Kym Wheare v Adelaide Refrigerated Pty Ltd
[2019] FWC 3061
•4 june 2019
| [2019] FWC 3061 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Kym Wheare
v
Adelaide Refrigerated Pty Ltd; Karm Active Solutions Pty Ltd (Liquidator Appointed)
(U2018/11649)
| Commissioner Hampton | ADELAIDE, 4 june 2019 |
Application for an unfair dismissal remedy – two employers named – one employer in liquidation – action dropped against employer in liquidation – no participation in proceedings by entity found to be the employer – respondents properly notified and given opportunity to be heard – matter conducted in employer’s absence – minimum employment period considered – dismissal not effective until communicated to employee – minimum employment period served – dismissal due to alleged misconduct and abandonment of duties – valid reason for dismissal but no procedural fairness – some mitigating factors – dismissal unfair – compensation ordered.
Background
Mr Kym Wheare has made an unfair dismissal application under s.394 of the Fair Work Act 2009 (the FW Act) against his former employer, described in the original application as “Adelaide Refrigerated Interstate Transport”. Leave was later granted to amend the name of this respondent to Adelaide Refrigerated Pty Ltd (Adelaide Refrigerated, or the First Respondent). Mr Wheare also made his application against another entity Karm Active Solutions Pty Ltd (Liquidator Appointed) (Karm, or the Second Respondent). However, as outlined below, he did not ultimately press this aspect of his application.
Adelaide Refrigerated operates an interstate road transport business. At least in Mr Wheare’s case, this involved goods being transported primarily from Adelaide to Melbourne, Sydney or Wagga Wagga, and vice versa. Adelaide Refrigerated was not, at the relevant time, a small business within the meaning of the FW Act.[1] Mr Wheare commenced work as a full-time interstate truck driver in the business in May 2018 and was dismissed from that employment in October or November 2018. The precise dates of those events are important in this matter for reasons to be discussed later.
In his application Mr Wheare states he was dismissed for abandonment of duties, being a decision to let the truck he was driving run out of fuel and to then leave the truck on a major road in Adelaide. Mr Wheare contends that despite repeated notifications to Adelaide Refrigerated he was not given the means to fuel the truck and had to eventually leave the truck due to urgent health reasons.
Having conducted a Directions Conference on 19 March 2019 I issued directions for the filing and service of materials regarding jurisdiction (the correct identity of the respondent and whether the minimum employment period had been served), merit and remedy.
Despite the Commission providing written directions and two reminder emails to the Respondents (being at that stage both Adelaide Refrigerated and Karm), no submissions or witness evidence have been filed on their behalf. The only material received by way of response to Mr Wheare’s application was a Form F3 Employer response to unfair dismissal application and an accompanying email filed on behalf of Adelaide Refrigerated. The Liquidator, acting on behalf of Karm, did however participate in the Directions Conference, provided updated details of the status of that business, and raised an issue about the capacity of the application to proceed against the Second Respondent.
The correct identity of Mr Wheare’s employer and non-participation of the respondents in proceedings
2.1Mr Wheare’s employer
The question of which corporate entity was in fact Mr Wheare’s employer requires some further background.
As set out earlier, Mr Wheare initially named the respondent as “Adelaide Refrigerated Interstate Transport”. On 23 November 2018 the Commission received a response to Mr Wheare’s unfair dismissal application from Adelaide Refrigerated Pty Ltd. This response, the Form F3 (including attachments) stated that it was the employer of Mr Wheare and was accompanied by an email from a Mr M.C. On 28 December 2018, during standard contact between the Commission staff and parties, the Commission was informed that Mr M.C. was no longer engaged by Adelaide Refrigerated.
On 3 January 2019 the Commission received correspondence from Karm, which claimed to be the employer of Mr Wheare, rather than Adelaide Refrigerated. This email nominated Ms Q.K. as contact person for Karm. Ms Q.K. advised the Commission in further correspondence that she works for Karm and that she “cannot participate in this matter unless the application is amended to name Karm Active Solutions Pty Ltd as the respondent.” On 5 March 2019 Ms Q.K. filed a Form F4[2] apparently on behalf of Karm. The crux of this objection was the same as previously advised by Karm; namely their contention that they employed Mr Wheare rather than Adelaide Refrigerated. I note that at this point Karm was already under administration with a liquidator appointed and the liquidator, Worrells Adelaide, subsequently confirmed that it was acting for Karm in that role and participated in a Directions Conference conducted by the Commission on 19 March 2019.
Following the Directions Conference, and in the absence of any responses from the two respondents, I caused an email to be sent to all parties regarding outstanding matters[3] including any issues associated with Karm’s liquidation. The Liquidator was asked to update the Commission on the status of the liquidation; whether the Liquidator intended to provide any response to Mr Wheare’s application and attend the hearing; and whether there were any issues arising under s.500 (or any other provision) of the Corporations Act2001 (Cth) (the Corporations Act) in relation to Karm. On 6 May 2019, the Liquidator provided a response, indicating the liquidation was ongoing, that the Liquidator did not intend to provide a response or take any part in the hearing, and that, at least in respect to Karm, Mr Wheare would require leave of the Court to continue his application given the import of s.500 of the Corporations Act. I observe that s.500(2) of the Corporations Act prevents civil proceedings from beginning or continuing against a company in liquidation in certain circumstances without leave of the Court. This correspondence was copied to Mr Wheare.
In light of the position taken by the Liquidator and Mr Wheare’s view that it was Adelaide Refrigerated that employed, paid and dismissed him, during the hearing of this matter the applicant elected not to proceed with his application against Karm and confirmed his intention to proceed only against Adelaide Refrigerated.
In relation to the correct identity of the employer in this matter, I am satisfied that Adelaide Refrigerated was Mr Wheare’s employer. This is confirmed by the original Form F3, the information provided to the applicant during his employment and the letter confirming the dismissal, which was clearly communicated by, and in the name of, the First Respondent.
2.2Non-participation of the Respondents in proceedings
Karm did not participate in the hearing however as outlined above the application was not pressed against it and based upon the evidence before the Commission I have found that it was not the employer.
No substantive materials were received from Adelaide Refrigerated as required by the Directions. Adelaide Refrigerated did not attend the hearing.[4]
Adelaide Refrigerated was properly notified of Mr Wheare’s application, the Directions, and the time and place of the Directions Conference and the hearing ultimately conducted in this matter. I am satisfied that Adelaide Refrigerated has been given every reasonable opportunity to respond to the application and be heard.
Section 600 of the FW Act permits the Commission to deal with an application in the absence of a party and given the above I consider that it was appropriate and reasonable to do so in this case.
Despite non-attendance at the hearing by either Adelaide Refrigerated or Karm, and non-participation in proceedings generally by Adelaide Refrigerated, I did require Mr Wheare to give sworn evidence and to deal with the matters raised in the initial Employer response and accompanying email advanced on behalf of Adelaide Refrigerated. I also sought additional evidence and tested his evidence more generally, noting that there was no alternative evidence or material properly before the Commission.
I consider Mr Wheare gave evidence honestly and openly; however the absence of any proper material from Adelaide Refrigerated means that many matters that are critical to the ultimate findings made in this matter were left unchallenged.
The requirement to complete a minimum employment period under the Act
Mr Wheare claims he commenced employment at Adelaide Refrigerated on 8 May 2018 and worked there until his dismissal on 8 November 2018; being a (completed) period of 6 months and 2 days inclusive. In their initial Employer response, Adelaide Refrigerated foreshadowed a jurisdictional objection to Mr Wheare’s application; claiming he had not worked the minimum employment period (MEP) required under the Act. This, it claimed, was relating to an extended probationary period. In effect, Adelaide Refrigerated stated that Mr Wheare commenced employment on 9 May 2018 and that he was notified of his dismissal on 23 October 2018; being 5 months and 15 days inclusive. It also emerged during the hearing of this matter that Mr Wheare had been subject to periods where no work was provided and he was not being paid. This aspect may also be relevant to the MEP.
In establishing the unfair dismissal jurisdiction of the Commission, the Parliament through the FW Act, has also created some limitations on the circumstances in which an application of that sort can be brought. One of those limitations is the requirement for an applicant employee to have completed a MEP. The length of that period depends upon the size of the employer.
Section 382 of the FW Act provides as follows:
“382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a)the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and
(b) one or more of the following apply:
(i) a modern award covers the person;
(ii)an enterprise agreement applies to the person in relation to the employment;
(iii)the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.”
This means that unless an applicant employee has completed a period of employment with his or her employer of at least the relevant MEP, they will not be a person who is protected from unfair dismissal and thereby not eligible to bring an unfair dismissal application. Section 390(1)(a) of the FW Act also confirms that an applicant employee cannot be found to have been unfairly dismissed if they are not “protected” within the meaning of the relevant Part of the legislation.[5]
The length and nature of the MEP is defined in s.383 of the FW Act in the following terms:
“383 Meaning of minimum employment period
The minimum employment period is:
(a)if the employer is not a small business employer—6 months ending at the earlier of the following times:
(i) the time when the person is given notice of the dismissal;
(ii) immediately before the dismissal; or
(b)if the employer is a small business employer—one year ending at that time.”
Based upon the only information before the Commission, Adelaide Refrigerated was not a small business at the relevant time. Accordingly, Mr Wheare must have completed 6 months service at the earlier of the time he was given notice of dismissal or immediately before the dismissal.
Section 384 of the FW Act relevantly defines the period of employment in the following terms:
“384 Period of employment
(1)An employee’s period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee.
(2) … …. “
I will shortly return to the meaning of continuous service as it potentially impacts upon the length of Mr Wheare’s employment period. The matters that initially require determination are the actual date of the commencement of employment and the date when Mr Wheare was given notice of dismissal or the date of that dismissal. These latter two being the reference points for the conclusion of the period in line with s.383 of the Act.
Mr Wheare could not recall the actual starting date with any certainty, but considered that it was likely to be 8 May 2018. Adelaide Refrigerated stated in the Form F3 that the applicant commenced employment on 9 May 2018, and correspondence provided with that response associated with a “probationary period” is consistent with that date. For reasons that will become clear, it is sufficient to find that the applicant’s employment commenced on either 8 or 9 May 2018.
The determination of the concluding reference point is more complex. Adelaide Refrigerated suggested in its Form F3 response that Mr Wheare’s dismissal took effect on 21 October 2018. There is a letter purporting to confirm the dismissal which is dated 23 October 2018. This was attached to the response. However, Mr Wheare gave evidence that this letter was provided to him only via an Officer at the Fair Work Ombudsman (FWO) whom the applicant had been in contact with to seek assistance about not being paid for certain periods when he was not being provided work by the First Respondent. Further, his evidence is that this was the first indication that he was being dismissed and this did not take place until 8 November 2018.
I note that on 7 November 2018 in correspondence between the FWO and Adelaide Refrigerated concerning Mr Wheare, the FWO sought confirmation that the applicant had actually been informed of any purported termination of employment and this is the context in which the letter of dismissal was provided to that Officer. Further, and in any event, there is no evidence to contradict Mr Wheare’s contention that he had not been informed of his dismissal prior to the advice provided to him via the FWO on 8 November 2018.
On the contrary, the evidence that has been provided by Mr Wheare is that in the period after he left the truck late on 21 October 2018, he had been in regular contact with one of the Supervisors/Fleet Controllers at Adelaide Refrigerated who had indicated that the applicant should just continue to ring the depot for his next assignments and that there is “no reason you’d lose your job”.[6] Further, the evidence is that Mr Wheare did not receive any response to the numerous contacts made by him to the Adelaide depot.
On that basis, there was no communication of any dismissal by Adelaide Refrigerated to Mr Wheare until 8 November 2018. It is generally considered that a dismissal does not take effect unless and until it is communicated to the employee who is being dismissed. A dismissal can be communicated orally. Where the communication is in writing only, the communication must be received by the employee in order for the termination to be effective.[7]
In this case, the dismissal was not communicated in any form to Mr Wheare until 8 November 2018. Any purported dismissal was not effective until that point. This means that the time when notice was given and the actual dismissal, was 8 November 2018 for the purposes of the MEP.
Subject to there being continuous service, this is a completed period of at least 6 months.[8]
It is therefore necessary to consider the impact upon the service, if any, of the periods when Mr Wheare was employed as a full-time driver, but not being provided with work and not being paid.
The meaning of “continuous service” is relevantly provided by s.22 of the FW Act in the following terms:
“22 Meanings of service and continuous service
General meaning
(1)A period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include any period (an excluded period) that does not count as service because of subsection (2).
(2)The following periods do not count as service
(a)any period of unauthorised absence;
(b)any period of unpaid leave or unpaid unauthorised absence, other than:
(i)a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or
(ii)a period of stand down under Part 3-5, under an enterprise agreement that applies to the employee, or under the employee’s contract of employment; or
(iii)a period of leave or absence of a kind prescribed by the regulations;
(c)any other period of a kind described by the regulations.
(3)An excluded period does not break a national system employee’s continuous service with his or her national system employer, but does not count towards the length of the employee’s continuous service.
(3A)Regulations made for the purposes of paragraph (2)(c) may prescribe different kinds of periods for the purposes of different provisions of this Act (other than provisions to which subsection (4) applies. If they do so, subsection (3) applies accordingly.[9]
… …”
Mr Wheare stated during the hearing that there were periods during which he was, in effect, placed on ‘stand by’ and not given any work. The longest of these, he suggested, was for a period of three weeks.[10] Given my findings about the date of his dismissal, a further similar period took place between 21 October and 8 November 2018.
Based upon the only available evidence, the periods concerned were not stand-downs of the kind referred to in s.22(2)(b)(ii) and in any event could not be described as being a period of unpaid leave or unauthorised absence as contemplated by s.22(2)(a) or (b). As a full-time employee, Mr Wheare was entitled to be paid for any such periods at least at the minimum award rate[11] and was not on leave or absent within the meaning of s.22(2) of the FW Act.
As a result, I find that all of the service between 8 or 9 May 2018 and 8 November 2018 was continuous service for present purposes. This means that Mr Wheare did serve the required minimum employment period and was protected from unfair dismissal.
Having satisfied myself that the correct respondent has been identified, and that Mr Wheare has met the jurisdictional prerequisites for protection from unfair dismissal it is appropriate to consider the merits of Mr Wheare’s application and, if warranted, what remedy should be ordered. Before doing so, it is convenient to make findings about the events that took place on 21 October 2018 based upon the evidence that is before the Commission.
Findings on the events leading to the “abandonment” of the truck on 21 October 2018
Mr Wheare worked as an interstate truck driver for the company, primarily transporting goods between Adelaide and Melbourne, though sometimes as far as Sydney or Wagga Wagga. Interstate journeys would generally occur twice a week.
Mr Wheare worked full-time in this position and was paid 41.87 cents per kilometre for interstate journeys, in addition to certain allowances and payments. By operation of the FW Act, this applied subject to the provisions of the relevant modern award; being, the Road Transport (Long Distance Operations) Award 2010.
Mr Wheare primarily drove B-double trucks on these journeys. He gave evidence that he had raised concerns regarding the working condition of these vehicles. Mr Wheare recalled issues with air conditioning, steering and tyres of some trucks.[12]
Before these journeys the trucks were generally fuelled at the Adelaide Refrigerated depot. Mr Wheare was given a fuel card that was used to record the fuel consumed at that depot, however this was an internal card that was not recognised by external fuel providers. The Melbourne depot used by the First Respondent did not have a fuel bowser available to Adelaide Refrigerated drivers and so an alternative source of fuel was used. Until sometime in the weeks before 21 October 2018, the trucks on the Melbourne run were generally refuelled at a Caltex service station in Stawell. Payment for this fuel was made under some form of arrangement whereby an image of a fuel card would be presented at the counter.[13] A time came when this approach was no longer accepted by the service station and a proper card was required. Mr Wheare reported this change in practice to Adelaide Refrigerated and requested a physical fuel card. Mr Wheare was assured things would be alright and that he did not need to worry about this. A fuel card was not supplied to him for that purpose.
On Sunday 21 October 2018, Mr Wheare was driving the return leg of a round trip from Adelaide to Melbourne via Stawell. The truck had initially been fuelled at the Adelaide depot, but was not refuelled in Melbourne or in Stawell for the reasons identified above. When in the vicinity of Pimpinio, Mr Wheare became particularly concerned regarding the amount of fuel left in his truck and reported this to Adelaide Refrigerated by telephone. Mr Wheare was instructed to put his own fuel into the truck. After informing Adelaide Refrigerated he could not afford to refuel the truck, Mr Wheare was instructed to call back once he reached Nhill.
Upon arrival at Nhill, Mr Wheare attempted to telephone the company back but the call was not answered. Mr Wheare subsequently made multiple attempts to call the company but none of these calls were answered. Mr Wheare continued to drive the truck to the Adelaide depot of the First Respondent but the vehicle eventually ran out of fuel on Portrush Road in the Eastern suburbs of Adelaide at around 11:30 pm.
Mr Wheare remained with the truck for some time while attempting to call the 24-hour support line of Adelaide Refrigerated. These attempts were unsuccessful. Mr Wheare gave evidence that he was becoming increasingly concerned as he was dehydrated and experiencing a medical condition. Unable to successfully contact Adelaide Refrigerated, and with a worsening medical condition, Mr Wheare left the truck, took a taxi to the depot and drove his own car home to attend to his condition. Mr Wheare left the truck sometime after midnight (early in the morning of Monday 22 October). Mr Wheare gave evidence that he paid for the taxi using cash that had been left in his car.[14]
When leaving the truck, Mr Wheare chose to leave the keys left in the ignition. His explanation for doing so was that his employer would need immediate access to the keys to move the truck when it was refuelled. He also asserted that it was common for truck drivers to leave keys somewhere on the vehicle in similar circumstances and that there was no risk to the truck as it was not simply a matter of refuelling the empty diesel vehicle and driving off. Even if this is so, Mr Wheare could not satisfactorily explain to the Commission why he did not lock the vehicle and take the keys to the depot where he had to go to collect his own car. I will return to the implications of these events as part of my subsequent consideration.
The next morning, Adelaide Refrigerated contacted Mr Wheare by text message to follow up the situation. Mr Wheare explained what had happened, including his attempts to contact the 24-hour support line, why he had to leave the truck and why he went home. Adelaide Refrigerated told Mr Wheare they would consider the situation call him back. Mr Wheare gave evidence that he received no official communication or response from the First Respondent after that time.[15]
Was Mr Wheare’s dismissal unfair within the meaning of the FW Act?
Section 385 of the FW Act provides as follows:
“385 What is an unfair dismissal
(1) A person has been unfairly dismissed if the FWC is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.”
Mr Wheare was dismissed, the employer is not a small business within the meaning of the FW Act, and the concept of a genuine redundancy is not relevant here.
On that basis, the dismissal will be unfair if it is found to be harsh, unjust or unreasonable.
The FW Act relevantly provides 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 is 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.”
It is clear that s.387 of the FW Act contemplates an overall assessment as to the nature of the dismissal being made by the Commission. In so doing, the FW Act sets out a number of considerations that must, where relevant, be treated as a matter of significance in the decision making process and weighed up accordingly.
It is convenient therefore to use the various provisions of s.387, with reference to the relevant circumstances, to outline my consideration of the matter.
Section 387(a) – whether there was a valid reason for the dismissal related to Mr Wheare’s capacity or conduct (including its effect on the safety and welfare of other employees).
Valid in this context is generally considered to be whether there was a sound, defensible or well-founded reason for the dismissal. Further, in considering whether a reason is valid, the requirement should be applied in the practical sphere of the relationship between an employer and an employee where each has rights, privileges, duties and obligations conferred and imposed on them. That is, the provisions must be applied in a practical, common sense way to ensure that the employer and employee are each treated fairly.[16]
The failure to follow a lawful instruction or comply with policy which was reasonable in the circumstances may provide an employer with a valid reason to terminate an employee’s employment.[17] It is however, clear from the authorities that the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts before the Commission. That is, it is not enough for an employer to rely upon its reasonable belief that the termination was for a valid reason.[18] Equally, facts justifying dismissal, which existed at the time of the termination, should be considered, even if the employer was unaware of those facts and did not rely on them at the time of dismissal.[19]
As earlier discussed, the Adelaide Refrigerated did not attend the Hearing or provide material beyond an initial Employer response. Nevertheless, the FW Act requires that I have regard to s.387(a) and whether there was a relevant valid reason for the dismissal. Accordingly, I have considered the untested propositions advanced in that Employer response and whether they constitute a valid reason for dismissal based upon the evidence that is properly before the Commission.
Adelaide Refrigerated claimed Mr Wheare’s dismissal was for abandonment of duties. This abandonment, they suggested, including Mr Wheare leaving the key in the ignition of the vehicle and that valuable customer products were left in the trailers. Adelaide Refrigerated also identified that Mr Wheare had been issued with an improvement notice on 16 August 2018 relating to several instances of incomplete refuelling paperwork.[20] There is nothing before the Commission to provide any context or support around the alleged improvement notice.
In relation to the alleged “abandonment”, there appears to be three elements. Firstly, the circumstances leading to the vehicle running out of fuel to begin with. Given the potential consequences of this event, particularly for a diesel vehicle of this kind, in normal circumstances this of itself would represent a major issue going to the driver’s conduct. However, in this matter the only evidence before the Commission is that Mr Wheare was not, despite requests, given the means to refuel the vehicle, he advised the employer during the trip that he was unable to obtain fuel and would probably run out, and was given no reasonable option or instructions. In that light, the fact that the vehicle was driven until it ran out of fuel is the responsibility of Adelaide Refrigerated.
Secondly, that Mr Wheare did not stay with the vehicle. Again, at least in some cases, this of itself could be an issue. However, the only evidence before the Commission is that Mr Wheare tried numerous times to contact the dedicated 24 hour help line operated by the First Respondent but this went unanswered. Further, having driven from Melbourne, given the time of day, and needing to attend his home to deal with a medical issue, it was not unreasonable for Mr Wheare to leave the vehicle.
Thirdly, Mr Wheare does not dispute that he left the keys in the ignition when leaving the truck. Adelaide Refrigerated was not present to challenge Mr Wheare’s claims that the normal practice is to leave keys with broken-down vehicles in some “secure” location in or on the vehicle concerned. However, and in any event, this is not what Mr Wheare did. In leaving the keys in the ignition, they were easily accessible by someone wanting to enter the unlocked cabin and this increased the risk of theft or damage. Further, given he had to return to Adelaide Refrigerated’s (secured) depot to access his car (both to collect money for the taxi and to subsequently drive home), Mr Wheare had access to that site and could easily have left the keys at the depot with any further message about the location and status of the vehicle.
Mr Wheare’s did not have a satisfactory explanation for his decision to leave the keys in the ignition when leaving the truck and in all the circumstances evident here, this was misconduct. In my view, this conduct also provided a valid reason for dismissal.
Section 387(b) – whether Mr Wheare was notified of the reasons for dismissal.
This consideration requires the Commission to assess whether the applicant concerned was relevantly notified of the reasons leading to the dismissal before that decision was taken.[21]
The evident purpose of this consideration is that notification of the valid reason to terminate must be given to the employee before the decision to terminate the employee is made and the notification needs to be in explicit and clear terms.
There was no process involving Mr Wheare leading to the dismissal and he was not notified of the reasons for that action.
Section 387(c) – whether Mr Wheare was given an opportunity to respond to any reason related to his capacity or conduct.
The relevant reasons are those arising from the valid reasons found by the Commission. This consideration is therefore directly related to the above discussion.
This process contemplated by the FW Act does not require any formality and is to be applied in a common sense way to ensure the employee has been treated fairly.[22]
There was no opportunity given to respond to the reason.
Section 387(d) – any unreasonable refusal by the respondent to allow Mr Wheare a support person.
There was no context in which Mr Wheare could have a support person but this meant that no request was made. Accordingly, this consideration is not relevant in this case.
Section 387(e) – if the dismissal is related to unsatisfactory performance by Mr Wheare – whether he has been warned about that unsatisfactory performance before the dismissal.
This consideration relates to performance of the job. Performance in this context includes the employee’s capacity to do the work, and the diligence and care taken with that work.[23]
There is no evidence to support the notion that any warning was provided to Mr Wheare.
Section 387(f) – the degree to which the size of the respondent’s enterprise would be likely to impact on the procedures followed in effecting the dismissal.
Section 387(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.
I deal with these two considerations together.
Nothing is before the Commission to inform these considerations, other than the size of the business; stated to be more than 50 employees.[24]
Section 387(h) - other matters considered to be relevant.
Amongst other considerations, the Commission should have regard to the impact of the dismissal upon Mr Wheare given all of the circumstances. This includes consideration as to whether the dismissal was harsh.[25] The question of whether a dismissal is “harsh” involves the exercise of discretion. The discretion is broad and is constrained only by the requirement to take into account the matters specified in s.387(a) to (h) of the FW Act, including any matters the decision-maker considers to be relevant (s.387(h)). Ultimately, the determination of whether a dismissal is “harsh” requires the making of a broad evaluative judgment by the Commission.[26]
Consistent with this approach, a dismissal may, depending upon the overall circumstances, be considered to be harsh on the applicant employee due to the economic and personal consequences resulting from being dismissed or because it is disproportionate to the gravity of the misconduct.[27]
Mr Wheare had not been with the First Respondent for long, however the loss of his full-time employment had the normal consequences that often follow such events.
As outlined earlier, there was no communication from Adelaide Refrigerated to Mr Wheare from the day after he left the vehicle on Portrush Road until he was advised, via a communication provided only to the FWO and not to the applicant, that he had been dismissed. This, and absence of any payment to him in that period as a full-time, still engaged employee, are factors relevant to the characterisation of this dismissal for present purposes.
Mr Wheare was apparently paid a week’s payment ($857.28) in lieu of notice, and his accrued entitlements calculated up until 21 or 23 October 2018, following his dismissal.
Conclusions on the dismissal
I have weighed all of the factors and circumstances of this application.
As outlined earlier, the FW Act requires a global assessment having regard to the various relevant statutory considerations. In that context, procedural unfairness is an important consideration given the provisions of the FW Act but does not necessarily mean that the dismissal was unfair. This is reinforced by the objects relating to Part 3-2 Unfair Dismissal of the FW Act in s.381 which relevantly provides as follows:
“381 Object of the Part
… …
(2) The procedures and remedies referred to in paragraphs (1)(b) and (c), and the manner of deciding on and working out such remedies, are intended to ensure that a “fair go all round” is accorded to both the employer and employee concerned.
Note: The expression “fair go all round” was used by Sheldon J in in re Loty and Holloway v Australian Workers’ Union [1971] AR (NSW) 95.”
I have found the existence of a valid reason and there are some competing considerations as to whether the dismissal was harsh in all of the circumstances. This includes the seriousness of the conduct and the context in which it occurred, the impact of the dismissal, the absence of any prior warning, the payment in lieu of notice, the short period of service, and some personal mitigating factors that contributed to the events on 21 October 2018.
As revealed in various decisions of the Commission (and the Court), each case must be considered in its own circumstances and it is appropriate, amongst other factors, to have regard to whether any procedural deficiencies and other considerations made any difference to the overall fairness of the outcome.[28]
In this case, the complete absence of any procedural fairness and the treatment of Mr Wheare between the incident and his ultimate dismissal, in the overall context of this matter, has led me, on balance, to consider that the dismissal was harsh and unreasonable.
Remedy
Mr Wheare does not seek reinstatement to his former position, but rather, compensation. In that regard, I note that the applicant sought that any compensation include the alleged underpayment for those weeks when he was employed but not being paid. Given the scope of the Commission’s present jurisdiction, this is not something that I can deal with and remains a matter for a Court of competent jurisdiction if a claim is made.
Division 4 of Part 3-2 of the FW Act relevantly provides as follows:
“Division 4—Remedies for unfair dismissal
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.
Note: Division 5 deals with procedural matters such as applications for remedies.
… …
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.
393 Monetary orders may be in instalments
To avoid doubt, an order by the FWC under subsection 391(3) or 392(1) may permit the employer concerned to pay the amount required in instalments specified in the order.”
The prerequisites of ss.390(1) and (2) have been met in this case.
Section 390 of the FW Act makes it clear that compensation is only to be awarded as a remedy where the Commission is satisfied that reinstatement is inappropriate and that compensation is appropriate in all the circumstances. Reinstatement is not sought and I find that reinstatement would be inappropriate.
As set out above, under the FW Act, it is then necessary to consider whether compensation in lieu of reinstatement is appropriate.
A Full Bench in McCulloch v Calvary Health Care Adelaide[29] (McCulloch) confirmed, in general terms, that the approach to the assessment of compensation as undertaken in cases such as Sprigg[30] remains appropriate in that regard.
Section 392(2) of the FW Act requires me to take into account all of the circumstances of the case including the factors that are listed in paras (a) to (g). Without detracting from the overall assessment required by the FW Act,[31] it is convenient to discuss the identified considerations under the various matters raised by each of the provisions.
The effect of the order on the viability of Adelaide Refrigerated
Given the non-participation of the respondent, nothing was put on this aspect.
The length of Mr Wheare’s service with Adelaide Refrigerated
Mr Wheare served with Adelaide Refrigerated for a period of 6 months. This is a short period and militates against any significant award of compensation.
The remuneration Mr Wheare would have received, or would have been likely to receive, if he had not been dismissed
This involves, in part, a consideration of the likely duration of Mr Wheare’s employment in the absence of what I have found to be an unfair dismissal. That is, the establishment of the anticipated period of employment.[32]
As with many cases, the assessment of the anticipated period of employment in this case requires a broad assessment of competing considerations. Mr Wheare was not a long-serving employee. Further, there is at least some suggested history of the employer raising concerns with Mr Wheare’s paperwork but no warnings had been provided. There were however some issues arising from his concerns about the management of the business and his treatment. Despite his contention that he would have remained in employment until at Christmas 2018, this is my view was based upon some unsound assumptions. This included that his preferred Fleet Manager would be the only manger dealing with him and that there would no consequences of his actions on the night of 21 October 2018. Indeed, I find that that his employment at Adelaide Refrigerated would not have continued in the medium or longer term.
In all of the circumstances evident here, I consider that the anticipated period of employment for Mr Wheare should be no more than an additional 4 weeks, including a period of notice. This reflects the balancing of the considerations set out above.
In the absence of the dismissal, Mr Wheare would have been paid at the rate of $1,386 per week (plus superannuation) for each of those weeks. This has been derived using the trip rates provided to Mr Wheare early on his employment[33] and applied to his evidence that he would normally undertake the equivalent of two trips to Melbourne each week. I have also included a standard pick- up and delivery in that calculation.
The projected remuneration that Mr Wheare would have received based upon the anticipated period of employment with Adelaide Refrigerated would therefore have been $5,544 (plus superannuation).
The efforts of Mr Wheare to mitigate the loss suffered by him because of the dismissal
I accept that Mr Wheare has made some efforts to mitigate his losses.
No discount to the amount of compensation is warranted based upon this consideration.
The amount of any remuneration earned by Mr Wheare from employment or other work during the period between the dismissal and the making of the order for compensation
The amount of any income reasonably likely to be so earned by Mr Wheare during the period between the making of the order for compensation and the actual compensation
I deal with these considerations together.
Mr Wheare found new employment, as a casual employee, in late December 2018. He has also secured some further work during 2019.
As the new employment all falls outside of the projected remuneration period calculated above, I do not consider that it is reasonable or appropriate to make a deduction on the basis of that remuneration in this case.
Mr Wheare was paid a week in lieu of notice ($857.28) following his dismissal and this should be taken into account and deducted from the projected remuneration loss.
Any other matter that the FWC considers relevant and the remaining statutory parameters
I have taken into account the projected nature of the anticipated loss of remuneration over a known period and given the circumstances of this case it is not appropriate to make a further allowance for contingencies.[34]
Mr Chapman is presently 53 years of age.
There is some demonstrated misconduct that should be taken into account as provided by s.392(3) of the FW Act. I will make a deduction of 30 % of the compensation otherwise due in this case.
In accordance with s.392(4) of the FW Act, I make no allowance for any shock, distress or humiliation that may have been caused by the dismissal. I also observe that compensation in this context is not in the nature of damages or a penalty for the actions of the employer.
The maximum compensation limit in this case is the lesser of 26 weeks remuneration or the statutory cap of $69,450[35] and does not impact upon the compensation order.
Taxation would be payable on any amount determined.
Given Mr Wheare’s lost remuneration included superannuation, I consider that this should be reflected in the compensation order as an additional payment having regard to the rate of superannuation provided by the Superannuation Guarantee (Administration) Act 1992; being 9.5%.[36]
Conclusions on remedy
Having regard to the circumstances of this matter applied to the considerations established by s.392 of the FW Act, I consider that it is appropriate to make an award of compensation in lieu of reinstatement to Mr Wheare. Further, I consider that the compensation should amount to $3,281.00 (plus an amount to be paid as superannuation to a relevant Superannuation fund on Mr Wheare’s account); which has been derived having regard to the projected remuneration loss and the other factors discussed above. I consider this award to be fair and reasonable given all of the circumstances set out above.
Conclusions and Orders
For reasons set out above, I have found that Mr Wheare:
Is protected from unfair dismissal;
Was unfairly dismissed by Adelaide Refrigerated Pty Ltd within the meaning of the FW Act; and that
- Compensation in lieu of reinstatement is appropriate and is to be $3,281.00 plus $312.00 to be paid as superannuation.
The compensation is to be paid by Adelaide Refrigerated Pty Ltd within 14 days of this decision.
An order[37] giving effect to this decision is being issued concurrently.
COMMISSIONER
Appearances:
K Wheare, the applicant, on his own behalf.
No appearance on behalf of Adelaide Refrigerated Pty Ltd, the First Respondent.
No appearance on behalf of Karm Active Solutions Pty Ltd (Liquidator Appointed), the Second Respondent.
Hearing details:
2019
Adelaide
9 May 2019.
Final written submissions:
9 May 2019, from the applicant.
<PR707964>
[1] Section 23 of the FW Act.
[2] Objection to unfair dismissal application.
[3] The other issues being the narrow scope and form of Mr Wheare’s evidence, and that no materials had been received from Adelaide Refrigerated or Karm.
[4] Conducted as a Determinative Conference.
[5] No issue arises under s.382(b) of the FW Act in this matter given the applicant’s rate of earnings and coverage of his employment by a modern award.
[6] Exhibit 1.
[7] See Ayub v NSW Trains[2016] FWCFB 5500 at [17], Burns v Aboriginal Legal Service of Western Australia (Inc), (2000) AIRC Print T3496 at [24] and Plaksa v Rail Corporation NSW[2007] AIRC 333 at [8].
[8] Acts Interpretation Act 1901 (Cth) s. 2G.
[9] There are no relevant exclusions provided by the Regulations.
[10] Hearing audio at 11:21 am.
[11] Clause 13.1 of the Road Transport (Long Distance Operations) Award 2010.
[12] Hearing audio at 11:26 am.
[13] Hearing audio at 11:27 am.
[14] Hearing audio at 11:33 am.
[15] Hearing audio at 11:37 am.
[16] Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371 as cited in Potter v WorkCover Corporation (2004) 133 IR 458 and endorsed by the Full Bench in Industrial Automation Group Pty Ltd T/A Industrial Automation [2010] FWAFB 8868, at [36].
[17] Cox v South Australian Meat Corporation [1995] IRCA 287 (13 June 1995) per von Doussa J.
[18] See Australia Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1; King v Freshmore (Vic) Pty Ltd AIRCFB Print S4213 (17 March 2000) per Ross VP, Williams SDP, Hingley C; Edwards v Giudice (1999) 94 FCR 561; Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport AIRCFB Print S5897 (11 May 2000) per Ross VP, Acton SDP and Cribb C, and Rode v Burwood Mitsubishi AIRCFB Print R4471 (11 May 1999) per Ross VP, Polites SDP, Foggo C.
[19] Shepherd v Felt & Textiles of Australia Ltd (1931) 45 CLR 359, 373, 377‒378; Australia Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1, 14. See also Dundovich v P & O Ports AIRC PR923358 (8 October 2002), per Ross VP, Hamilton DP, Eames C at [79]; Lane v Arrowcrest (1990) 27 FCR 427, 456; cited with approval in Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410, 467 and 468.
[20] Annex C to exhibit 6 – marked only for identification.
[21] See Trimatic Management Services Pty Ltd v Daniel Bowley [2013] FWCFB 5160.
[22] RMIT v Asher (2010) 194 IR 1. See also Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137 at [75].
[23] See Anetta v Ansett Australia Ltd (2000) 98 IR 233.
[24] Employer response form.
[25] Australia Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1.
[26] Reliable Petroleum Pty Ltd v Murray[2017] FWCFB 5843 at [17].
[27] See also Byrne v Australian Airlines Ltd (1995) 185 CLR 410, 465.
[28] See Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport AIRCFB Print S5897 per Ross VP, Acton SDP and Cribb C, 11 May 2000 and Villani v Holcim (Australia) Pty Ltd [2011] FCAFC 155 as examples.
[29] [2015] FWCFB 873.
[30] Sprigg v Paul’s Licensed Festival Supermarket (1998) 88 IR 21. See also Bowden v Ottrey Homes Cobram and District Retirement Villages Inc T/A Ottrey Lodge[2013] FWCFB 431.
[31] Smith and Others v Moore Paragon Australia Ltd (2004) 130 IR 446.
[32] McCulloch v Calvary Health Care Adelaide[2015] FWCFB 873.
[33] Exhibit 3.
[34] See the discussion of contingencies in McCulloch at [20] – [23]; Bowden v Ottrey Homes Cobram and District Retirement Villages Inc T/A Ottrey Lodge[2013] FWCFB 431, at par [52]; Ellawala v Australian Postal Corporation AIRC Print S5109, per Ross VP, Williams SDP and Gay C, 17 April 2000 and in Enhance Systems Pty Ltd v James Cox AIRC Print PR910779, per Williams SDP, Acton SDP and Gay C, 31 October 2001.
[35] Section 392(5) of the FW Act.
[36] Superannuation Guarantee (Administration) Act 1992 s 19(2).
[37] PR708869.
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