Joseph Daniel Gorman v Equipment Specialists Australia Pty Ltd
[2023] FWC 1806
•24 JULY 2023
| [2023] FWC 1806 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Joseph Daniel Gorman
v
Equipment Specialists Australia Pty Ltd
(U2023/1941)
| COMMISSIONER SIMPSON | BRISBANE, 24 JULY 2023 |
Application for an unfair dismissal remedy
On 10 March 2023, Mr Joseph Daniel Gorman (Mr Gorman /the Applicant) applied to the Fair Work Commission (the Commission) under s.394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy, alleging he was unfairly dismissed from his employment with Equipment Specialists Australia Pty Ltd (the Respondent).
I listed the matter for an initial directions hearing by telephone on 30 May 2023. The matter was listed for Hearing of the jurisdictional issue and merits of the application by phone on 20 June 2023.
At the commencement of the hearing, the parties agreed for the matter to be conducted as a Determinative Conference. Mr Gorman appeared on his own behalf, and Mr Lawrence Perkins, Operations Manager, appeared for the Respondent.
Mr Gorman submitted witness statements from Rachel Bridges and James Balmain. The Respondent submitted statements from Michele Bowers and Will Dolan. At the commencement of the hearing, Mr Perkins said he did not wish to call Ms Bowers or Mr Dolan and on that basis the Commission has no sworn evidence from those persons. I asked Mr Perkins if he disputed anything in the statements provided by the Applicant, and Mr Perkins stated that he had not read the statements. I offered for the hearing to be adjourned for a short amount of time to allow Mr Perkins to read those statements, however he wished to proceed and didn’t wish to cross examine either of the witnesses who provided those statements. Accordingly, the statement of Ms Bridges and Mr Balmain were admitted uncontested.
Jurisdictional Objection
The Respondent raised a jurisdictional objection that the employer was a small business and the Applicant didn’t meet the minimum employment period. The Applicant was employed with the Respondent from 21 March 2022 until either 2 or 3 March 2023, a period of less than 12 months.
Section 23 of the Act states that a small business employer is one that employs fewer than 15 employees, and that for the purpose of calculating the number of employees, associated entities are taken to be one entity.[1]
The Respondent submitted that the employee numbers for its business entities ranged between 14 to 18, and fluctuated like it does for any business. As at the date of termination, the Respondent submitted its overall employee numbers were just above 15. For the business that Mr Gorman was employed through however, there were less than 8 employees.
The Respondent did not lead any evidence regarding associated entities or employee numbers. In the hearing, I asked Mr Perkins about the other entities. Mr Perkins accepted that there was a degree of connection between the Respondent’s business and the companies that it owns. Mr Perkins agreed that, as a director of the Respondent and the related companies, he has control over all the entities. The statement of Mr Balmain supports the conclusion that the other entities referred to in that statement are associated entities of the Respondent.
On that basis, I concluded that, considering the employer’s associated entities, the Respondent had 15 or more employees at the time of the Applicant’s dismissal, and was therefore not a small business employer. Accordingly, the Applicant satisfied the minimum employment period of six months and I dismissed the Respondent’s jurisdictional objection.
SUBMISSIONS AND EVIDENCE
Ms Bridges gave evidence that she worked for the Respondent between June 2022 and March 2023, and she became the Office Manager in that time. Ms Bridges said that the Applicant was bullied by Ms Bowers on several occasions. Ms Bridges said he had numerous conversations with Ms Perkins regarding this any they were both aware that things needed to change as Ms Bowers attitude was one of the worst she had seen. Ms Bridges said Mr Perkins had also witnessed this. Ms Bridges said Mrs Perkins agreed that Ms Bowers attitude was terrible, and customers had complained. Ms Bridges said that the Applicant had been treated unfairly. Ms Bridges also gave evidence that she resigned after an incident involving Mr Perkins involving an alleged sexual assault.
Mr Balmain was employed as a Workshop Manager for an associated entity of the Respondent and described the Applicant as a friendly and willing person who was willing to help with whatever job was required to be done. Mr Balmain said the Applicant’s role as on road salesperson meant he was not in the office for any length of time. Mr Balmain explained that a change of location in the business led to changed expectations and sales staff were required to assist with de-containerization of imported machinery and to assist with the delivery to customers of machinery, as necessary. Sales staff were also expected to assist mechanics with assembly works on machines, meaning salespersons spent more time in the workshop area.
Mr Balmain said these changes were not backed up with suitable planning or documentation of what was expected or what processes were to be followed. Mr Balmain said similarly office staff were moved around. Mr Balmain said staff worked together however there were some heated discussions as the sales staff were not trained or suitably supported, however they were worked through. Mr Balmain said the office work did not evolve the same way as no flow or process was implemented for the salespeople to follow, with office staff left unsure of what or who to go to for the correct operations. Mr Balmain said Ms Bowers would come into his office and start breaking down as she was not sure what or how to do her job and what she needed to communicate to the sales staff or the mechanic. Mr Balmain said Ms Bowers would have conflicting information given to her by Mr and Mrs Perkins, and she would also believe she had authority over sales staff to direct them. Mr Balmain said her approach was abrasive and would quite often put her offside with those she had to work with.
Mr Balmain said as the situation became more stressful for all involved, Ms Bowers became quite abrupt and almost aggressive in her approach to other staff and interactions became quite difficult. Mr Balmain said he passed these observations to Mr and Mrs Perkins on many occasions verbally, and they would respond by saying they knew and would see what they could do about it.
The Respondent submitted that a valid reason for the Applicant’s dismissal was his conduct and behaviour towards other employees. Mr Perkins gave evidence that the Applicant used inflammatory and abusive language directed at other employees, such as “let’s take this outside”. Mr Perkins also stated that the Applicant had difficulty controlling his temper in the workplace, would attempt to discredit other employees, and would refuse to undertake tasks assigned to him, such as completing logbooks and timesheets. Mr Perkins provided evidence of a specific occasion in which the Applicant refused to accompany a delegate of a factory with whom the Respondent has dealings on a visit to a customer. He submitted that the Applicant refused because of concerns the Applicant had with the repairs that had been made on a vehicle that was to be provided to the customer.
It was submitted by Mr Perkins that the Applicant refused to perform work in relation to the sales of a particular type of vehicle, referred to as a ‘Foton Truck’. Mr Perkins stated that a customer attended the Respondent’s business to enquire about a Foton Truck and was met by the Applicant, who informed the customer that he had no knowledge of Foton Trucks and invited the customer to visit a competitor. Mr Perkins that the Applicant’s conduct and attitude in this situation caused a detriment to the Respondent’s business interests. Due to what he regarded as the Applicant’s ongoing and worsening behavioural issues, Mr Perkins stated that he made the decision to dismiss the Applicant on Thursday, 2 March 2023.
The Applicant submitted that there was no valid reason for his dismissal, which he argues was an impulsive and disproportionate reaction by the Respondent, based on disagreements between the Applicant and other employees. Mr Gorman stated that he was dismissed while on sick leave taken due to stress caused by the Respondent, and his dismissal was the direct result of him raising workplace concerns with the Respondent. He argued that he carried out his role to a high standard, and the Respondent had not raised any performance concerns with him.
The Respondent submitted that Mr Perkins informed the Applicant of his dismissal by telephone on the afternoon of Thursday, 2 March 2023. The Applicant was then issued a termination letter on 3 March 2023, which Mr Perkins states confirmed the dismissal that took effect the previous day via telephone. Mr Perkins stated he informed the Applicant that his dismissal was effective immediately, and that he was to return his work vehicle to the Respondent by close of business on Friday, 3 March 2023. The Applicant contended that he was not informed of his termination during the telephone call of 2 March 2023, and that termination did not occur until he received his termination letter the following day.
Mr Perkins stated that during the telephone call, he advised the Applicant that he was being dismissed due to his conduct in relation to his refusal to carry out tasks and his personality conflicts with, and behaviour towards other employees. In response, the Applicant stated that he was not provided with any reasons for a dismissal during the phone call on 2 March 2023 and was instead invited by Mr Perkins to raise any concerns he may have in an email.
The Applicant submitted he was on personal leave at the time of the dismissal and had a doctors certificate to support that. The Applicant said that he was not in the State and was in New South Wales working on 2 March. The Applicant accepted a conversation did occur on 2 March 2023 with Mr Perkins during which the Applicant claims that he was told if he had a complaint, he should submit it in writing which the Applicant said he did in the email he sent about at 10.15pm on that night which was provided as part of his case. The Applicant said that Mr Perkins must have given the email to his wife Mrs Perkins the Office Manager, and he received a phone call from Mrs Perkins on the Friday morning 3 March asking him to come and in for a discussion about the issues he had raised and the Applicant said by that stage he had already submitted a Doctors certificate for 3 March 2023. The Applicant claimed that it was later that day in the afternoon of Friday, 3 March when the Applicant was dismissed by receiving the termination letter. The Applicant submitted that he believed that Respondent had realised that it had dismissed him while he was on sick leave, and that the Respondent then decided to claim retrospectively that he had been dismissed in the phone call the previous day when he had not been.
Mr Perkins said that the Applicant rang him on the Thursday afternoon and Mr Perkins said he was in Chinchilla. Mr Perkins said the Applicant wanted to argue and argue, and complain about others, and he wanted Mr Perkins to remove Ms Bowers from employment. Mr Perkins said the Applicant continued to argue, and Mr Perkins claimed he said to the Applicant if he wanted to keep arguing, he would have to terminate the Applicant. Mr Perkins said he was away and could not protect other employees, and he remembered the Applicant had said in the past ‘let’s take it outside’. Mr Perkins said he made the decision to terminate the Applicant. Mr Perkins said the Applicant wanted to continue arguing and he told the Applicant to calm down, and when he didn’t, he told the Applicant his employment was terminated immediately and to return all the Respondent’s property the following day. The Applicant said he initiated the phone call and he rang Mr Perkins to speak about a particular issue. The Applicant said Ms Bowers had ‘stitched him up pretty badly’ in relation to a particular customer, and he decided there was no point talking to Ms Bowers about it, and so he rang Mr Perkins on the Thursday afternoon and Mr Perkins told him to put it all in writing. Mr Perkins agreed that the Applicant rang him complaining about Ms Bowers, and agreed that he said to the Applicant to put it in an email, however his version of the discussion is that it ended by Mr Perkins telling the Applicant his employment was being terminated and to return the vehicle the following afternoon. Mr Perkins accepted that he received the Applicant’s email however maintained that the Applicant was already dismissed.
Mr Perkins claimed he rang his wife and told her straight away after the conversation with the Applicant, and the termination letter was prepared that night. Mr Perkins said the vehicle was not returned on the Friday, and the Applicant used keys to enter the premises and the building on the weekend and the Respondent provided photos claiming the Applicant left an ice cream wrapper on Ms Bowers desk, and did a ‘doughnut’ with his vehicle in the yard of the Respondent’s premises. The Applicant said there is no proof he did the doughnut in the yard, and the property on which the Respondent’s business is based is shared with the businesses so it could have been anyone who did the doughnut in the yard. He agreed he returned the vehicle on the Sunday after his dismissal. The Applicant denied leaving any food wrappers on the desk of Ms Bowers. Mr Balmain gave evidence that the business compound has two other businesses that are renting space and sharing a common area and have access to the site at any time, one of which has a few young people working for it in an industrial capacity and he has witnessed these young people being silly with the operation of their vehicles when leaving work and it is a loose accusation that the Applicant was the culprit for marks on the ground. Mr Perkins said he has also had lolly wrappers left on his desk and Ms Perkins has often had her children in the workplace when working after hours.
The Applicant said the termination was a direct result of his raising concerns with the Respondent about the workplace problem with Ms Bowers. The Applicant said he received no warning before he received the termination letter. The Applicant said he had never received any information that he was not performing which is now said in response to his unfair dismissal application. The Applicant claimed that he was trying to bring the issue to a head, and the Respondent decided it was easier to fire him because it then did not have to deal with fixing the problem.
On reading the message sent by the Applicant at 10.15pm on the evening of Thursday 2 March, it does not read as if it was written by someone who believed they had been dismissed from their employment earlier that same day. The email makes a series of complaints and indicates the Applicant does not intend to return to work in the same office as the person to whom the complaints are generally directed until the Respondent addresses the complaints.
Mr Perkins contended that the Applicant was not telling the truth during his evidence. Mr Perkins said that on multiple occasions the Respondent has had issues with the Applicant arguing with other staff. Mr Perkins said the Applicant had a temper issue which was a concern for the business. Mr Perkins could not give any specific dates or times when he said the Applicant had behaved in this way. Mr Perkins said he had not had an employee argue with him in the way the Applicant did. Mr Perkins contended that the Applicant had refused to fill out a logbook for his vehicle and argued about it. The Respondent contended he was asked to fill out paperwork for cost coding and the Applicant refused to do this. Mr Perkins said this had major costs implications for the Respondent including tax issues, and this had financial implications. The Respondent said the Applicant refused to accompany a delegate named David from a factory, to visit a customer Cobbleton Farms.
The Applicant stated that he had in fact agreed to accompany the delegate, but was unable to do so, as he was dismissed before the delegate returned from a tour of New South Wales and Victoria. The Applicant said he was booked in to do it the week after he was dismissed. The Applicant said the person did a tour of New South Wales with a person named Lance who was the sales employee. The Applicant said he would agree it was a legitimate reason to dismiss someone if he had refused to perform a task, however he did not do this. Mr Perkins said the reason the Applicant said he refused to take the delegate to Cobbleton Farms was because the information was in Chinese and the AM/FM radio is not fixed and he refused to go to that customer because the vehicle had not been fixed. The Applicant in response said he was told how to clear the problem the customer was having, and an appointment was arranged for the week after when he was dismissed. Mr Perkins said the termination letter was written with his wife however it was done over the phone as he was in a different location.
Mr Perkins said he had made up some temporary information concerning the Foton Trucks while he was waiting for the more detailed information to be provided to the Respondent. The Applicant contended that in relation to the Foton Truck issue raised by the Respondent, he had received no information from the Respondent in relation to that type of vehicle. He argued that as he was a former truck driver, he would not have refused to perform work on trucks. Given his truck-driving background, the Applicant stated that he wanted to sell trucks, but was not provided with the necessary information and opportunity to enable him to do so. The Applicant also refuted the Respondent’s suggestion that he invited customers to approach competitors on the basis that he is not aware of any other business that sells Foton Trucks in the area. The Applicant said he wanted to sell the trucks and he wasn’t given the opportunity.
Mr Perkins said the Applicant was also wasting time looking into what other staff were doing, and complaining that other sales people were working in his area. The Applicant said his role was an out of office role and he travelled great distances to promote the brand. The Applicant said his dealing with Ms Bowers was quite limited anyway, however he said to Mr Perkins that Ms Bowers obviously had problems with him, and he said to Mr Perkins if he could avoid dealing with her he would.
The Respondent accepted that the decision to dismiss the Applicant was made summarily, and in that sense, the Applicant was not provided with an opportunity to respond. The Applicant, while refuting that the dismissal occurred during the telephone call, agreed that he was not provided with an opportunity to respond to the reasons for his dismissal, but stated that he provided the Respondent an opportunity to retract its termination letter.
Mr Perkins gave evidence that he and Ms Perkins, issued several verbal warnings to the Applicant regarding his behaviour. He stated that these warning were issued in the Respondent’s office. Mr Perkins also described an instance whereby the Applicant and Ms Bowers were both informed that they were at risk of being dismissed if they were unable to resolve conflicts between themselves.
The Applicant submitted that he did not receive any verbal or written warnings prior to his dismissal. The Applicant said if the Applicant went into such a long winded explanation in a phone call that Mr Perkins claimed he did, the Applicant must be much more patient then Mr Perkins claimed, and he reiterated his claim that he was told to put the issues in an email. The Applicant said he did prepare a response to the termination letter but decided not to submit it as part of his evidence. The Applicant said at the time he would have been prepared to resign on the basis of being paid notice and his legal entitlements. The Applicant said he has never been terminated in his life.
Mr Perkins claimed the Applicant had been given a verbal warning in the workshop office and the Applicant denied this ever occurred.
Consideration
(a) Whether there was a valid reason for dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees);
A valid reason was described in Selvachandran v Petron Plastics Pty Ltd[2] as one which is “…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 reason must be valid in the context of the employee’s capacity or conduct or based on the operational requirements of the employer’s business.”
I have considered the completing claims concerning whether the Applicant was dismissed in the course of a telephone call on the afternoon of Thursday 2 March, or by letter the following day. Ultimately this is a case where there are only two witnesses to the telephone conversation who were the two participants however there are no other witness to corroborate either version. Mrs Perkins could have been called to give evidence to corroborate Mr Perkins claim that the termination letter was prepared to confirm what he had said to Mrs Perkins was the version of the conversation. Mrs Perkins also could have given evidence about alleged conduct of the Applicant. The Respondent chose not to so do. The Commissions task is to draw a conclusion based on the evidence before it, on the balance of probability, by determining which version is more likely to be true on the state of the evidence. Whilst some doubt exists, I am inclined to prefer the Applicant’s version that a termination was not communicated during the phone call on 2 March, and instead the Applicant was told to put his complaints in writing. I have reached this conclusion because the email sent at 10.15pm on the evening after the conversation is a contemporaneous document, written within hours of the telephone call and it does not read as if the Applicant had been told his employment had been terminated, and instead tends to be more consistent with the Applicant’s version that the conversation ended with the Applicant being told to put his compliant in writing.
Having reached that conclusion as more likely to be accurate, then it follows that I must accept that the Applicant was terminated the following day on 3 March, after having provided a medical certificate, and without the employer addressing the issues that it had told the Applicant to put into writing. In the circumstances the Respondent did not have a valid reason for termination at the time of the termination as it did not have a proper basis to reach conclusions in relation to the issues contained in the email sent to it at 10.15pm the previous evening without a proper investigation of those issues. Further, the limited evidence before the Commission tends to support the likelihood that there was some legitimacy to the Applicant’s complaints about Ms Bowers conduct toward him.
Mr Perkins made generalised allegations about the conduct and behaviour of the Applicant towards other employees, and his use of inflammatory and abusive language and difficulty controlling his temper. However, this was not supported with specific examples or accounts of specific instances that could be properly interrogated. Mr Perkins gave evidence that the Applicant refused to undertake tasks assigned to him such as completing logbooks and timesheets. The Applicant denied any issues were ever raised with him about these issues or anything in relation to his conduct or performance. There is no evidence to support the Respondent’s allegations besides the assertions themselves. Mr Perkins provided evidence of a specific occasion in which he said the Applicant refused to accompany a delegate of a factory to visit to a customer however the Applicant responded that he didn’t refuse, and an appointment had been made to assist this person however he was terminated before this could occur.
The evidence concerning the allegation that the Applicant refused to perform work in connection with the Foton Trucks is contested, and I am not satisfied on the evidence put before the Commission that the Applicant refused a lawful and reasonable direction as claimed. He provided a plausible explanation concerning the difficulties encountered with this new product. I am also not inclined to accept that he directed a potential customer to a competitor.
Having considered the evidence, I am not satisfied the Respondent had a valid reason for dismissal at the time of termination.
(b) Whether the person was notified of the reason
On the basis of my finding above it follows that the Applicant was not notified of the reasons for his dismissal until receiving the termination letter on 3 March 2023.
(c) Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person
The Respondent accepted that the termination was a summary dismissal. The Applicant was not given an opportunity to respond to the reasons for his termination related to his capacity or conduct before his termination.
(d) Any unreasonable refusal by the employer to allow the person to have a support person present to assist in any discussions relating to dismissal
This consideration will only be relevant where an employee seeks to have a support person present to assist in discussions in relation to dismissal and the employer refuses. The evidence does not establish that the Applicant requested a support person for the meetings in August where the termination was discussed. This is therefore a neutral consideration.
(e) Was the Applicant warned about unsatisfactory performance before dismissal
Mr Perkins said Mrs Perkins had warned the Applicant however Mrs Perkins did not give evidence. The Applicant strongly refutes the suggestion he received any warnings at all. Mr Perkins said he had given the Applicant warnings, however I am not satisfied that whatever may have been said that the Applicant had been told his employment was in jeopardy if his performance did not improve, prior to his termination of employment.
(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
The employer is not a small business, however it appears from the evidence is not much larger than a small business, which is likely to impact on the procedures it followed in effecting the dismissal.
(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
The Respondent does not have any internal human resources expertise which is likely to impact on the procedures it followed in effecting the dismissal.
(h) Any other matters that the FWC considers relevant
The Applicant was summarily dismissed. His termination resulted in the immediate loss of the vehicle. He is a father of two children and this would have created difficulties for him. The employment was of fairly short duration at less than 12 months. He was able to obtain other employment within three weeks. The Respondent has put come limited evidence on concerning alleged conduct on the part of the Applicant post termination. I have considered the evidence on these matters and whilst it may be possible that the Applicant performed a ‘doughnut’ on the Respondent’s premises, and left some litter in the office, I am not prepared to find that it is probable that the Applicant did either of those things and therefore do not intend to afford it any weight in reaching a conclusion.
HARSH, UNJUST OR UNREASONABLE
I have concluded that the Respondent did not have a valid reason for termination at the time of termination, and the dismissal was procedurally unfair. I am satisfied that the dismissal was harsh, and unreasonable.
REMEDY
The Applicant said he did not seek reinstatement. The Applicant said he had another job, and he is quite happy with it. The Applicant said he commenced new employment three weeks after his termination. The Applicant said the income in the new job is $65,000 compared to $75,000 annually in his employment with the Respondent. The Applicant said he applied for other jobs on Seek and online. The Respondent said the Applicant claimed to have been on sick leave so he wouldn’t have been able to start another job immediately anyway. The Respondent said in its Form F3 Respondent that on 28 March 2023 it paid one weeks’ notice to the Applicant minus the cost of a new mobile handset as the work phone was returned locked, and also less a work shirt not returned.
It is apparent from the evidence that the employment relationship was reasonably short, neither the Applicant or the Respondent were happy with the state of the employment relationship, and it was under considerable strain. I am not satisfied that the employment relationship was likely to last more than another four weeks. The Applicant was paid an annual salary of $75,000. $75,000 divided by 52 weeks equals $1,442.30 gross which would be the equivalent of one week’s pay. $1,442.30 multiplied by four equals $5,769.23. The Applicant said he gained other employment within three weeks, however at a lower rate of pay as he said he was earning an annual salary in his new employment of $65,000 per year. A week’s wages in the new role is therefore $1,250 gross.
In accordance with the decision in Sprigg v Paul Licensed Festival Supermarket (1998) 88 IR 21 the Commission would ordinarily deduct from an order for compensation the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making the order for compensation. I intend to deduct the figure of $1,250 from the figure of $5,769.23 on account of the income earned in the new employment that falls within the estimated period of continued employment but for the dismissal, resulting in a figure of $4,519.23.
I am satisfied that the Applicant made efforts to mitigate his loss, and there are no other matters in section 392(2) that would cause me to further reduce the amount of compensation ordered. I am cognisant that the Respondent said that it did pay one week of notice in late March 2028 however deducted from that figure the cost of a new mobile handset and work shirt. The specific costings of these items were not put into evidence, or the sum paid in late March 2023. I do not intend to make any further deductions to the amount of compensation assessed on that basis.
I have determined that the Respondent should pay to the Applicant within 14 days of the date of this decision, the sum of $4,519.23 gross taxed according to law and 10.5% superannuation contribution on that amount into Mr Gorman’s nominated superannuation fund. An order to this effect will be issued separately and concurrently with this decision.
COMMISSIONER
Appearances:
Mr Joseph Gorman on his own behalf.
Mr Lawrence Perkins for the Respondent.
Hearing details:
2023
By Telephone.
20 June
[1] Fair Work Act 2009 (Cth) s 23.
[2] (1995) 62 IR 371 at 373.
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