Kirsten Suttie v Lloyd and Co Pty Ltd T/A Lloyd and Co
[2015] FWC 4242
•14 JULY 2015
| [2015] FWC 4242 [Note: An appeal pursuant to s.604 (C2015/5020) was lodged against this decision - refer to Full Bench decision dated 11 November 2015 [[2015] FWCFB 7513] and 4 February 2016 [[2016] FWCFB 144]] respectively for result of appeals.] |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Kirsten Suttie
v
Lloyd & Co Pty Ltd T/A Lloyd & Co
(U2014/15392)
COMMISSIONER RYAN | MELBOURNE, 14 JULY 2015 |
Application for relief from unfair dismissal - jurisdiction - Small Business Fair Dismissal Code.
[1] This decision arises from an application by Ms Suttie for an unfair dismissal remedy pursuant to section 394(1) of the Fair Work Act 2009 (the Act) in relation to the termination of her employment by Lloyd & Co Pty Ltd (the Respondent).
[2] The Applicant commenced employment with the Respondent in November 2005. Some time after commencing employment the Applicant became a 20% shareholder in the Respondent. The other 80% shareholding was held by Mr Shaun Lloyd. The Applicant’s employment with the Respondent was terminated by Mr Shaun Lloyd on 3 November 2014. The Applicant filed an unfair dismissal application on 24 November 2014.
[3] The Respondent filed a Form F3 – Employer Response on 8 December 2014. Form F3 invites an employer to identify any jurisdictional objections the employer may have to the application. Section 2 of the Form F3 identifies 7 specific jurisdictional objections and 1 general jurisdictional objection and invites the employer to identify as many jurisdictional objections as are relevant. Two of the specific possible jurisdictional objections are:
● The Applicant earned more than the high income threshold
● The business is a small business, and the dismissal was consistent with the Small Business Fair Dismissal Code.
[4] In completing the Form F3 the Respondent only identified that it had a jurisdictional objection to the application on the basis that the applicant earned more than the high income threshold. This objection was dealt with by Blair C at a hearing held on 27 February 2015 in which he dismissed the jurisdictional objection of the Respondent and directed that the matter be programmed for conciliation. Directions were issued on 10 April which both set the time for a conciliation and a time for an Arbitration with Directions in relation to the Arbitration. The conciliation was listed for 21 April 2015, the Applicant was required to file and serve her material by noon 27 April 2015, the Respondent was required to file its material by noon 18 May 2015 and the arbitration was listed for 1st, 2nd and 3rd June 2015. The notice of listing was subsequently amended but the directions were not.
[5] The Applicant complied with the Commission’s directions on 24 April 2015.
[6] The conciliation took place on 1 May 2015 and there was no resolution.
[7] On 11 May the Respondent’s lawyers sought an Order to Produce to be issued by the Commission against the Applicant relating to monies earnt by the Applicant since her dismissal by the Respondent. The Order to Produce was to be complied with by 22 May 2015.
[8] The Respondent filed its material pursuant to directions on 18 May 2015. The Outline of Submissions of the Respondent filed with the Commission on 18 May 2015 specifically raised a further jurisdictional issue, namely that the dismissal was consistent with the Small Business Fair Dismissal Code.
[9] On 25 May 2015 the Respondent filed a Form F4 – Objection to Application for Unfair Dismissal Remedy in which the Respondent formalised its objection that the dismissal was consistent with the Small Business Fair Dismissal Code (the Code). Whilst the matter had been listed for arbitration of the unfair dismissal application the hearing was limited to dealing with the new jurisdictional objection raised by the Respondent.
The Small Business Fair Dismissal Code
[10] The Small Business Fair Dismissal Code states:
“Summary dismissal
It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee's conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.
Other dismissal
In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee's conduct or capacity to do the job.
The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.
The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee's response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer's job expectations.
Procedural matters
In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.
A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements”.
Contention of the Respondent
[11] The Respondent contended that “the Applicant relatedly undermined the authority of Mr Shaun Lloyd, both directly in communications with him, and surreptitiously to other staff and clients in his absence”. 1 The Respondent contended that this conduct was serious misconduct and justified summary dismissal in accordance with the first part of the Code.
[12] The Respondent also contended that the dismissal was consistent with the second part of the Code, “as Mr Lloyd had on numerous occasions raised concerns with the Applicant about her performance and conduct (both in discussions with her and via email), including raising the prospect that her employment would be terminated if her behaviour did not change.” 2
Consideration
[13] The purpose behind the existence of the Small Business Fair Dismissal Code is to treat a dismissal as a fair dismissal if the employer acts in a way which is consistent with the Code. In enacting s.388 and 396 of the Act Parliament has clearly given the Minister the ability to create and declare a Code which enables an employer to dismiss an employee in circumstances which would be considered to be unfair if s.387 applied. In fact the Code does just that.
Summary Dismissal of the Applicant
[14] The Code permits an employer to summarily dismiss an employee without objectively establishing that the employee has engaged in conduct which would justify summary dismissal. All that is required under the Code is that the employer subjectively believes that the employee conduct is sufficiently serious to justify immediate dismissal and that such subjective belief is based on reasonable grounds.
[15] In practice this means that a summary dismissal which would abysmally fail an objective test, such as is required under s.387, would be considered to be a fair dismissal if the employer is a small business employer and the employer subjectively believes on reasonable grounds that the employees conduct is sufficiently serious to justify immediate dismissal.
[16] The purpose of the Code is to clearly relieve small business employers of the need to comply with the requirement not to unfairly dismiss an employee within the meaning of s.387 of the Act..
[17] The proper focus, therefore, is to consider whether Mr Shaun Lloyd believed on reasonable grounds that the conduct of the Applicant was sufficiently serious to justify immediate dismissal. There is no requirement (and in fact it is not permitted) for the Commission to be satisfied that the conduct of the Applicant would justify immediate dismissal.
[18] In the present matter the evidence of Mr Shaun Lloyd is that he believed that the Applicant’s conduct was sufficiently serious to justify immediate dismissal. The Applicant challenges the credibility of the Mr Shaun Lloyd’s evidence. For the purpose of considering this limb of the Code I intend to proceed on the basis of accepting that Mr Shaun Lloyd believed that the Applicant’s conduct was sufficiently serious to justify immediate dismissal.
[19] In the present matter there is no doubt that the evidence of the Applicant establishes that the Applicant believed that the Applicant’s conduct didn’t even remotely come near to being conduct which was sufficiently serious to justify immediate dismissal.
[20] Given that both Mr Shaun Lloyd and the Applicant constitute the employer in this matter then it is clear that 80% of the employer (Mr Shaun Lloyd’s shareholding) believed that the Applicant’s conduct was sufficiently serious to justify immediate dismissal and 20% of the employer (the Applicant’s shareholding) held a diametrically opposed view as to the Applicant’s conduct.
[21] In the present matter Mr Shaun Lloyd made a unilateral decision to dismiss the Applicant and thus the decision of Mr Lloyd was implemented as the decision of the Respondent.
[22] The focus in the present matter must therefore be on whether Mr Shaun Lloyd’s belief that the Applicant’s conduct was sufficiently serious to justify immediate dismissal, was a belief held on reasonable grounds.
[23] In Pinawin T/A Rose Vi.Hair.Face.Body v Domingo 3 a Full Bench considered the summary dismissal provisions of the Code as follows:
“[25] There have been few decisions discussing the requirements of the relevant paragraph of the Small Business Fair Dismissal Code in Australia and no Full Bench cases. Commissioner Deegan in French v Lufra Investment expressed her conclusion on consistency with this part of the Small Business Fair Dismissal Code as follows:
‘[41] The respondent appeared to argue that the applicant’s conduct was serious misconduct as it was “wilful and deliberate behaviour by an employee that is inconsistent with the contract of employment”. I am not satisfied that the applicant’s conduct in initially refusing to restore the shed to its former state or refusing to discuss the matter with Ms Holland some short time later was, in all the circumstances “wilful or deliberate behaviour” or in fact conduct so serious as to justify summary dismissal. I will expand on my reasons for reaching this conclusion in dealing with the matter of whether the dismissal was harsh, unjust or unreasonable. As summary dismissal was not warranted in this case the dismissal was inconsistent with the Code.’
[26] In our view this approach is not consistent with the requirements of the Small Business Fair Dismissal Code as it equates the test in the Code with a determination by the tribunal of whether summary dismissal was warranted.
[27] Deputy President Bartel in Narong Khammaneechan v Nanakhon Pty Ltd ATF Nanakhon Trading Trust T/A Banana Tree Cafe said:
‘[60] At the outset it is appropriate to note that unlike a consideration of the dismissal of an employee of a business that is not a small business employer, the function of FWA is not to determine on the evidence whether there was a valid reason for dismissal. That is, the exercise in the present matter does not involve a finding on the evidence as to whether the applicant did or did not steal the money. The application of the Small Business Fair Dismissal Code involves a determination as to whether there were reasonable grounds on which the respondent reached the view that the applicant’s conduct was serious enough to justify immediate dismissal. As such, the determination is to be based on the knowledge available to the employer at the time of the dismissal, and necessarily involves an assessment of the reasonableness of the steps taken by the employer to gather relevant information on which the decision to dismiss was based.’
[28] Senior Deputy President O’Callaghan in Harley v Rosecrest Asset Pty Ltd T/A Can Do International said:
“[8] For an employer to believe on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal, it is firstly necessary for the employer to establish that the employer did in fact hold the belief that as a matter of fact that (i) the conduct was by the employee; (ii) the conduct was serious; and (iii) that the conduct justified immediate dismissal. This is to be contrasted to the provisions of s.387(a) where FWA, in determining whether there was a valid reason for the dismissal, must find whether the conduct in fact occurred.
[9] Secondly, it is necessary for the employer to establish that there are reasonable grounds for the employer holding the belief. It is thus necessary for the employer to establish a basis for the belief held which is reasonable. In this regard it would usually be necessary for the employer to establish what inquires or investigations were made to support a basis for holding the belief. It would also ordinarily be expected that the belief held be put to the employee, even though the grounds for holding it may not be. Failure to make sufficient inquiries or to put the accusation to the employee in many circumstances might lead to a view that there were no reasonable grounds for the belief to be held.”
[29] We believe that the approach and observations in these two decisions are correct. There are two steps in the process of determining whether this aspect of the Small Business Fair Dismissal Code is satisfied. First, there needs to be a consideration whether, at the time of dismissal, the employer held a belief that the employee’s conduct was sufficiently serious to justify immediate dismissal. Secondly it is necessary to consider whether that belief was based on reasonable grounds. The second element incorporates the concept that the employer has carried out a reasonable investigation into the matter. It is not necessary to determine whether the employer was correct in the belief that it held.
[30] Acting reasonably does not require a single course of action. Different employers may approach the matter differently and form different conclusions, perhaps giving more benefit of any doubt, but still be acting reasonably. The legislation requires a consideration of whether the particular employer, in determining its course of action in relation to the employee at the time of dismissal, carried out a reasonable investigation, and reached a reasonable conclusion in all the circumstances. Those circumstances include the experience and resources of the small business employer concerned.”
[citations omitted]
[24] As far as it goes the conclusion drawn by the Full Bench in relation to the second element of the two step process is undoubtedly correct – “The second element incorporates the concept that the employer has carried out a reasonable investigation into the matter.”
[25] However the concept of reasonable grounds includes much more than the concept that the employer has carried out a reasonable investigation into the matter.
[26] In McKinnon v Secretary, Department of Treasury, 4 Gleeson CJ and Kirby J in dissent said:
“9.… statutes which confer a power conditioned upon the existence of reasonable grounds for a state of mind such as suspicion, or belief, are common. Powers of search and seizure, or arrest, are often conditioned in that way. Downes J referred to the decision of this Court in George v Rockett where it was said:
‘When a statute prescribes that there must be 'reasonable grounds' for a state of mind - including suspicion and belief - it requires the existence of facts which are sufficient to induce that state of mind in a reasonable person.’
10. This is an objective test. George v Rockett was concerned with Queensland legislation empowering the issue of a search warrant if there were reasonable grounds for suspecting that there was incriminating evidence in a house. The statutory formula, however, is widely used. The point of the objectivity of such a test, when it is necessary to consider whether a primary decision-maker had reasonable grounds for a given state of mind, is that the question is not whether the primary decision-maker thinks he or she has reasonable grounds.
11. To decide whether it was reasonably open to a decision-maker, on the evidence, to make a judgment such as ………..whether the known facts are sufficient to induce in a reasonable person a suspicion or belief that someone is guilty of a crime ….. involves an evaluation of the known facts, circumstances and considerations which may bear rationally upon the issue in question. A judgment as to whether information or argument bears rationally upon a question is also a familiar exercise. It is usually discussed by courts under the rubric of relevance. If a piece of information, or an opinion, or an argument, can have no rational bearing upon a question for decision, it is irrelevant, and must be left out of further consideration. Otherwise, being relevant, just decision-making requires that it be taken into account.
12. Where a …state of mind (such as suspicion, or belief, or satisfaction) involves an interplay of observation (of objective facts and circumstances), opinion, and judgment (which may involve an evaluation of matters such as reasonableness of conduct, or of the public interest), the question whether there are reasonable grounds for such a ….state of mind requires a consideration of all relevant matters and an assessment of the reasonableness of the …state of mind having regard to all relevant considerations. Suppose the question is whether there are reasonable grounds for suspecting that A killed B. Suppose that A is a person of violent propensity, who had a motive to kill B, and had declared an intention to do so. Let it be assumed that those three facts are incontestable. In the absence of any other facts they may lead to a conclusion that there are reasonable grounds for suspecting that A killed B. Suppose, however, that A has an undisputed alibi. The first three facts then cease to constitute reasonable grounds for the suspicion. The question cannot be answered without considering all four facts. It is not a hypothetical question. It is a question to be answered in the light of all the known circumstances.”
In the same matter, Hayne J, as part of the majority, said:
“59. The appellant sought support for the first step in these submissions from what was said by this Court in George v Rockett. But that case concerned a very different legislative provision which governed a Justice's issuing of a warrant where there were "reasonable grounds for suspecting" certain matters. In that context, the references to inducing a particular state of mind are apposite. But the question presented by s 58(5) makes no reference to the state of mind of any person. It asks whether there exist reasonable grounds for a claim that has been made. And it may seriously be doubted that the understanding of the Tribunal's task is assisted by injecting notions of persuasion or satisfaction of the kind with which George v Rockett was concerned. Such notions are unhelpful in this context because they all too readily may be understood as requiring the Tribunal to make its own assessment of where the public interest lies. That is not what s 58(5) permits or requires. It requires an assessment of the grounds for the conclusion that disclosure is not in the public interest. Do reasonable grounds exist for that conclusion?
[27] As the plain language of the Code makes clear, and as correctly described by the Full Bench in Pinawan, it is necessary to consider whether the employer’s belief was based on reasonable grounds. The decision of the High Court in George v Rockett is directly on point in establishing the reasonable grounds.
[28] Thus whether Mr Shaun Lloyd held his beliefs on reasonable grounds requires “the existence of facts which are sufficient to induce that state of mind in a reasonable person”. Determining whether such facts exist requires the Commission to not only consider the concept that the employer has carried out a reasonable investigation into the matter, but also to apply an objective test in relation to the reasonable grounds. “The point of the objectivity of such a test, when it is necessary to consider whether a primary decision-maker had reasonable grounds for a given state of mind, is that the question is not whether the primary decision-maker thinks he or she has reasonable grounds.” 5
[29] In all of the circumstances of this case it is absolutely clear that Mr Shaun Lloyd had no reasonable grounds for believing that the Applicant’s conduct was sufficiently serious to justify immediate dismissal.
[30] The elephant in the room, which the Respondent’s case on summary dismissal clearly treated as not being there, was the fact that not only was the Applicant an employee of the Respondent she was also a 20% shareholder in the Respondent and had become a 20% shareholder in the Respondent by agreement with Mr Shaun Lloyd (previously the 100% owner of the Respondent) and with the intention of eventually buying out Mr Shaun Lloyd’s 80% remaining stake in the Respondent. The elephant in the room is an elephant of considerable size and value. After the Applicant was dismissed the Applicant commenced separate proceedings in the Supreme Court against Mr Shaun Lloyd for oppressive behaviour against the Applicant as a minority shareholder. Recently the Applicant sold her 20% interest in the Respondent for $200,000 6 to two other employees of the Respondent.
[31] Apart from the elephant in the room it also appears that the room was lined with magic mirrors which only reflected an image of Mr Shaun Lloyd which he had created for and of himself.
[32] It is clear that Mr Shaun Lloyd considered Lloyd and Co Pty Ltd to be his personal fiefdom in which he could employ family members as he saw fit regardless of their cost to the business or their benefit to the business. This was best epitomised by the fact that Mr Shaun Lloyd engaged his parents not as employees but as independent contractors to do filing work for the Respondent and for which they were paid a consultancy fee. 7 The view expressed by the Applicant that, but for the necessary presence of Mr Shaun Lloyd, the Applicant preferred a “Lloyd free zone” at the Respondent was clearly not going to endear her to Mr Shaun Lloyd. Whilst the Applicant considered that some members of the Lloyd family were not adding value to the business of the Respondent and whilst such a view was a reasonable view for a part owner of the Respondent to hold, it jarred with Mr Shaun Lloyd’s view.
[33] The elephant in the room directly impacts on whether Mr Shaun Lloyd’s belief that the Applicant’s conduct was sufficiently serious to justify immediate dismissal was based on reasonable grounds.
[34] The inquiries made by Mr Shaun Lloyd into the conduct of the Applicant is insufficient to satisfy the “on reasonable grounds” test.
[35] The Respondent relied on the Full Bench decision in Steri-Flow Filtration Systems (Aust) P/L v Erskine 8 and on the case cited therein of Concut P/L v Worrell.9 I accept the correctness of both decisions and apply them to the current matter. The key differentiating factor in the present matter is that for the Applicant to act in a manner which was incompatible with a continuation of the employment relationship and which justified summary dismissal requires the Applicant to act against her own interests as a 20% part owner of the respondent. The evidence of the Applicant which is unchallenged is that the Applicant was the highest income generator for the Respondent. The conduct of the Applicant as established by the evidence was to support and grow the business.
[36] The Applicant was not an employee of Mr Shaun Lloyd but an employee of the Respondent and the Applicant’s conduct was not conduct which was incompatible with the Applicant’s duties and obligations towards the Respondent, nor was the Applicant’s conduct incompatible with the continuation of the employment relationship existing between the Applicant and the Respondent.
[37] There was no reasonable grounds for Mr Shaun Lloyd holding the belief that the conduct of the Applicant justified immediate dismissal.
Other Dismissal of the Applicant
[38] The Respondent contends that if the dismissal of the Applicant was not consistent with the Summary Dismissal part of the Code the dismissal of the Applicant was nevertheless consistent with “Other Dismissal” part of the Code.
[39] The Respondent correctly identifies the requirements for a dismissal to be compliant with the “Other Dismissal” part of the Code.
“The first is that the employer must give a reason why the employee’s employment is at risk of being dismissed. Second, that reason must be valid, with respect to the conduct involved. Thirdly, the employee must have been warned either verbally or in writing, that they risk being dismissed if there’s no improvement and for a conduct case, that’s for the conduct to stop. And an opportunity to respond/chance to rectify, ie, that’s just time.
And then there needs to be evidence of compliance with the Code and if one wonders why that’s in there, because one of the ways you can do that is providing witness statements in the Commission which we’ve done.” 10
[40] The Respondent contends that each of the elements necessary to establish that the dismissal is consistent with the “Other Dismissal” provisions of the Code have been established by the evidence of Mr Shaun Lloyd.
[41] The Applicant’s evidence is that some of the events as recounted by Mr Shaun Lloyd simply did not occur and that at no time had the Applicant received a warning that she was at risk of being dismissed.
[42] The evidence of Mr Shaun Lloyd was that the Applicant was verbally warned that she was at risk of being dismissed. No written warnings were given to the Applicant.
[43] Mr Shaun Lloyd’s evidence was that he made contemporaneous notes of conversations and interactions between himself and the Applicant and that these contemporaneous notes record that the Applicant was clearly verbally warned that she would be terminated if her conduct did not change.
[44] Mr Follett, counsel for the Respondent, succinctly put the Respondent’s position as follows:
“If Commissioner – we say this, if you accept that what Mr Lloyd has recorded in those documents, which on his sworn evidence were created contemporaneously with the incident in question and which read as if they were created contemporaneously - because many of them reflect Mr Lloyd talking to himself and making contemporaneous observations about the state of affairs - if you accept that that those conversations occurred the way Mr Lloyd says they did, they’re warnings.” 11
[45] In the context of the specific denials of the Applicant that she was so warned I am not satisfied that the Applicant was warned that she was at risk of being dismissed.
[46] Given that the Applicant was both an employee of the Respondent and a part owner of the Respondent it beggars belief that Mr Shaun Lloyd would not have put in writing the warnings which he says he gave to the Applicant especially when in relation to the alleged “loud, heated verbal stoush” on 27 August 2014 Mr Shaun Lloyd says that he “told her she would be terminated immediately if she did it once more”. 12
[47] Further I am not satisfied that the complained of conduct on 27 August 204 actually occurred. The evidence of the Applicant is consistent with the email exchanges on that day whereas the evidence of Mr Shaun Loyd that there was a loud verbal stoush is not consistent with the email exchange.
[48] The notes relied on by Mr Shaun Lloyd and included in his evidence may or may not have been made contemporaneous with the events that they refer to. However I do not accept that those notes accurately record the contents of discussions or conversations or interactions between the Applicant and Mr Shaun Lloyd. I also do not accept that some of the events recorded in the notes actually occurred.
[49] In relation to the “loud verbal stoush” on 27 August 2014 it would appear that the Mr Shaun Lloyd concocted the event and the contemporaneous notes.
[50] Apart from the oral evidence of Mr Shaun Lloyd and his notes of events, which on his evidence were made contemporaneously with the vents, there is nothing in the emails produced by Mr Shaun Lloyd which identifies warnings given to the Applicant or complaints as to her misconduct. By way of example:
● the email exchange on 5 June 2013 concerning the clean desk policy does not disclose any intention of the Applicant not to comply with the policy;
● the email exchange on 12 June 2013 only shows communications between the Applicant and other employees but there is nothing to support the claim from Mr Shaun Lloyd that he had given directions in relation to parking in his car parking space;
● the email exchange on 15 November 2013 clearly identifies that the Applicant accepted the position being put by Mr Shaun Lloyd;
● the email exchange on 10 October 2014 ended on the Applicant’s side with her asking a question of Mr Shaun Lloyd and then he replying dismissively and without bothering to answer the question put.
[51] The conclusion to be drawn is that none of the notes were made contemporaneous with the events allegedly described and the events as described appear not to have occurred.
The contest between the conflicting evidence of the Applicant and Mr Shaun Lloyd is resolved in favour of the Applicant. Her evidence is consistent with the emails.
[52] As the Applicant was not warned that she was at risk of being dismissed, then there has been no compliance with an essential element of the Other Dismissal provisions of the Code.
Summary Dismissal And Notice
[53] The Applicant contended, as a matter of construction of the Code, that because the Respondent paid 5 weeks’ pay in lieu of notice then the Respondent could not rely on the Summary Dismissal Provisions of the Code. Neither party at the proceedings were able to identify any authority on this point.
[54] After the conclusion of proceedings the Respondent drew to the Commissions attention the decision of the Commission in Ryman v Thrash P/L t/as Wisharts Automotive Services. 13 I agree with the conclusion of the Commissioner at [74] of his decision.
[55] The very language of the Code would not prevent an employer from making a payment in lieu of notice at the time of the dismissal whilst arguing that the dismissal was consistent with the Summary Dismissal provisions of the Code when defending an application for an unfair dismissal remedy.
[56] The opening sentence of the Summary Dismissal provision of the Code is:
“It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee's conduct is sufficiently serious to justify immediate dismissal.”
[57] There is no requirement in the Code that the employer at any time specifically use the language of summary dismissal when dismissing the employee. Nor is there any requirement in the Code that the employer must use the form of summary dismissal to effect the dismissal, e.g dismissing an employee on the spot and escorting the employee from the workplace.
[58] What the Code requires is that “the employee's conduct is sufficiently serious to justify immediate dismissal” when viewed from the perspective of the employer who believes on reasonable grounds that that this so.
[59] Making payments in lieu of notice or allowing an employee to continue working for a short period before the dismissal is effected will be matters that could be considered by the Commission as showing that the employer did not believe on reasonable grounds that the employee's conduct is sufficiently serious to justify immediate dismissal. However, they do not of themselves prevent an employer relying on the Summary Dismissal provisions of the Code nor do they prevent the Commission from finding that an employer believes on reasonable grounds that the employee's conduct is sufficiently serious to justify immediate dismissal.
High Income Threshold
[60] Although the Respondent’s jurisdictional objection that the Applicant was earning more than the high income threshold had been dismissed by Commission Blair in earlier proceedings in this same matter on 27 February 2015, PR561709, the Respondent re-agitated that jurisdictional objection in the proceedings before me. In fairness to the Respondent it did so as a result of questions asked by the Commission of Mr Shaun Lloyd and the answers given by him about certain payments made by the Respondent to the Applicant and others.
[61] I consider that the jurisdictional objection, namely that the Applicant was earning more than the high income threshold, was finally determined by Commissioner Blair in his decision on 27 February 2015. That decision was by way of an interim decision in this matter, just as this decision is a further interim decision in the matter.
[62] If the Respondent was not happy with Commissioner Blair’s decision the appropriate course would have been to appeal that decision. It is not an appropriate course to ask the Commission, in the course of this part of the proceedings, to revisit and overturn Commissioner Blair’s decision.
[63] If I were permitted to revisit the issue of the objection that the Applicant was earning more than the high income threshold I would have reached the same conclusion as Commissioner Blair as the evidence before me clearly identifies that the Applicant was not earning more than the high income threshold.
Conclusion
[64] The dismissal of the Applicant was not consistent with the Small Business Fair Dismissal Code.
[65] The application for an unfair dismissal remedy will be listed for further hearing.
COMMISSIONER
Appearances:
Mr G Dircks for the Applicant
Mr M Follett for the Respondent
Hearing details:
Melbourne:
2015.
June 2 and 5.
1 Respondent’s written submissions at para 13(a).
2 Ibid at para 24.
3 [2012] FWAFB 1359.
4 [2006] HCA 45.
5 Ibid Gleeson CJ and Kirby J at para 10.
6 Transcript of proceedings at para 134.
7 Ibid at para 254, 255, 333 to 340.
8 [2013] FWCFB 1943.
9 (2000) 103 IR 160.
10 Transcript of proceedings at para 2636 and 2637.
11 Ibid at para 2643.
12 Ibid at para 2648 and 2649 and Exhibit R1, attachment SL10.
13 [2015] FWC 3942.
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