Lai Yu v Crown Resorts Limited - [2022] FWC 2505

[2022] FWC 2505

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394—Unfair dismissal

Lai Yu
v

Crown Resorts Limited

(U2022/6132)

DEPUTY PRESIDENT MASSON

MELBOURNE, 20 SEPTEMBER 2022

Application for an unfair dismissal remedy - dismissal found to be unfair – reinstatement not appropriate - compensation ordered.

On 8 June 2022, Lai Yu (the Applicant) made an application to the Fair Work Commission (the Commission) under s.394 of the Fair Work Act 2009 (Cth) (the Act) for a remedy, alleging she had been unfairly dismissed from her employment with Crown Resorts Limited (the Respondent) on 20 May 2022 for the purposeful mishandling of tips in its Nobu restaurant. The Applicant seeks an order for compensation.

Conciliation of the matter before the Commission failed to achieve a resolution and consequently the matter was listed for hearing/conference before me on 12 & 13 September 2022. After hearing from the parties, I determined to conduct a hearing pursuant to s.399 of the Act.

At the hearing, the Applicant was self-represented and gave evidence. The Respondent was represented by its Group General Manager Industrial Relations Brendan Richardson, who called the following witnesses to give evidence:

Carlie Barnewall – People and Culture Advisor

Tim Sharland – Investigator
Daniel Khoo – Executive Sous Chef

Background and evidence

The Applicant’s employment

The Applicant comes from Mainland China and has been a resident of Australia since late 2014, with her first language being Mandarin Chinese. She commenced employment on a full-time basis with the Respondent as a Commis Chef at the Nobu restaurant at the Respondent’s Southbank, Melbourne complex on 14 December 2015.[1] The Respondent employs approximately 10,000 employees at its Melbourne complex which, according to Ms Barnewall, is Victoria’s largest single site employer[2].

In or about September 2019, the Applicant was promoted to the position of Chef de Partie in the Nobu restaurant[3], in which position she remained until the termination of her employment. The Chef de Partie position at Nobu formally reports to the position of Chef de Cuisine[4] but that position had been vacant for several months prior to the Applicant’s dismissal which had resulted in the Applicant reporting in that period to the Sous Chef, Ray Or. The Position Summary of Chef de Partie relevantly states as follows;

“The Chef de Partie provides directs support to the business unit management team in the aim of achieving the successful implementation, development and maintenance of all operational procedures, standards and goals. This role is accountable for overseeing a section of the kitchen to ensure that the overall operation runs smoothly and effectively. Operational standards must be in accordance to Crown five star standards and all times meet guest expectations.
To enhance the customer experience by delivering service improvements in line with workplace instructions (WPI) and ensuring that all employees are properly trained to meet the customer needs as detailed in the workplace instructions. Monitor staff engagement and recommend to manager necessary improvements to meet the requirements. Oversee the outlet presentation, ensure the consistency of quality products and service.”[5]

The Applicant agreed during cross-examination that in her capacity as Chef de Partie she was required under the position description to;

support the Food and Beverage Management Team;
maintain operational standards and procedures;
maintain outlet workplace instructions;
adhere to policies and procedures; and
assist the management team in leading a working culture in the Nobu outlet.

The Applicant also confirmed that she was responsible for a section of the kitchen and supervising several staff, agreed that the Respondent had various policies in place, accepted that she was responsible for being aware of those policies and agreed that the distribution of tips to staff should be properly administered and fair.
The Applicant further states that during her employment with the Respondent she was not subject to any warnings prior to her dismissal for allegedly stealing tips. She also states that her responsibilities as Chef de Partie did not ordinarily include her dealing with tips, that she was only asked to handle tips about three times by her then manager in 2021 and that the last time she was asked to count, calculate and distribute the tips money was in about December 2021[6].
The Applicant was covered in her employment with the Respondent by the Hospitality Industry (General) Award 2020[7] (the Award) and at the time of her dismissal was in receipt of a weekly base salary (excluding superannuation) of $1550.13[8], which equates to an annual base salary (excluding superannuation) of $80,606.97. Her total annual remuneration package including superannuation at the time of her dismissal was $88,667.67[9].

Tips policy and procedure

The Respondent has a ‘Gifts, Tips and Gratuities & Supplier Gifts and Gratuities Policy’[10] (the Policy) which applies to all its employees and relevantly states that failure to comply with the Policy may result in disciplinary action[11]. The Policy operates in conjunction with the ‘Benefits or Gifts & Gratuities Handling Procedure’[12] (the Procedure). According to Ms Barnewall, the Policy primarily concerns licensed employees and operational employees engaged in outlets such as the Nobu restaurant set their arrangements for managing tips within the parameters of the Policy based on the Procedure[13].

The Procedure goes into considerable detail regarding tips participation eligibility, tip allocation - vote process, tip allocation - method of distribution, communication of tips handling procedure, tips distribution and records maintenance. Relevant requirements of the Procedure are summarised as follows under the particular headings of the Procedure;

2. Important Considerations
·Any substantiated inappropriate actions or behaviours by an employee in relation to benefits (including but not limited to non-disclosure of receipt, failure to follow documented procedures, or theft of benefits) will result in disciplinary action, up to and including termination of employment.

3. Eligibility
·Non-licensed employees (such as the Applicant) may only accept gifts or gratuities in line with established policies and procedures, and full disclosure is required at all time

4. Tip Allocation – Vote Process
·Employees in each outlet (e.g. Nobu) in the Respondent’s complex are entitled to participate in an annual outlet vote to determine the allocation method of tips in the outlet.
·The outlet vote is conducted over a two-week period during the nominated period.
·After the vote period all employees are required to acknowledge the selected allocation method by signing the Benefits or Gifts, Tips and Gratuities Handling – Outlet Vote Selection Document.

5. Tip Allocation – Method of Distribution
·Eligible employees in each outlet are required to determine a fair and equitable method of distribution of gifts, tips and gratuities.
·The majority outcome of the vote determines the method of distribution of the tips within the venue/outlet.
·To ensure a fair and equitable method is selected during the vote process, the proposed allocation method must be approved by the respective senior manager.
·Clause 5.6 of the Procedure specifies that employees may elect to vote for one of six of the following options;

OPTION ALLOCATION DESCRIPTION

1 Team Building
All tips are to be pooled and used to pay for team building events

2 Individual Tips (a)
All tips are retained by each individual who received these in full.

3 Individual Tips (b)
All tips are retained by each individual who received these less an agreed withheld amount. This withheld amount is then collated and distributed among eligible staff based on hours worked (as per Communal Benefits, below)

4 Communal (Pooled) Tips (a)
All tips are pooled and distributed to all eligible employees based on hours worked and split amongst all employees in the outlet.

5 Communal (Pooled) Tips (b)
All tips are pooled and distributed to all eligible employees based on hours worked and split between working groups on an agreed percentage basis and then to all eligible employees within those working groups

6 Outlet Specific Where eligible employees in a venue or outlet seek to use an alternative method as an exception to the standard.
6. Communication of Tips Handling Procedure
·The Tips Handling Procedure adopted by each venue/outlet must be communicated to all eligible employees and displayed on the appropriate notice boards and recorded on a shared drive.
·The Procedure and/or the currently adopted Tips Handling Procedure refreshers/discussions are to take place in each outlet/venue and all employees are to sign off that they have acknowledged and understood the Tips Handling Procedure.

7. Distribution Procedure
·Tips received by employees from patrons are to be placed in a central location in the venue that must be under CCTV camera coverage.
·All tips are to be handled under CCTV camera coverage at all times.

·All tips received in a venue that has a Communal Tips arrangement in place must be placed in a Tips Box in a designated area that has complete CCTV camera coverage.

·Tips are to be counted in full view of the CCTV camera and if requested by employees, may be counted in the presence of an employee.

·Tips are to be stored in a specific bag, clearly different to a cash bag, or in an appropriate tips receptacle in full view of the CCTV camera.

·All tips are to be distributed to eligible employees in full view of the CCTV camera.

8. Records Maintenance
·Tips counting and distribution is to be recorded and, if required reported appropriately.
·A register of distribution must be maintained in both hard copy with the tips bag/receptacle/box in the venue/outlet and on the shared drive (password protected) to which employees may have view access only.

·Distribution of benefits must be recorded by the responsible person.

·Both the person distributing the tips and each eligible employee must sign the (hard copy) register to acknowledge distribution.

Ms Barnewall states that in 2019 all employees working at Nobu decided that all tips would be pooled and distributed to all eligible employees based on their hours worked. The tips pool is split at the rate of 80% for front of house (FOH) staff and 20% for back of house (BOH) staff. The Applicant was in the BOH group[14].

Ms Barnewall further states that a written circular informing Nobu staff (including the Applicant) of the vote outcome was issued on 19 December 2019 (the 19 December Notice)[15]. She also says that the process was due to go to another vote in December 2020, but this did not occur due to the various lockdowns that had occurred in response to the COVID pandemic in 2020[16]. An unsigned copy of the 19 December Notice states as follows;

“To all Nobu employees
Please be advised that the Nobu tip vote is now complete and will be effective 1 January 2020
This vote is valid for a period of 12 months and revote will be conducted in December 2020.
The majority of employees at Nobu voted for Option 6 of the benefits of gifts, tips and gratuities handling procedure.
Please find below in details the finalised tip procedure for Nobu:
·Nobu FOH including management and EA – Communal tips: 80% of weekly tips received to be pooled and distributed evenly to FOH members based on hours worked. 20% of weekly tips distribution will contribute to Nobu BOH, this will be distributed BOH monthly.
·New FOH salaried and EA employee – Introductory tips rate of 70% for 3 months’ probation period. After 3 months’ probation period, the employee is eligible to receive their tips in full amount.

·Crown Casual Staffing (CCS) and staff assisting from other venue – The rate for staff assisting from CCS or other outlets will be 70% and must work a full service period, either lunch or dinner.”

According to Ms Barnewall, under the process determined by Nobu staff, the tips are usually collected by FOH staff or the Nobu Sushi Bar Chef de Parties who then give the tips to the FOH Supervisors who in turn put the money in the safe. At the end of each month the pool of tips is counted by a supervisor and distributed into the agreed work group portions. Ms Barnewall states that the total pool of tips varies between $7,000 and $12,000 per month and is divided between the eligible staff which consists of approximately 25 BOH staff and 35 FOH staff[17].

The Applicant acknowledged during cross-examination that she was aware of the distribution of tips to staff on a monthly basis in Nobu since her commencement in 2015 but was not aware of the calculation process prior to December 2019 when she was promoted to the Chef de Partie role in which role she was occasionally tasked to calculate and distribute the BOH tips. She stated that she had queried an amount of tips received by her in 2016 but that query was resolved by a supervisor showing her the spreadsheet which confirmed the amount she received.

The Applicant also claims that while working at Nobu she was never informed of any voting or the arrangements regarding the split of tips between FOH and BOH. She further states that she had not seen a copy of the 19 December Notice said by the Respondent to have been issued to Nobu staff. She also states that she has conducted a search of her email records and has been unable to locate a copy of any email sent to her relating to tips distribution arrangements[18]. She did however state that she was aware more recently of a ballot having been conducted in March 2022 on the tips distribution method in Nobu, that being the first occasion a vote has been conducted since the 2019 vote, the delay in the annual vote being because of the COVID pandemic.

The Applicant also states that she was not provided with sufficient training on handling tips. In particular, she says she was not familiar with the tips policy and only dealt with tips as instructed by her managers, one of whom was also dismissed for the alleged stealing of tips. She claims that by her following an incorrect procedure that she says she was trained in by her manager does not constitute misconduct as she believes that she did not take any more tips than she was entitled to[19].

The Applicant says that at the time of her dismissal she understood that the tips procedure in Nobu had the following elements;

tips were not distributed equally among kitchen staff but were instead calculated and distributed based on job levels, with more senior employees receiving proportionately more;
the counting, calculation and distribution of tips was carried out by two management level employees, with no junior employees present;
the actual process involved totalling four weekly transparent plastic bags of tips provided by FOH to BOH for a particular month and inputting that total BOH tips figure along with hours worked by staff for the month into an excel spreadsheet created by the Respondent and maintained on the Nobu office computer;
after calculation of the distribution of the tips the two management level employees would then put the calculated tips amount in bags with eligible employees’ names marked on the bags; and
kitchen staff would sign off on a printed list to acknowledge receipt of their tips when management-level employees distributed the tips.[20]

The Applicant confirmed that when distributing tips to employees, they were not advised of the total amount of tips distributed to BOH staff but were simply provided with their individual amount.
During cross-examination, the Applicant resisted the proposition put to her that she had purposely mishandled tips. She explained that she undertook the calculation and distribution of tips as trained and instructed by the former Chef de Cuisine and the Sous Chef Ray Or. She restated that this involved entering the total value of the BOH tips provided to BOH by FOH supervision for the relevant month and then also entering the staff hours worked during the period into an excel spreadsheet maintained on the Nobu office computer. According to the Applicant, the spreadsheet would then automatically calculate the value of tips for each employee. She confirmed that she undertook the task on three occasions, the last occasion being in December 2021. The Applicant did not accept that she had failed to carry out the task of calculating and distributing tips in accordance with the procedure, which she said she was trained on by Ray Or.

In terms of the records maintained of BOH tips calculation and distribution, the Applicant states that each month, the person doing the tips calculation would copy the previous month’s excel spreadsheet. She believed the previous month’s calculation was kept but no hard copy was retained, and she was unaware of a register being maintained of employees signing off on receipt of their tips. Ms Barnewall subsequently confirmed in her oral evidence that records of prior months distributions were not retained.

The Applicant’s dismissal

Ms Barnewall states that in or about March 2022, a Sous Chef in the Nobu restaurant informed her that the Applicant and two other chefs were allegedly mishandling and taking tips intended for other employees. While not identifying who raised the concern, Ms Barnewall states that the alleged misconduct surfaced when $15 in leftover tips was found in the safe and the employee was told that the leftover amount was kept by the chefs. An investigation was subsequently conducted by Ms Barnewall and Mr Sharland over a two-month period from 14 March – 20 May 2022. During the investigation, three chefs alleged to be involved including the Applicant were interviewed, along with twelve other employees[21].

Mr Sharland states that he became involved in the investigation from 22 March 2022 after allegations were raised that certain employees including the Applicant working at the Nobu restaurant had mishandled tips, insofar as they had not properly distributed the tips in accordance with the Procedure. Mr Sharland expanded on the nature of the misconduct during cross-examination and explained that the suspected misconduct involved a group of BOH supervisors withholding an amount of money from the BOH tips pool each month and distributing it among themselves. This conduct had the effect of fraudulently reducing the tips pool available for distribution to other BOH staff. Mr Sharland went on to say that during the investigation two other chefs at Nobu admitted their liability and in doing so implicated the Applicant in the misconduct. The two other chefs concerned were both dismissed for the misconduct[22].

The Applicant was initially notified by Ms Barnewall of the allegations in a telephone conversation on 4 April 2022, with a meeting scheduled for 7 April 2022. The meeting notification identified that the meeting was to discuss “concerns in relation to allegations of serious misconduct pertaining to the purposeful mishandling and theft of tips.” The Applicant was notified in the meeting request that she was entitled to be accompanied by a support person[23].

The meeting held on 7 April 2022 (7 April Meeting) was attended by Ms Barnewall, Mr Sharland, George Chacko George (the Operations Chef de Cuisine), the Applicant and Daniel Khoo. Mr Khoo, who is an Executive Sou Chef, was invited by the Respondent to attend the meeting as he can speak Mandarin and was able to assist the Applicant in Mandarin/English translation if required. Ms Barnewall states that Mr Khoo translated throughout the meeting and that the Applicant did not object to Mr Khoo attending[24].

Ms Barnewall states that the meeting went for approximately three hours during which the Applicant denied the allegations and in doing so claimed that a Sous Chef at Nobu (Ray Or) taught her the tips procedure and went into great detail about this. According to Ms Barnewall, Mr Or was one of the other two chefs alleged to have stolen tips for which he was ultimately dismissed. At the conclusion of the meeting, the Applicant was advised by Ms Barnewall that she would be contacted later should further relevant information arise through the investigation[25].

Mr Sharland claimed that during the 7 April Meeting, the Applicant was very evasive and that on the one hand she went into great detail about the tips procedure in Nobu but on the other hand attempted to play down her role in distributing the tips. Mr Sharland confirmed that the Applicant claimed that she was just doing what she was taught by another chef[26].

A further meeting, which went for approximately 3.5 hours, was held with the Applicant on 20 May 2022 (the 20 May Meeting) following the Applicant’s return from a period of leave[27]. The Applicant was again invited to bring a support person and she was accompanied at the meeting by Heath Lamaro from the United Workers Union (UWU). The Respondent was represented at the meeting by Ms Barnewall, Mr Sharland and Mr Chacko George again. Mr Khoo also attended the meeting, again in the capacity of providing Mandarin/English translation support[28].

Ms Barnewall states that the allegations were again put to the Applicant that she and two of her colleagues had deliberately mishandled and stolen tips. She further states that the allegations were put in specific terms and remained constant throughout the 20 May Meeting. She also acknowledged that in putting the allegations to the Applicant the non-specific terms of “they said” and “someone said” were used in the meeting as the particular employee who had raised the allegation had sought to remain anonymous. Also, the first-hand statement that the Applicant had provided a cook with an extra $5.00 was also raised in the 20 May Meeting[29] an allegation the Applicant denied.

Ms Barnewall states that notwithstanding the Applicant had previously denied the allegations made against her, she admitted during the 20 May Meeting to having engaged in the conduct and later acknowledged that her actions were wrong and were not consistent with the Respondent’s expected standards of core values, especially acting with integrity[30]. Ms Barnewall further states that the Applicant admitted that she understood the tips process and how it operated at Nobu. To confirm the Applicant’s admissions, Ms Barnewall says she summarised what the Applicant had said and then asked her words to the effect “is that what you have admitted to?” to which she says the Applicant responded “Yes.” While not included in her witness statement, Ms Barnewall also claimed during cross examination that the Applicant admitted to putting incorrect amounts in the excel spreadsheet when inputting figures.

Mr Sharland supported Ms Barnewall’s evidence and states that the Applicant confirmed her understanding of the Nobu tips distribution arrangements although in cross-examination he was unable to recall the exact words of the claimed misconduct admission made by the Applicant, that is whether the Applicant’s response was a simple “yes” to a question from Ms Barnewall or whether her response was a more detailed admission. Nor could Mr Sharland recall whether the Applicant’s admissions were made in English or stated by her in Mandarin than translated into English by Mr Khoo.

The Applicant rejects that she displayed a good knowledge of the Procedure and the tips arrangements in place at Nobu. She also states that the Nobu tips arrangements she described in both meetings was considered by the Respondent to be incorrect, which she says cannot be reconciled with the Respondent’s claim that she displayed a good knowledge of the tips arrangements[31]. The Applicant also states that she did not know that Ms Barnewall had, during the 20 May Meeting asked her whether she understood the allegations and whether she admitted to them. She states that she understood the relevant question as translated by Mr Khoo to have been whether she thought everything she had said was correct (or words to that effect), to which she responded “yes.”[32] She steadfastly rejected that she had knowingly admitted the misconduct.

Ms Barnewall in her evidence also points to statements made by the Applicant during the meetings which she says the Applicant subsequently contradicted. The contradicted statements were said to include the following;

they had “never handled or distributed tips”;
that a Manager “had never taught” the Applicant “how to count or distribute tips”; and
that she had not counted or distributed tips with other chefs despite several other chefs having seen her do so.[33]

Based on the outcome of the investigation, Ms Barnewall says that it was concluded that the Applicant had engaged in serious misconduct and that the Respondent had lost trust and confidence in the Applicant’s ability to continue to perform her supervisory role as Chef de Partie at Nobu. The decision to terminate the Applicant was, according to Ms Barnewall, taken only after considering all the circumstances and also taking into account the Applicant’s admissions during the meeting[34].

During cross examination, Mr Barnewall stated that the decision to dismiss the Applicant was based on her admissions of misconduct made in both English and Mandarin at the 20 May Meeting and on the balance of probabilities. When pressed in cross-examination, Ms Barnewall made several concessions regarding the evidentiary basis supporting the Applicant’s dismissal;

no formal record of the two meetings held with the Applicant were made, and while Ms Barnewall stated that she had made some handwritten notes, she acknowledged those notes were not in evidence before the Commission;
there was no record available that confirmed whether the Applicant had received and/or been trained in the Policy and/or Procedure;
there was no record of the communication of the outcome 2019 Nobu staff tips procedure vote other than an unsigned and undated copy of the December 2019 Notice;
there was no evidence available of whether a signed and dated copy of the December 2019 Notice had in fact been placed on the Nobu notice board and by whom;
there were no records available of employees in Nobu having signed off and acknowledged the Nobu outlet vote in December 2019 as required by clause 4.4 of the Procedure;
there were no records available of any training or refresher training of Nobu staff having been undertaken in the Policy and/or Procedure as required by clause 6.4 of the Procedure;
there were no records available that established which months the Applicant had participated in the Nobu BOH tips calculation and distribution process;
no records were available of monthly tips calculation and distribution to Nobu BOH staff as required by clauses 8.1 and 8.2 of the Procedure;
while acknowledging the existence of the tips calculation excel spreadsheet referred to by the Applicant, that spreadsheet was not produced in evidence before the Commission for reasons that could not be explained;
there was no evidence that established in which month and to what value of tips had been purposely mishandled by the Applicant;
no direct evidence other than the alleged misconduct admissions of the Applicant was available to Commission; and
Ms Barnewall accepted that the general nature of the allegations put to the Applicant during the Respondent’s investigation was explained by the lack of specific evidence of the alleged misconduct.

Mr Sharland gave evidence that he has been in his role of Investigator with the Respondent for over 20 years, that he investigates all matters for the Casino that involve a potential criminal offence and routinely provides support to law enforcement agencies. In the present matter he says he primarily provided support to Ms Barnewall in the conduct of the interviews held with the Applicant and other employees. He was cross-examined on the conduct and outcome of the investigation and relevantly stated that;

his role in the investigation was confined to supporting the interviews of employees;
while claiming knowledge of the Procedure and the tips distribution arrangement in place in Nobu, he was uncertain as to whether the counting of tips required one or two supervisory staff to be present;
he believed that the alleged misconduct could have been occurring for up to two years, but readily accepted that there was no direct evidence by way of records;
the investigation of the alleged misconduct focussed on up to six BOH staff but there was insufficient evidence to proceed with action against three of those staff who were suspected of participating in the misconduct;
he accepted that the Respondent could not be certain which months the Applicant was involved in the counting and distribution of tips;
while confirming that two other chefs had implicated the Applicant during the investigation, he acknowledged that those former employees, who were dismissed for their part in the misconduct, were not called to give evidence in this proceeding;
aside from the statements made during the investigation by the two chefs who were dismissed for their part in the misconduct, none of the other employees who were interviewed during the investigation were able to provide direct evidence of the alleged misconduct of the Applicant;

acknowledged that he had made no formal record of the interviews or meetings conducted with employees as part of the investigation, and while he referred to having made some notes, agreed that those notes were not in evidence before the Commission; and
confirmed that no CCTV footage was available as it had expired before the alleged misconduct of the Applicant was drawn to the Respondent’s attention.

Ms Barnewall states that at the point where the decision to terminate the Applicant was communicated to her, the Applicant then raised the claim that Mr Khoo’s Mandarin speaking competence was not up to the required standard. Ms Barnewall further states that it had been made clear to the Applicant that she could arrange an interpreter of her own choice at any point if she wished to do so but did not[35].

The Applicant claims that she did not know Mr Khoo before the meetings with the Respondent but did not object to him interpreting for her because he was arranged by the Respondent, and she says she felt the Respondent would arrange a suitable interpreter. She further states that while she attempted to express herself as best she could in the first meeting, she realised at the second meeting that it was more serious so she spoke mainly in Mandarin and relied on Mr Khoo to translate as she felt her poor English would put her at a disadvantage. Ms Barnewall confirmed that the Applicant spoke more in English at the 7 April Meeting and relied less on translation in that meeting although Mr Khoo’s recollection was that the Applicant’s reliance on his translation assistance was similar in both meetings.

The Applicant further states that she believes that Mr Khoo’s proficiency in Mandarin was inadequate given the brief translations he made of some lengthy discussion in the second meeting and that during a break in the meeting he needed the assistance of a translation app on his phone. Based on these concerns she believes Mr Khoo failed to translate for her fully and completely during the second meeting[36].

Mr Khoo gave evidence that he is an Executive Sous Chef with the Respondent and that he was born in Singapore and migrated to Australia in 2001. While acknowledging that he is not a professional interpreter and that Mandarin is not his first language, he says his family is ethnic Chinese and that he learned Mandarin at school in Singapore, as along with English it was one of the two main languages taught in school in Singapore. He confirmed that he was asked by Ms Barnewall to attend both disciplinary meetings held with the Applicant on 7 April and 20 May 2022 for the purpose of providing English/Mandarin translation support for the Applicant but was not otherwise involved in the investigation of the alleged misconduct. He also says that he had on an occasional basis acted as an interpreter for the purpose of assisting other employees of the Respondent with translation[37]. While agreeing during cross-examination that he had used a translation app on his phone on a couple of occasions to assist him translate some words he was unfamiliar with during the 20 May Meeting, Mr Khoo insisted that his Mandarin/English translation skills were “quite OK”.

Mr Khoo also states that he asked the Applicant in each of the two disciplinary meetings whether she was happy for him to attend and translate as required, to which questions he says she responded “yes” on both occasions. He says that during both meetings which went for 3 hours and 3.5 hours respectively, he translated some but not every comment or statement, as requested by the Applicant or other attendees. He further states that during the meetings the Applicant did not raise any concerns regarding his translation competence until towards the end of the second meeting when Ms Barnewall informed the Applicant that the Respondent was considering the termination of her employment. He says it was at this point that the Applicant claimed his translation competence was not up to the required standard[38].

In relation to the misconduct admissions claimed to have been made by the Applicant at the 20 May 2022 meeting, Mr Khoo could not recall the exact question/s posed to the Applicant by Ms Barnewall or the Applicant’s response but was confident that he would have translated the conversation word for word. While also unable to confirm the exact admissions made by the Applicant, Mr Khoo also stated that the admissions were made in both Mandarin and English.

Ms Barnewall states that following the Applicant’s admissions, the Respondent’s meeting attendees then took a 10-minute break to consider the situation[39]. In cross-examination Ms Barnewall says that a telephone call was also made during this break to the Respondent’s General Manager Food and Beverages to confirm the proposed decision of termination of the Applicant’s employment. On resumption of the meeting the Applicant was advised of the Respondent’s decision to terminate her employment, at which point the Applicant requested a break to speak with her representative following which she requested through her representative to be allowed to resign instead of being subject to dismissal. The Respondent agreed but requested that such resignation be put in writing. Ms Barnewall insists that the decision to resign was not sought or requested by the Respondent and was at the Applicant’s initiative. The Applicant sent an email to Ms Barnewall at 6.29pm on 20 May 2022 to the following effect;

“Hi Carlie
I Lai Yu would like to formally resign from my position as CDP at Nobu effective today 20/05/2022. As part of my resignation I ask that the company pay me 4 weeks in lieu of notice, and provide me with a letter of service inclusive of a detailed description of my role, responsibilities, duties and skills at Nobu.
Regards
Lai Yu”[40]

At 6.30pm on 20 May 2022, Ms Barnewall responded to the Applicant’s notice of resignation and stated that the Respondent accepted the resignation including the terms proposed by the Applicant. At 8.07pm later that evening the Applicant sent two further emails to Ms Barnewall in which she withdrew her earlier resignation. The emails sent to Ms Barnewall were in the following terms;

“I withdraw my resignation application.
You guys said that I must submit my resignation report today, otherwise I will leave a bad record in my file, which makes me feel deeply threatened and coerced, I will not resign, I did nothing wrong. I have been treated unfairly”
“I have done nothing wrong, I have reported to my superiors before, I have done what I am supposed to do.
I don’t think it’s fair that you’re firing me and threatening me with a bad job record on Friday night!”[41]

Following the Applicant’s withdrawal of her resignation, Ms Barnewall confirmed the Applicant’s termination of employment in an email sent at 5.06 pm on 22 May 2022[42]. The Applicant was summarily dismissed and did not receive pay in lieu of notice.

Covert audio recordings

During these proceedings, the Applicant filed recordings and the transcript of conversations held by her with Mr Lamaro of the United Workers Union, with Ms Barnewall and Mr Lamaro and a further conversation between herself and the former Chef de Cuisine. The Applicant agreed that each of the recordings was made without the knowledge or consent of any of the other parties. It appeared from the material that the conversations involving Mr Lamaro and Ms Barnewall took place towards and/or at the end of the 20 May Meeting while the conversation with the former Chef de Cuisine took place sometime after the Applicant’s dismissal.

The Applicant sought to justify her conduct by claiming that the recordings were not made during either the 7 April Meeting or 20 May Meeting. She further states that she became concerned at the disciplinary outcome at the end of the 20 May Meeting and recorded the conversations to try and protect herself.

The Applicant pressed for the admittance of the recordings while the Respondent opposed the Commission accepting the recordings into evidence. I declined to accept the recordings into evidence for the simple reason that the recordings were not probative to the matters I am required to determine.

The first two recordings bore upon the Applicant’s contention that she had been coerced or pressured to resign at the 20 May Meeting. The recordings may have been probative had there been a dispute about whether the Applicant resigned freely or whether she was forced to resign due to the conduct or a course of conduct engaged in by the Respondent. However, as set out above, the Applicant withdrew her resignation on the evening of 20 May 2022 following which the Respondent proceeded to confirm the termination of her employment on 22 May 2022. There is no dispute that the Applicant was dismissed at the initiative of the Respondent, rendering the first and second recordings otiose.

As regards the third recording, that being of the conversation between the Applicant and the former Chef de Cuisine, that former employee was not called to give evidence and was not able to be cross-examined in relation to statements made during the recorded conversation with the Applicant. In these circumstances the unauthorised recording has no probative value in my view.

Has the Applicant been dismissed?

A threshold issue to determine is whether the Applicant has been dismissed from her employment. Section 386(1) of the Act provides that the Applicant has been dismissed if:

(a) the Applicant’s employment with the Respondent has been terminated on the Respondent’s initiative; or

(b) the Applicant has resigned from their employment but was forced to do so because of conduct, or a course of conduct, engaged in by the Respondent.

Section 386(2) of the Act sets out circumstances where an employee has not been dismissed, none of which are presently relevant. There was no dispute and I find that the Applicant’s employment with the Respondent terminated at the initiative of the Respondent.

Initial matters

Under section 396 of the Act, the Commission is obliged to decide the following matters before considering the merits of the application:

(a) whether the application was made within the period required in subsection 394(2);

(b) whether the person was protected from unfair dismissal;

(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code; and

(d) whether the dismissal was a case of genuine redundancy.

Relevant to the determination of the preliminary matters I am satisfied that;

· the Applicant was dismissed on 20 May 2022 and filed her unfair dismissal application on 8 June 2022, that latter date being within 21 days of the date of her dismissal;

· at the time of the Applicant’s dismissal the Respondent employed approximately 10,000 employees and is therefore not a small business employer within the meaning of s.23 of the Act;

· the Applicant commenced employment with the Respondent on 14 December 2015 and at the time of her dismissal had been employed for a period of over 6 years, that period being in excess of the minimum employment period of 6 months;

· the Applicant was covered in her employment by the Hospitality Industry (General) Award 2010 and was in receipt of an annual base salary of $80,606.97 plus superannuation at the time of her dismissal; and

· the Applicant was not dismissed due to the Respondent no longer requiring the Applicant’s job to be performed by anyone because of changes in the operational requirements of the Respondent’s enterprise.

Having considered each of the initial matters, I am satisfied that the application was made within the required period in subsection 394(2), the Applicant was a person protected from unfair dismissal, the small business fair dismissal code does not apply, and the dismissal was not a genuine redundancy. I am now required to consider the merits of the application.

Was the dismissal harsh, unjust, or unreasonable?

Section 387 of the Act provides that, in considering whether it is satisfied that a dismissal was harsh, unjust, or unreasonable, the Commission must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person – whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.

Was there a valid reason for the dismissal related to the Applicant’s capacity or conduct – s.387(a)?

In order to be a valid reason, the reason for the dismissal should be “sound, defensible or well founded”[43] and should not be “capricious, fanciful, spiteful or prejudiced[44].” However, the Commission will not stand in the shoes of the employer and determine what the Commission would do if it were in the position of the employer[45]. The question the Commission must address is whether there was a valid reason for the dismissal related to the employee’s capacity or conduct (including its effect on the safety and welfare of other employees).[46]

In cases relating to alleged misconduct, the Commission must make a finding, on the evidence provided, whether, on the balance of probabilities, the conduct occurred.[47] It is not enough for an employer to establish that it had a reasonable belief that the termination was for a valid reason.[48]

The employer bears the evidentiary onus of proving that the conduct on which it relies took place.[49] In cases such as the present where a serious allegation of theft is made, the Briginshaw standard applies so that any findings, if made, of the misconduct alleged are not made lightly;

“The standard of proof remains the balance of probabilities but 'the nature of the issue necessarily affects the process by which reasonable satisfaction is attained' and such satisfaction 'should not be produced by inexact proofs, indefinite testimony, or indirect inferences' or 'by slender and exiguous proofs or circumstances pointing with a wavering finger to an affirmative conclusion.”[50]

There are two matters going to valid reason that require consideration, the first being the alleged theft of tips money by the Applicant and the second matter being the covert audio recording of conversations made by the Applicant without the knowledge or consent of other persons including Ms Barnewall. I turn firstly to the alleged theft of tips money.

Alleged theft of tips

The Respondent submits that there was a valid reason for the Applicant’s dismissal related to her conduct, that being she had stolen tip money that ought to have been distributed to other employees. The conduct was, according to the Respondent, in breach of the Respondent’s Code of Conduct, the Policy and the Procedure. The specific reasons for the Applicant’s dismissal were set out in the Termination Letter in the following relevant terms;

“Dear Elaine
Termination of Employment for Serious Misconduct
…………..
………You are therefore advised that following an investigation conducted into your conduct and the allegations made against you being proved, that your employment as a Chef de Partie at Crown has been summarily terminated on the basis of serious misconduct, effective immediately from 20 May 2022. The termination of your employment followed the allegations made against you regarding issues of integrity (including you providing a series of mistruths through earlier enquiries regarding this matter) and theft of tips from your colleagues. Crown reached this decision after having regard to all the circumstances of this matter including considering your subsequent admissions to the serious allegations put to you, your explanation given, and your continued dishonesty throughout the investigation process. Your actions were found to be in breach of Crown’s Code of Conduct and Crown’s Tips, Gifts and Gratuities Policy.
……………”[51]

There is no contest as to the existence and operation of the Policy and Procedure or that the December 2019 Notice reflected the agreed arrangements for the distribution of tips within Nobu, that being that tips collected by FOH staff are tallied and split on an 80:20 basis between FOH and BOH and then within each of the FOH and BOH workgroups, the tips pools are then allocated based on hours worked. What is particularly at issue is whether the Applicant, in calculating and distributing tips to BOH staff along with other senior chefs as she was occasionally required to, was aware of and applied the Procedure in accordance with the tips distribution arrangements voted on by Nobu staff.

The Respondent submits that its supervisory staff are entrusted with responsibility to be aware of and implement the Respondent’s policies and procedures. In the present case, it says the Applicant was in a supervisory position and that she, along with two other (now former) employees, breached the trust placed in them by misappropriating tips that ought to have been distributed to other Nobu BOH staff in accordance with the Procedure and the vote outcome reflected in the December 2019 Notice. The Respondent further states that the decision to dismiss the Applicant followed a detailed investigation during which over twelve staff members were interviewed, two of whom implicated the Applicant and who were also dismissed for their part in the misconduct. The Respondent also relies on the admissions alleged to have been made by the Applicant in the 20 May Meeting and her alleged dishonesty during the investigation.

While I accept that the Applicant ought to have been familiar with and faithfully applied the Respondent’s Policies and Procedures, there is no evidence of the Applicant having been provided copies of or with any training in respect of the Policy and Procedure. Moreover, on promotion to a supervisory role with Nobu, at which point she was liable to be delegated to calculate and distribute tips in accordance with the Procedure, there is no evidence that she received any instruction or training in the Procedure beyond that provided by the Sous Chef to whom she reported for a period following the Chef de Cuisine’s resignation. Nor was there any evidence of any refresher training on the Policy and Procedure having been provided to staff in the Nobu venue as required by clause 6.4 of the Procedure.

Turning to the tips distribution process agreed to by employees in the Nobu outlet in 2019, the Respondent was unable to adduce evidence that supported its claim that the outcome of the 2019 staff vote on the Nobu tips distribution process as reflected in the unsigned December 2019 Notice, was in fact communicated to employees as required by the Procedure. Clause 6.2 of the Procedure requires the communication of the outcome to staff and display of the outcome on the relevant notice board. The posting of the December 2019 Notice if it did occur, which was not established to my satisfaction on the evidence, would in any case not substitute or displace the separate requirement that the Tips Handling Procedure adopted by the venue be communicated to staff. No evidence was led that established any such communication had occurred. Nor was there evidence that the Applicant, or any other employee for that matter, signed off on and acknowledged the 2019 vote in the Benefits, Tips and Gratuities Handling – Outlet Vote Selection Document as required by clause 4.4 of the Procedure. While it was uncontroversial that the employees voted for the distribution of Nobu tips on an 80:20 split between FOH and BOH then based on hours worked, there was no evidence that the Applicant participated in the vote or received notice of the outcome.

Turning to the alleged theft of tips on the part of the Applicant, the substance of the allegation was that the Applicant and other senior chefs kept a portion of the tips pool before distributing the tips to BOH staff. Significantly, the Respondent’s witnesses were unable to state with any certainty on how many occasions the Applicant had undertaken the task of calculating and distributing BOH tips. Ms Barnewall confirmed that it was not possible to identify which BOH supervisor had undertaken the tips calculation and distribution task in a particular month and had no basis to challenge the Applicant’s evidence that she had undertaken the task on only three occasions, the most recent occasion being in December 2021.

Particularly troubling was the fact that there were no records available to establish the total tips pool received by the Nobu venue in each period and the respective amounts available for distribution between FOH and BOH staff. Nor were there any records of the total tips pool available for BOH staff distribution or the individual amounts distributed to employees monthly. In the absence of any records, it was simply not possible to identify if, when and what value of tips had been stolen or received for that matter. The absence of any records was despite the clear requirement in section 8 of the Procedure that records be maintained. An absence of any apparent controls being in place in circumstances where upwards of several thousand dollars in tips are received by the Nobu venue each month reflects poorly on both the Respondent and those in supervisory/management roles in the venue.

Turning to the information provided and admissions made during the Respondent’s investigation by the two other employees who were dismissed for misconduct, there was no probative evidence before me going to the actual statements said to have been made by those former employees that implicated the Applicant in the alleged theft of the tips. Unsurprisingly, those two former employees who were also dismissed for their part in the alleged misconduct were not called to give evidence. Tellingly however, there was no record of interviews/meetings or signed statements obtained from those two employees through the course of the Respondent’s investigation that would shed light on the exact nature of the statements said to have implicated the Applicant.

Furthermore, no other employees interviewed by the Respondent during its investigation were able to say they had witnessed the Applicant misappropriating tips that ought to have been otherwise distributed to BOH staff. That lack of direct evidence was acknowledged by Mr Sharland. It appears the evidence from those other employees that emerged during the Respondent’s investigation established no more than the Applicant had participated in the counting and distribution of the tips for BOH staff on a few occasions, a point not contested in these proceedings by the Applicant.

Turning now to the investigation conducted by the Respondent. Mr Sharland gave evidence that he has been in his role of Investigator with the Respondent for over 20 years, that he investigates all matters for the Casino that involve a potential criminal offence and routinely provides support to law enforcement agencies. In the present matter he says he primarily provided support to Ms Barnewall in the conduct of the interviews held with the Applicant and other employees. It is surprising in these circumstances, given the Respondent’s size and the availability of experienced internal resources, that the Respondent was unable to produce an investigation report, a single witness statement obtained during the internal investigation or any meeting/interview records or notes.

It follows from the above that there is no direct witness evidence before me going to the alleged theft of Nobu BOH tips money by the Applicant. The Respondent’s case appears to rest almost entirely on the Applicant’s alleged admissions of misconduct made in the 20 May Meeting and her alleged dishonesty during the investigation. It is to those matters I now turn.

Ms Barnewall gave evidence that the Applicant made admissions of engaging in misconduct, in both English and Mandarin. Mr Sharland supported that evidence although when pressed during cross-examination he could not recall the exact words used by either Ms Barnewall or the Applicant. Further, he was unable say whether the Applicant’s admissions were made by way of a detailed response or a simple “yes” to a question posed by Ms Barnewall. Nor could he recall whether the admissions were made in English or Mandarin. Mr Khoo’s recollection of the alleged admissions was similarly vague. While also stating that the Applicant had made admissions of misconduct and that he had faithfully translated word for word both the questions from Ms Barnewall and the Applicant’s responses, he could not recall the specifics of any admissions made by the Applicant.

While I did not find Ms Barnewall to be an unconvincing witness generally in light of her willingness to make appropriate concessions during cross-examination, I did find her evidence on the admissions of the Applicant in the 20 May Meeting to be unsatisfactory. That is because she did not provide a detailed account of the exchange between herself and the Applicant that set out the specific questions asked and specific responses provided by the Applicant, be that in English or as translated into English by Mr Khoo. It is the case that the evidence of both Mr Sharland and Ms Barnewall would be far more compelling in the circumstances of this case, where the Applicant was supported in a critical meeting by translation assistance, if contemporaneous meeting minutes or notes had been taken and provided in evidence to these proceedings. That such meeting notes or minutes were not taken or available in these proceedings causes me to approach with caution the evidence of the Applicant’s alleged admissions in the 20 May Meeting.

For her part, the Applicant, was steadfast and credible during cross-examination in her denials of having made misconduct admissions in the 20 May Meeting. She restated in cross-examination that she did not knowingly make admissions of misconduct and attributed any alleged admissions to inaccurate translation on the part of Mr Khoo and her consequent misunderstanding of the questions posed by Ms Barnewall. Mr Khoo is not a professional translator; Mandarin is not his first language and while stating his Mandarin skills are “quite OK” he did concede that he had used a translation app on his phone on a couple of occasions during the 20 May Meeting.

In all the above circumstances and having regard to Mr Sharland and Mr Khoo’s lack or recollection of specific admissions, I am not satisfied that the Applicant clearly understood the questions posed by Ms Barnewall as translated by Mr Khoo. I also note that the alleged admissions occurred after 6.00pm in the evening and at the end of a 3.5-hour meeting in which circumstances it would be understandable, if not inevitable, that levels of concentration may have waned.

Turning now to the alleged dishonesty of the Applicant during the investigation, it is stated by Ms Barnewall that the Applicant made various statements during the two meetings that she subsequently contradicted. The statements that were said to have been made and subsequently contradicted by the Applicant included that she was unfamiliar with the Procedure, that she had not been involved in the counting of the tips, that she had not been taught by a manager on how to count and distribute the tips or that she had not put leftover tips money into her own tips or that of the peers. Mr Sharland also claims that the Applicant was attempting to avoid questions in the first meeting, a point strongly refuted by the Applicant.

For the same reasons that I approach the alleged admissions made by the Applicant at the 20 May Meeting with caution I also approach the alleged inconsistencies in the Applicant’s responses with similar caution. The absence of a detailed record of either meeting, including the specific questions posed to the Applicant and her responses is problematic in circumstances where the Applicant does not speak English as a first language and was consequently provided with Mandarin/English translation support for both meetings. I particularly note the Applicant’s evidence, with which Ms Barnewall agreed, that the Applicant relied more on her English speaking in the first meeting. However, in the second meeting she relied more on the translation assistance of Mr Khoo, that decision of the Applicant motivated she says by her concern that her English skills put her at a disadvantage. This point was not challenged by the Respondent.

Notwithstanding the reservations I hold regarding the comprehension challenges the Applicant may have/confronted in responding to Ms Barnewall’s questions and the absence of a detailed record of the two meetings which went for a total of 6.5 hours, I am able to accept on the evidence of Ms Barnewall that the Applicant’s responses to questions during the two meetings were not consistent and unwavering. What is less clear however is whether the inconsistency in the Applicant’s responses were due to factors such as anxiety, inaccurate comprehension or miscommunication on her part as opposed to a deliberate strategy to mislead the Respondent to avoid the consequences of her conduct. A conclusion that the Applicant deliberately withheld information or sought to mislead the Respondent during the investigation would tell in favour of a finding that the Applicant was engaged in the theft of tips, though not decisively in my view given the absence of any supportive direct evidence. In any case I am not satisfied on the material before me that the Applicant’s inconsistent responses provided during her two interviews was a conscious strategy to obfuscate and mislead the Respondent in its investigation.

Despite the Respondent expressing great confidence in its closing submissions of its belief that the Applicant had stolen tips, it has failed to support that claim with any direct evidence of the misconduct, beyond unconvincing evidence going to the admissions said to have been made by the Applicant in the 20 May Meeting and her alleged dishonesty during the investigation. The Respondent’s case is characterised by a singular lack of direct evidence, by its own failures in the implementation of the Policy and Procedure in the Nobu venue and by weaknesses in its investigation. While I am satisfied that the Applicant’s responses during the investigation meetings may have been inconsistent, that evidence on its own is not sufficient to satisfy me to the requisite standard set out in Briginshaw that the Applicant engaged in theft in the counting and distribution of tips to Nobu BOH staff.

Covert audio recordings

As set above in the evidence, the Applicant acknowledged that she had made a few audio recordings of conversations with various persons without their knowledge or agreement. This included a conversation following the end of the 20 May Meeting involving Mr Lamaro and Ms Barnewall. The Applicant attempted to justify the recordings on the basis that they were not made during the 7 April Meeting or 20 May Meeting and that she was attempting to protect herself in circumstances where she had been advised that her employment was to be terminated.

I agree with the comments of Deputy President Colman in Roman v Mercy Hospital[52] (Roman) where he described such conduct in the absence of justification as highly inappropriate irrespective of whether it constitutes an offence in the relevant jurisdiction[53]. The Deputy President also found in the circumstances of that case that the applicant’s conduct of covertly recording a meeting established a further valid reason for dismissal. Those comments and the findings of the Deputy President do not however stand for the proposition that the covert recording of conversations or meetings by an employee will establish a valid reason for dismissal in all circumstances. It of course remains necessary to consider the circumstances in which the conduct occurred.

In the present case, the Applicant recorded two conversations at the end of the 20 May Meeting, those being between herself and Mr Lamaro and then a further conversation involving herself, Mr Lamaro and Ms Barnewall. Neither Ms Barnewall nor Mr Lamaro consented to the recording of these conversations. It is worth noting that the recording of these conversations occurred in the immediate wake of the Applicant having been told in the 20 May Meeting that her employment was to be terminated. It was in that context that the Applicant was discussing the option of resignation, firstly with Mr Lamaro and then with Ms Barnewall, as a means of softening the blow of dismissal.

At the time of recording the conversations, the Applicant technically remained an employee of the Respondent as she did not receive notice of termination until 22 May 2022, however any opportunity to influence the decision to terminate her employment had passed. All that remained for the Applicant to decide was whether she wished to resign or be dismissed as just advised to her by Ms Barnewall at the conclusion of the 20 May Meeting. The timing and context in which the recordings were made is a relevant factor. The conduct of the Applicant in the present case while deserving of criticism, does not in my view rise to the level of ‘reprehensible’ conduct considered by Deputy President Clancy in Scale v Coles Supermarket Australia Pty Ltd[54] (Scale) where an employee proceeded to record a meeting despite specific warnings from the employer not to do so, where she had a support person present and where the meeting had been preceded by a show cause letter. I also note the language barriers confronted by the Applicant in the present case.

The Applicant’s conduct in recording her conversation with Ms Barnewall without Ms Barnewall’s knowledge or consent was inappropriate notwithstanding such conduct is not illegal in Victoria. It should not have occurred in circumstances where the Applicant was being supported by Mr Lamaro. Balanced against these considerations is the fact that the Applicant did not record the 7 April Meeting and 20 May Meeting, which indicates to me that the Applicant had not engaged in a pre-meditated course of action. It was only after the termination decision had been communicated to her at the end of the 20 May Meeting that she recorded the two post meeting conversations on 20 May 2022. While the content of the audio recordings of those two conversations was not probative to the matters before me and were consequently not accepted into evidence, the actions of the Applicant nonetheless constituted misconduct.

It is open for the Commission to consider conduct of a dismissed employee that was not known to the employer at the time of the dismissal in determining whether there was a valid reason for dismissal. The conduct of the Applicant in the present matter was not known to the Respondent at the time of dismissal and only became known when the Applicant filed her material in these proceedings. In assessing the gravity of the misconduct, I have taken into account the timing and circumstances in which the recording was made, the fact that English is not the Applicant’s first language and that the decision to dismiss the Applicant had already been communicated to her. While constituting misconduct I am not satisfied that it rises to a level that would establish a valid reason for her dismissal in the particular circumstances of this case.

I have dealt with the two grounds of misconduct relied on by the Respondent but am not satisfied that a valid reason for the Applicant’s dismissal has been established. This weighs strongly in favour of a finding that the dismissal was unfair.

Notification of the valid reason – s.387(b)

Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made to terminate their employment,^{^[55]} and in explicit[56], plain and clear terms[57].

Absent a valid reason for dismissal the Respondent was unable to comply with the requirement to notify the Applicant of a valid reason for her dismissal. As I am not satisfied that there was a valid reason related to dismissal, this factor is not relevant to the present circumstances.[58]

Opportunity to respond to any reason related to capacity or conduct – s.387(c)

An employee protected from unfair dismissal should be provided with an opportunity to respond to any reason for their dismissal relating to their conduct or capacity. An opportunity to respond is to be provided before a decision is taken to terminate the employee’s employment.[59]

The opportunity to respond does not require formality and the factor is to be applied in a common-sense way to ensure the employee is treated fairly.[60] Where the employee is aware of the precise nature of the employer’s concern about his or her conduct or performance and has a full opportunity to respond to the concern, this is enough to satisfy the requirements.[61]

As I have not found that there was a valid reason related to dismissal, this factor is not relevant to the present circumstances.[62]

Support person – s.387(d)

Where an employee protected from unfair dismissal has requested a support person be present to assist in discussions relating to the dismissal, an employer should not unreasonably refuse that person being present.

There is no positive obligation on an employer to offer an employee the opportunity to have a support person:

“This factor will only be a relevant consideration when an employee asks to have a support person present in a discussion relating to dismissal and the employer unreasonably refuses. It does not impose a positive obligation on employers to offer an employee the opportunity to have a support person present when they are considering dismissing them.”[63]

I am satisfied that the Applicant was afforded an opportunity to be accompanied by a support person in each discussion held in relation to the investigation of the alleged misconduct and in respect to her dismissal. This included Mr Lamaro accompanying the Applicant at the 20 May Meeting. These circumstances weigh in favour of a finding that the dismissal was not unfair.

Warnings regarding unsatisfactory performance – s.387(e)

The dismissal did not relate to unsatisfactory performance. This factor is therefore not relevant in the circumstances.

Impact of the size of the Respondent on procedures followed – s.387(f)

The evidence of Ms Barnewall indicates that at the time of the Applicant’s dismissal the Respondent employed approximately 10,000 employees. There is no evidence before me, and nor did either party contend, that the Respondent organisation’s size impacted on the procedures followed by it in dismissing the Applicant. This factor weighs neutrally in my consideration.

Impact of absence of dedicated human resources management specialist/expertise on procedures followed – s.387(g)

The evidence in this matter indicates that the Respondent had access to the services of an in-house human resources specialist. This factor weighs neutrally in my consideration.

Other relevant matters – s.387(h)

Other matters raised by the Applicant said to render the dismissal unfair are that of her limited English language ability and her belief the Respondent may have dismissed her to avoid a long service leave liability that would have arisen within six months had she not been dismissed.

The claim in relation to her long service leave was not expanded on in the proceedings by the Applicant beyond expressing a belief that it was a motivating factor in her dismissal. There was no evidence to support that belief beyond the circumstantial fact that at the time of her dismissal she had been employed by the Respondent for 6.5 years and would have been entitled to long service leave after seven years’ service.

While the Applicant may harbour a suspicion, there is absolutely no evidence before me to suggest the Respondent’s decision to dismiss the Applicant was motivated by a desire to avoid a long service leave liability that would have fallen due at the end of 2022. It is difficult to conceive that an employer with approximately 10,000 employees on one site would seek to avoid a long service liability of several weeks' pay by dismissing the Applicant and by doing so exposing itself to a risk of a reinstatement and/or compensation order to an even greater amount than the avoided long service leave liability. I place no weight on the long service leave allegation raised by the Applicant.

Turning to the Applicant’s English language limitations. That is a relevant factor that I have already taken into account when considering the other s.387 criteria. It is therefore unnecessary for me to place further weight on this factor.

Is the Commission satisfied that the dismissal of the Applicant was harsh, unjust, or unreasonable?

I have made findings in relation to each matter specified in s.387 of the Act as relevant. I must consider and give due weight to each as a fundamental element in determining whether the termination was harsh, unjust, or unreasonable.[64]

I have found that the Applicant’s dismissal was not supported by a valid reason. This strongly weighs against a finding that the dismissal was not unfair. Aside from being afforded an opportunity to be accompanied by a support person in each of the disciplinary meetings, all other criteria were either not relevant or weighed neutrally in my consideration. Having considered each of the matters specified in s.387 of the Act and having particular regard to the absence of a valid reason, I am satisfied that the dismissal was unjust, unreasonable, and thereby unfair.

Remedy

Being satisfied that the Applicant:

(i)made an application for an order granting a remedy under s.394;
(ii)was a person protected from unfair dismissal; and
(iii)was unfairly dismissed within the meaning of s.385 of the Act,

I may, subject to the Act, order the Applicant’s reinstatement, or the payment of compensation to the Applicant.

Under s.390(3) of the Act, I must not order the payment of compensation to the Applicant unless:

(a)I am satisfied that reinstatement of the Applicant is inappropriate; and
(b)I consider an order for payment of compensation is appropriate in all the circumstances of the case.

Is reinstatement of the Applicant inappropriate?

The Applicant submitted that reinstatement was not appropriate in the circumstances as she felt her relationship with and trust in the Respondent had been irrevocably damaged by the circumstances and manner of her dismissal. The Respondent agreed that reinstatement would be inappropriate in circumstances where the Applicant felt uncomfortable about returning to its employ.

Having regard to the matters referred to above, I consider that reinstatement is inappropriate. I will now consider whether a payment for compensation is appropriate in all the circumstances.

Is an order for payment of compensation appropriate in all the circumstances of the case?

Having found that reinstatement is inappropriate, it does not automatically follow that a payment for compensation is appropriate. As noted by the Full Bench, “[t]he question whether to order a remedy in a case where a dismissal has been found to be unfair remains a discretionary one…”[65].

The Applicant submits that payment of compensation is appropriate because she had been unfairly dismissed and has so far not secured alternate employment since her dismissal, whereas the Respondent argued that any compensation should be limited given the Applicant has made no attempts to mitigate her loss by seeking alternate employment. I will return to the Applicant’s mitigation efforts below.

The Applicant was unfairly dismissed and noting that the Applicant remains unemployed, in these circumstances, I consider that an order for payment of compensation is appropriate. There is nothing in the material filed by the Respondent in the substantive proceedings, which was not tested in an evidentiary sense in any case, that persuades me that a payment of compensation would be inappropriate.

Compensation – what must be taken into account in determining an amount?

Section 392(2) of the Act requires all of the circumstances of the case to be taken into account when determining an amount to be paid as compensation to the Applicant in lieu of reinstatement including:

(a)the effect of the order on the viability of the Respondent’s enterprise;

(b)the length of the Applicant’s service;

(c)the remuneration that the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed;

(d)the efforts of the Applicant (if any) to mitigate the loss suffered by the Applicant because of the dismissal;

(e)the amount of any remuneration earned by the Applicant from employment or other work during the period between the dismissal and the making of the order for compensation;

(f)the amount of any income reasonably likely to be so earned by the Applicant during the period between the making of the order for compensation and the actual compensation; and

(g)any other matter that the Commission considers relevant.

I consider all the circumstances of the case below.

Effect of the order on the viability of the Respondent’s enterprise

The Respondent acknowledges that it is a large employer and did not contend that an order for compensation would have an effect on its viability. I consequently find that an order for compensation is unlikely to have an effect on the viability of the employer’s enterprise.

Length of the Applicant’s service

The Applicant commenced employment with the Respondent in December 2015 and was terminated on 20 May 2022 a period of some 6.5 years which was served as a full-time employee. I consider that the Applicant’s length of service is such that it does not favour an adjustment to the compensation otherwise calculated.

Remuneration that the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed

As stated by a majority of the Full Court of the Federal Court, “in determining the remuneration that the Applicant would have received, or would have been likely to receive… the Commission must address itself to the question whether, if the actual termination had not occurred, the employment would have been likely to continue, or would have been terminated at some time by another means. It is necessary for the Commission to make a finding of fact as to the likelihood of a further termination, in order to be able to assess the amount of remuneration the employee would have received, or would have been likely to receive, if there had not been the actual termination.”[66]

The Applicant states that she loved her job at Nobu, she was approaching seven years’ service which would have entitled her to long service leave, she had not been subject to any previous counselling or warnings for conduct or work performance issues and would have continued to work for the Respondent on an indefinite basis but for her dismissal. The Respondent did not challenge that evidence.

I accept the Applicant’s evidence that she enjoyed her role at Nobu and that she was likely to have remained with the Respondent for an extended period had she not been dismissed. The Applicant arrived in Australia in late 2014 and has largely worked for the one employer since her arrival from China. I also note there were no prior counselling or warnings and that she was promoted to the position of Chef de Partie in December 2019, the latter point indicating that she was valued as an employee by the Respondent.

The combination of the above-referred factors leads me to conclude that, but for her dismissal, the Applicant would have remained employed by the Respondent for a reasonable length of time and at least until her long service leave fell due at the end of 2022. Balanced against that assessment is the difficulty of predicting employment tenure, even more so in the hospitality industry which routinely features a high level of attrition and turnover.

I am satisfied that, had the Applicant not been dismissed, it is likely that she would have remained in the Respondent’s employment for a further 12 months. In reaching this conclusion I have had particular regard to the Applicant’s length of employment with the Respondent and her desire to secure her long service leave entitlement that would have fallen due at the end of 2022.

The Applicant’s annual salary (excluding superannuation) at the time of her dismissal was $80,606.97. This represents the anticipated earnings for the 12-month period I estimate the Applicant would have remained employed for.

Efforts of the Applicant to mitigate the loss suffered by the Applicant because of the dismissal

The Applicant must provide evidence that she has taken reasonable steps to minimise the impact of her dismissal.[67] What is reasonable depends on the circumstances of the case.[68]

The Applicant readily admitted that she has not applied for any positions since her dismissal by the Respondent on 20 May 2022. She explained her inaction as due to her feelings of fear and shame at having to honestly explain, if asked by a prospective employer why she had left Nobu, that she had been dismissed by Nobu for serious misconduct for the alleged theft of tips. She further stated that she was unwilling to seek new employment until the matter of her dismissal was determined by the Commission

While I accept that the Applicant may have felt fear and shame at the circumstances of her dismissal by the Respondent, that is no different to many other employees who hold feelings of humiliation, hurt, distress or injustice at the circumstances of their dismissal. Those understandable feelings do not alleviate the obligation of a dismissed employee to make efforts to mitigate their loss. In the present case the Applicant has made no effort to secure new employment, which in the circumstances of this case warrants a 70% reduction in compensation.

Amount of remuneration earned by the Applicant from employment or other work during the period between the dismissal and the making of the order for compensation

The Applicant’s evidence is that she has not earned income from any other source since her dismissal on 20 May 2022. That evidence was not challenged by the Respondent.

I am satisfied that the Applicant has not earned any income from employment or other work during the period since her dismissal on 20 May 2022. Consequently, no deduction is to be made in respect of earnings since dismissal.

Amount of income reasonably likely to be so earned by the Applicant during the period between the making of the order for compensation and the actual compensation

The Applicant’s evidence is that she is unlikely to earn income in the period between the making of the order for compensation and the payment of compensation.

I am satisfied that the Applicant is unlikely to earn income between the making of an order for compensation and the payment of the compensation. Consequently, no deduction is to be made in respect of likely earnings in that period.

No other relevant matters were raised by the parties going to an order for compensation.

Compensation – how is the amount to be calculated?

As noted by the Full Bench, “[t]he well-established approach to the assessment of compensation under s.392 of the FW Act… is to apply the “Sprigg formula” derived from the Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul’s Licensed Festival Supermarket (Sprigg).[69] This approach was articulated in the context of the Act in Bowden v Ottrey Homes Cobram and District Retirement Villages[70].”[71]

The approach in Sprigg is as follows:

Step 1: Estimate the remuneration the Applicant would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).

Step 2: Deduct monies earned since termination.

Step 3: Discount the remaining amount for contingencies.

Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.

Step 1

I have estimated the remuneration the Applicant would have received, or would have been likely to have received, if the Respondent had not terminated her employment to be $80,606.97 on the basis of my finding, it is likely the Applicant would have remained in employment for a further period of 12 months. This estimate of how long the Applicant would have remained in employment is the “anticipated period of employment”.[72]

Step 2

I have found that the Applicant has not earned any amount of remuneration since the date of her dismissal, and that she is unlikely to earn any remuneration between the making of the order for compensation and the payment of compensation.

Only monies earned since termination for the anticipated period of employment are to be deducted.[73] Consequently, no deductions are to be made for earnings.

I have also found however that the Applicant has failed to take reasonable steps to mitigate her losses and consequently I intend to deduct 70% to reflect that. This reduces the amount of compensation to $24,182.10.

Step 3

I now need to consider the impact of contingencies on the amounts likely to be earned by the Applicant for the remainder of the anticipated period of employment.[74]

I do not consider it appropriate to deduct an amount for contingencies.

Step 4

I have considered the impact of taxation but have elected to settle a gross amount of $24,182.10 which is to be subject to normal taxation.

Having applied the formula in Sprigg, I am nevertheless required to ensure that “the level of compensation is an amount that is considered appropriate having regard to all the circumstances of the case.”[75]

I am satisfied that the amount of compensation that I have determined above takes into account all the circumstances of the case as required by s.392(2) of the Act.

Compensation – is the amount to be reduced on account of misconduct?

As I have earlier found, the Applicant engaged in misconduct by covertly recording a conversation with Ms Barnewall without Ms Barnewall’s knowledge or consent. While I am not satisfied that the conduct was sufficiently serious to establish a valid reason for the Applicant’s dismissal, it nonetheless constituted misconduct which I am satisfied should be taken into account in determining compensation. I intend to apply a further discount of 50% to the amount of compensation calculated above. This results in the amount of compensation being reduced to $12,091.05.

Compensation – how does the compensation cap apply?

Section 392(5) of the Act provides that the amount of compensation ordered by the Commission must not exceed the lesser of:

(a)the amount worked out under section 392(6); and
(b)half the amount of the high income threshold immediately before the dismissal.

The amount worked out under section 392(6) is the total of the following amounts:

(a)the total amount of the remuneration:

(i) received by the Applicant; or
(ii) to which the Applicant 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 Applicant 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 Applicant for the period of leave is in accordance with the regulations.

Based on the Applicant’s annual salary at the date of dismissal I find that the total amount of the remuneration received by the Applicant in the 26 week period prior to her dismissal on 20 May 2022 was approximately $40,303.49.

The high income threshold immediately before the dismissal on 20 February 2019 was $158,500. Half of that amount is $79,250.

The amount of compensation ordered by the Commission must therefore not exceed $40,303.49.

Considering the above, I will make an order that the Respondent pay $12,091.05 gross less taxation as required by law to the Applicant in lieu of reinstatement within 14 days of the date of this decision.

Conclusion

I am satisfied that the Applicant was dismissed at the initiative of the Respondent.

Having been satisfied in respect of the other initial matters, I have considered and determined that the Applicant’s dismissal was unjust, unreasonable and thereby unfair. I am further satisfied that reinstatement would be inappropriate and that an award of compensation is appropriate.

Finally, I have determined to make an order that the Respondent pay $12,091.05 gross less taxation as required by law to the Applicant in lieu of reinstatement within 14 days of the date of this decision. An order giving effect to this decision will be issued separately in conjunction with this decision.

DEPUTY PRESIDENT

Appearances:

L Yu, Applicant.
B Richardson and M Maccora for the Respondent.

Hearing details:

2022.

Melbourne:
September 12, 13.

[1] Exhibit A1, Witness Statement of Lai Yu at [1]-[3], Exhibit A2, Letter of employment, dated 4 December 2015

[2] Exhibit R1, Witness Statement of Carlie Barnewall, dated 24 August 2022 at [5]

[3] Exhibit A1 at [4], Exhibit A5, Position Description – Chef de Partie

[4] Ibid, Organisation Chart – Nobu, dated 1 July 2011

[5] Exhibit A5

[6] Exhibit A1 at [6]-[7]

[7] MA000009

[8] Applicant Outline or Argument at 2a.

[9] Respondent Outline of Argument at 2c.

[10] Exhibit R1, Attachment 1, Gifts, Tips and Gratuities & Supplier Gifts and Gratuities Policy, Version 10 dated November 2009

[11] Ibid at clause 2.3

[12] Exhibit R1, Attachment 1, Benefits or Gifts & Gratuities Handling Procedure, Version 5.2 dated November 2021

[13] Exhibit R1 at [9]

[14] Ibid at [10]

[15] Ibid at [11], Attachment 2, Notice to all Nobu employees dated 14 December 2019

[16] Exhibit R1 at [11]

[17] Exhibit R1 at [12]

[18] Exhibit A2, Second Witness Statement of Lai Yu at [1]-[3]

[19] Exhibit A1 at [10]-[12]

[20] Ibid at [21]

[21] Exhibit R1, at [13]-[15]

[22] Exhibit R4, Witness Statement of Tim Sharland, dated 24 August 2022, at [5]-[10]

[23] Exhibit R1 at [18], Exhibit RD, Meeting invite titled ‘Nobu BOH Tips Investigation – Elaine’

[24] Exhibit R1 at [19]

[25] Ibid at [20]-[21]

[26] Exhibit R4 at [12]

[27] Exhibit R1, Attachment 5, 20 May 2022 Meeting invite, titled ‘Nobu BOH Tips Investigation (meeting 2)’

[28] Exhibit R1 at [22]

[29] Ibid at [25]-[26]

[30] Ibid at [27]-[28]

[31] Exhibit A2 at [6]-[8]

[32] Exhibit A1 at [22]-[25]

[33] Exhibit R1 at [31]-[32]

[34] Ibid at [34]-[35]

[35] Ibid at [36]

[36] Exhibit A2 at [12]-[18]

[37] Exhibit R3, Witness Statement of Daniel Khoo, dated 24 August 2022, at [3], [7], [10], [18]

[38] Ibid at [21]-[23]

[39] Ibid at [29]-[30]

[40] Exhibit R1, Attachment 5, Resignation email dated 20 May 2022

[41] Exhibit R1, Attachment 6, Resignation withdrawal emails, dated 20 May 2022

[42] Exhibit R1, Attachment 7, Termination of Employment Letter, dated 22 May 2022

[43] Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373.

[44] Ibid.

[45] Walton v Mermaid Dry Cleaners Pty Ltd(1996) 142 ALR 681, 685.

[46] Ibid.

[47] King v Freshmore (Vic) Pty Ltd (unreported, AIRCFB, Ross VP, Williams SDP, Hingley C, 17 March 2000) Print S4213

[24].

[48] Ibid.

[49] Ibid.

[50] Briginshaw v Briginshaw (1938) 60 CLR 336, [1938] HCA 34.

[51] Exhibit R1, Attachment 7

[52] [2022] FWC 711.

[53] Ibid at [34].

[54] [2022] FWC 1593.

[55] Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, 151.

[56] Previsic v Australian Quarantine Inspection Services Print Q3730 (AIRC, Holmes C, 6 October 1998).

[57] Ibid.

[58] Chubb Security Australia Pty Ltd v Thomas Print S2679 (AIRCFB, McIntyre VP, Marsh SDP, Larkin C, 2 February 2000), [41]; Read v Cordon Square Child Care Centre [2013] FWCFB 762, [46]-[49].

[59] Crozier v Palazzo Corporation Pty Ltd t/a Noble Park Storage and Transport Print S5897 (AIRCFB, Ross VP, Acton SDP, Cribb C, 11 May 2000), [75].

[60] RMIT v Asher (2010) 194 IR 1, 14-15.

[61] Gibson v Bosmac Pty Ltd (1995) 60 IR 1, 7.

[62] Chubb Security Australia Pty Ltd v Thomas Print S2679 (AIRCFB, McIntyre VP, Marsh SDP, Larkin C, 2 February 2000), [41]; Read v Cordon Square Child Care Centre [2013] FWCFB 762, [46]-[49].

[63] Explanatory Memorandum, Fair Work Bill 2008 (Cth), [1542].

[64] ALH Group Pty Ltd t/a The Royal Exchange Hotel v Mulhall (2002) 117 IR 357, [51]. See also Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002), [92]; Edwards v Justice Giudice [1999] FCA 1836, [6]–[7].

[65] Nguyen v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter[2014] FWCFB 7198, [9].

[66] He v Lewin [2004] FCAFC 161, [58].

[67] Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34] citing Lockwood Security Products Pty Ltd v Sulocki and Ors PR908053 (AIRCFB, Giudice J, Lacy SDP, Blair C, 23 August 2001), [45].

[68] Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34] citing Payzu Ltd v Saunders [1919] 2 KB 581.

[69] (1998) 88 IR 21.

[70] [2013] FWCFB 431.

[71] Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries[2016] FWCFB 7206, [16].

[72] Ellawala v Australian Postal Corporation Print S5109 (AIRCFB, Ross VP, Williams SDP, Gay C, 17 April 2000), [34].

[73] Ibid.

[74] Enhance Systems Pty Ltd v Cox PR910779 (AIRCFB, Williams SDP, Acton SDP, Gay C, 31 October 2001), [39].

[75] Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries[2016] FWCFB 7206, [17].

Printed by authority of the Commonwealth Government Printer

OPTION	ALLOCATION	DESCRIPTION
1	Team Building	All tips are to be pooled and used to pay for team building events
2	Individual Tips (a)	All tips are retained by each individual who received these in full.
3	Individual Tips (b)	All tips are retained by each individual who received these less an agreed withheld amount. This withheld amount is then collated and distributed among eligible staff based on hours worked (as per Communal Benefits, below)
4	Communal (Pooled) Tips (a)	All tips are pooled and distributed to all eligible employees based on hours worked and split amongst all employees in the outlet.
5	Communal (Pooled) Tips (b)	All tips are pooled and distributed to all eligible employees based on hours worked and split between working groups on an agreed percentage basis and then to all eligible employees within those working groups
6	Outlet Specific	Where eligible employees in a venue or outlet seek to use an alternative method as an exception to the standard.