. On the contrary, she described the applicant as honest, hardworking and approachable, with excellent problem-solving skills and great patience. She was calm and professional at all times. Ms Guisa was aware of times in which the applicant had diffused hostile situations.
Mr Thomas Piotrowski
[23] Mr Piotrowski provided a document described as a character reference in support of the applicant’s case. He had been employed as a Psychologist by the respondent from July 2013 to February 2015 and had worked directly with the applicant for three months. He had subsequently maintained contact with her.
[24] Mr Piotrowski expressed surprise at any assertion by the respondent that the applicant was a danger to others. On the contrary, he described her as trustworthy, professional and with a strong work ethic. He had observed her behaving in a professional and respectful manner at all times.
Mr Clyde Livingstone
[25] Mr Livingstone is the former Chairman of the respondent’s Board. He also provided a document expressed as a character reference for the applicant. He has known the applicant since she commenced employment with the respondent in 2007.
[26] Mr Livingstone described the allegations against the applicant as ‘uncharacteristic and inconsistent with her professional reputation.’ Reports to him by management had described her as hardworking and dedicated. The files of the respondent demonstrated that the applicant had received accolades, bonuses, pay rises, management training and promotions. He had never heard any negative feedback in relation to her client-based work.
[27] Mr Livingstone said he was surprised to hear that the applicant had been suspended, then dismissed from her employment. He had offered to mediate between the applicant and Ms Williams, but this offer was repeatedly declined by Ms Williams. He had been told that the investigator hired by Ms Williams, was a former associate of hers.
[28] Mr Livingstone believed that the applicant’s termination was poorly handled by Ms Williams. After her dismissal, the Board had met in order to review and amend the respondent’s Personal Grievance Policies and Procedures in order to guard against a similar situation arising in the future. It was also proposed that the Board take a more active role in future recruitment.
SUBMISSIONS
[29] Ms Gibbons made oral submissions at the hearing on 11 September 2015. She relied particularly on the evidence of Mr Livingstone as establishing that the applicant was not afforded procedural fairness or natural justice. While the respondent, in particular, Ms Williams had embarked on a process in the lead up to the applicant’s dismissal, it was not a fair process, despite Mr Livingstone offering suggestions to make the process fairer. The dismissal had had a negative impact on the applicant’s reputation.
[30] Ms Gibbons submitted that the evidence demonstrated that the applicant was an exemplary employee. Ms Williams had made bare assertions about the applicant’s performance and conduct, which were not supported by the evidence. She suggested that Ms Williams had ultimately dismissed the applicant because she had an ‘axe to grind’.
[31] Ms Gibbons explained that the applicant sought reinstatement in order to remedy any injury to her reputation. It would also affect her entitlement to the Fair Entitlement Guarantee (FEG). However, after some discussion with the Bench, particularly in relation to Blackadder v Ramsey Butchering Services Pty Ltd (2005) 221 CLR 539 (‘Blackadder’), Ms Gibbons no longer pressed the applicant’s reinstatement.
CONSIDERATION
[32] At this juncture, pursuant to s 396 of the Act, I dispose of any preliminary issues by making the following findings:
(a) the applicant was a national system employee and the respondent is a national system employer, as defined (ss 13, 14);
(b) the applicant’s unfair dismissal application was lodged within the 21 day statutory time period set out in s 394(2)(a) of the Act;
(c) as the respondent is not a small business, the Small Business Fair Dismissal Code is not relevant in this case (s 396(c));
(d) the applicant’s dismissal was not a case of genuine redundancy (ss 382, 396(d));
(e) the applicant was a person protected from unfair dismissal in that:
(i) she had completed the minimum employment period (s 383); and
(ii) her rate of earnings was less than the high income threshold (ss 382(b)(iii),
The only matter remaining to be determined by the Commission is whether the applicant’s dismissal was ‘harsh, unjust or unreasonable’ (s 385(b)), within the meaning of s 387 of the Act. It is to these matters to which I now turn.
[33] Section 387 of the Act sets out the criteria that the Commission must consider in determining whether a dismissal was ‘harsh, unjust or unreasonable’. It is expressed as follows:
387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that the FWC considers relevant.
[34] The meaning of the phrase ‘harsh, unjust and unreasonable’ is to be found in the well-known quote from Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410, where McHugh and Gummow JJ said:
‘It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted’.
[35] As mentioned earlier, the only evidence presented in this case was evidence in support of the applicant’s case. As this evidence has not been contradicted, that evidence stands unchallenged. Accordingly, I accept the denials by the applicant of the allegations in relation to her conduct and performance. I also accept her description of the unfair process embarked on by the respondent leading up to her dismissal. While the evidence provided by Ms Guisa, Mr Piotrowski and Mr Livingstone as to the applicant’s work performance, character and demeanour was uncontested, their evidence was consistent with, and corroborated the applicant’s claims of unfairness as to her dismissal and the real reasons for it. More relevantly, I accept Mr Livingstone’s evidence that he had sought to assist in relation to the dispute between Ms Williams and the applicant and that the Board amended its grievance policy in response to the process that led to the applicant’s dismissal. This evidence tends to support the applicant’s claims of procedural unfairness. I turn now to specifically address the criteria set out in s 387 of the Act.
Was there a valid reason for the applicant’s dismissal (s 387(a))?
[36] A ‘valid reason’ must be ‘sound, defensible and well founded’, as set out in the judgement of Northrop J in Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, in which His Honour said:
‘In its context in s 170DE(1), the adjective “valid” should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s.170DE(1). At the same time the reasons must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must “be applied in a practical, commonsense way to ensure that the employer and employee are treated fairly.’
[37] As I have accepted the applicant’s denial of the allegations as to her conduct and performance, it follows that I am satisfied that there was no valid reason for dismissal. Moreover, in my opinion even if the reasons for dismissal, expressed by Ms Williams in her letter of 2 February 2015 were true, they all seem relatively innocuous or trivial. On their face, they certainly do not seem to me to form a sound basis for serious disciplinary action, let alone dismissal.
Was the applicant notified of the reason(s) for her dismissal (s 387(b))?
[38] The applicant was allegedly notified of the reasons for her dismissal in the dismissal letter dated 13 February 2015, which referred to the investigation of Mr O’Neill. I accept the applicant’s evidence that she was not given a copy of the outcome of Mr O’Neill’s report at the relevant time. Accordingly, I am not satisfied that the applicant was properly notified of the reasons for her dismissal. This factor weighs in favour of a finding that the dismissal was procedurally unfair.
Was the applicant given an opportunity to respond to any reason related to her capacity or conduct (s 387(c))?
[39] After the incident relating to archiving of training files on 28 January 2015, the applicant was called into a meeting with Ms Williams on 2 February and then attended what Ms Williams described as a ‘right of reply’ meeting on 5 February 2015. The applicant was placed on a performance improvement plan (described by the applicant as ‘contrived’), was subject to an investigation by a third party (whose independence was questioned by the applicant) and dismissed on 13 February 2015. While it appears that there was a nominal attempt to provide the applicant with an opportunity to respond, the relatively short period between the 2 and 13 February and the applicant’s suspicions as to the independence of Mr O’Neill, raises some doubt as to the genuineness of the process, such as to raise a question as to whether the respondent was merely paying ‘lip service’ to giving the applicant a real and genuine opportunity to respond; See: Wadey v Y.M.C.A. Canberra [1996] IRCA 568. This weighs in favour of a finding that the dismissal was procedurally unfair.
Was there an unreasonable refusal by the respondent to have a support person present (s 387(d))?
[40] On the evidence before the Commission, there was no refusal by the respondent to allow the applicant to have a support person present at the relevant meetings. This is a neutral factor in my consideration.
Was the applicant warned about unsatisfactory performance (s 387(e))?
[41] I accept the applicant’s evidence that she was not warned about her performance, prior to February 2015. I also accept Mr Livingstone’s evidence that the respondent’s personnel files record that the applicant was a valued, hardworking employee. Even if I did not accept the applicant’s evidence that there were no issues with her performance, the relatively short period between 2 February 2015 and the applicant’s dismissal on 13 February 2015, suggests that the applicant was not given any reasonable opportunity to address and remedy any performance issues. As I said earlier, Ms Williams’ issues were trivial, at best.
The degree to which the size of the respondent’s enterprise and its access to dedicated human resources specialists affected the process leading up to the applicant’s dismissal (ss 387(f), (g))
[42] The respondent was a not for profit employment services provider with 38 employees at the time the applicant was dismissed. It did not have access to internal human resources specialists, but did engage Mr O’Neill for the purposes of the investigation.
Other relevant matters (s 387(h))
[43] In my view, it is relevant that the Board amended its grievance procedures and resolved to become more involved in the recruitment of employees in response to the circumstances leading up to the applicant’s dismissal. This would corroborate the applicant’s claim that the processes for handling her dismissal were inadequate and unfair.
[44] Given these findings, it is clear that the applicant’s dismissal was both procedurally and substantively unfair. Having considered the matters outlined above, I find that the dismissal of the applicant was ‘harsh, unjust and unreasonable’, within the meaning of s 387 of the Act.
REMEDY
[45] I turn now to the provisions of ss 390-392 of the Act, which are as follows:
390 When the FWC may order remedy for unfair dismissal
(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of compensation to a person, if:
(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) The FWC may make the order only if the person has made an application under section 394.
(3) The FWC must not order the payment of compensation to the person unless:
(a) the FWC is satisfied that reinstatement of the person is inappropriate; and
(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.
391 Remedy—reinstatement etc.
Reinstatement
(1) An order for a person’s reinstatement must be an order that the person’s employer at the time of the dismissal reinstate the person by:
(a) reappointing the person to the position in which the person was employed immediately before the dismissal; or
(b) appointing the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.
(1A) If:
(a) the position in which the person was employed immediately before the dismissal is no longer a position with the person’s employer at the time of the dismissal; and
(b) that position, or an equivalent position, is a position with an associated entity of the employer;
the order under subsection (1) may be an order to the associated entity to:
(c) appoint the person to the position in which the person was employed immediately before the dismissal; or
(d) appoint the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.
Order to maintain continuity
(2) If the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC considers appropriate to maintain the following:
(a) the continuity of the person’s employment;
(b) the period of the person’s continuous service with the employer, or (if subsection (1A) applies) the associated entity.
Order to restore lost pay
(3) If the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC considers appropriate to cause the employer to pay to the person an amount for the remuneration lost, or likely to have been lost, by the person because of the dismissal.
(4) In determining an amount for the purposes of an order under subsection (3), the FWC must take into account:
(a) 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 reinstatement; and
(b) the amount of any remuneration reasonably likely to be so earned by the person during the period between the making of the order for reinstatement and the actual reinstatement.
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.
[46] Ms Gibbons initially sought reinstatement of the applicant to her employment with the respondent (which is in liquidation) in order to assist her in access to the FEG. However, as noted above, Ms Gibbons acknowledged that the Commission does not have power to ‘nominally’ reinstate the applicant in the manner sought; See: Blackadder. In short, the Commission is unable to reinstate the applicant to a position which no longer exists in a company in liquidation. The applicant’s counsel made clear that access to the FEG was the primary purpose of making this application. It was said that a finding of unfairness by the Commission would assist in this respect, although I make no comment on this submission; suffice to note that I have made findings that the applicant’s dismissal was unfair. For the avoidance of doubt, I find that it would be inappropriate to reinstate the applicant (s 390(3)(a)).
[47] This leaves open the question as to whether the Commission should issue an order for compensation. The Order of the Supreme Court makes clear that the applicant is restrained from enforcing any ‘judgment or award against the assets of the Company without further leave of the Court’. I am satisfied that an order of compensation is an ‘award against the assets of the Company’ and, accordingly, its enforcement will require the applicant to apply for further leave of the Court. However, my understanding of the Order, while the applicant is restrained from enforcing such an order (unless leave of the Court is granted), the Commission is not restrained or prohibited from making an order as to compensation.
[48] The applicant’s Counsel did not directly address the Commission as to the quantum of compensation to be awarded in accordance with s 392 of the Act. In its letter to the Commission, BRI Ferrier indicated that it anticipated that any order made by the Commission as to compensation, would be subject to the usual priorities under the Corporations Act. There is no evidence of the amount of, or availability of funds, arising from the respondent’s liquidation. That said, I have no reason to doubt BRI Ferrier’s view that funds are likely to be limited.
[49] While I consider it likely that any order for compensation made by the Commission would be of limited utility, the applicant did not make full submissions as to remedy. Of course, my earlier findings of unfairness may well be sufficient for the applicant’s purposes. However, should the applicant wish to provide further submissions on this matter, she should advise the Commission by no later than close of business, Friday 27 November 2015. If the applicant advises that she wishes to make further submissions on remedy, with particular reference to s 392 of the Act, I will issue directions for the filing of submissions on this discrete matter. If no such advice is received by this date, I will form the view that it is not appropriate for the Commission to make an order for compensation (s 390(3)(b)) and the file will be closed, with no orders made.
DEPUTY PRESIDENT
Appearances:
Ms A Gibbons of Counsel for the applicant.
No appearance for the respondent.
Hearing details:
2015
Sydney:
11 September
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