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Lipa Pharmaceuticals v Jarouche

Lipa Pharmaceuticals v Jarouche

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[2023] FWCFB 101

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.604 - Appeal of decisions

Lipa Pharmaceuticals Ltd
v

Mariam Jarouche

(C2023/1492)

JUSTICE HATCHER, PRESIDENT
VICE PRESIDENT CATANZARITI
DEPUTY PRESIDENT BINET

SYDNEY, 31 MAY 2023

Appeal against decision [2023] FWC 493 of Deputy President Anderson at Adelaide on 28 February 2023 in matter number C2022/7079

Introduction

Lipa Pharmaceuticals Ltd (Lipa) has lodged an appeal, for which permission is required, against a decision of Deputy President Anderson issued on 28 February 2023.[1] The decision concerned a jurisdictional objection made by Lipa in respect of an application made by Dr Mariam Jarouche pursuant to s 365 of the Fair Work Act 2009 (Cth) (FW Act) in which she alleged that she was dismissed from employment with Lipa in contravention of ss 340, 351 and 352 of the FW Act. Lipa contended that Dr Jarouche’s application was not validly made because she had not been dismissed but rather resigned from her employment. In his decision, the Deputy President rejected this contention and, in conjunction with his decision, made an order[2] by which he determined to issue a certificate in accordance with s 368(3)(a) of the FW Act.

Section 365 provides:

365 Application for the FWC to deal with a dismissal dispute
If:
(a)a person has been dismissed; and

(b)the person, or an industrial association that is entitled to represent the industrial interests of the person, alleges that the person was dismissed in contravention of this Part;

the person, or the industrial association, may apply to the FWC for the FWC to deal with the dispute.

In respect of an application made under s 365, s 368(1) of the FW Act requires that the Commission ‘deal’ with dispute other than by arbitration. The statutory note to s 368(1) states, by reference to s 595(2), that the Commission may ‘deal’ with such a dispute by mediation or conciliation, or by making a recommendation or expressing an opinion. Section 368(3)(a) provides that if the FWC is satisfied that all reasonable attempts to resolve the dispute (other than by arbitration) have been, or are likely to be, unsuccessful, then the FWC must issue a certificate to that effect. Once such a certificate has been issued, the applicant is entitled to make a general protections court application subject to the time limitation in s 370(a)(ii), unless the parties have agreed to the Commission arbitrating the dispute pursuant to s 369.

As the Deputy President correctly stated in paragraph [72] of his decision, a valid application under s 365 requires that the relevant dismissal has actually occurred as a matter of jurisdictional fact. It is not sufficient that the applicant has merely alleged that they were dismissed. If there is a contest as to whether the alleged dismissal the subject of the application has occurred, this is an antecedent question which, according to the Federal Court Full Court decision in Coles Supply Chain Pty Ltd v Milford[3] (Milford) ‘must be resolved before the powers conferred…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2023] FWCFB 101
Decision Date: 31 MAY 2023

CaseChat Overview and Summary

In the case of Lipa Pharmaceuticals v Jarouche, the dispute centred on the employment termination of Dr Jarouche by Lipa Pharmaceuticals. Dr Jarouche alleged that she had been constructively dismissed, while Lipa argued that she had resigned. The matter was brought before the Fair Work Commission and ultimately reached the Full Bench for determination of the key legal issues. The primary issue before the court was whether Dr Jarouche was dismissed by Lipa Pharmaceuticals or whether she resigned from her employment. The court needed to discern the true nature of the termination of Dr Jarouche's employment, considering the actions of both parties and the context in which they occurred.

The court found that the conduct of Mr Tanna, a representative of Lipa Pharmaceuticals, on 29 September 2022 and subsequent days clearly indicated an intention to terminate Dr Jarouche's employment. The court held that Dr Jarouche had no real choice other than to resign, as evidenced by the immediate cessation of her work and departure from the workplace following Mr Tanna's meeting with her. The court further clarified that although the exact terms of the departure were later negotiated, the fundamental decision to end Dr Jarouche's employment had already been made by Lipa Pharmaceuticals on 29 September 2022. The court determined that Dr Jarouche's acceptance of the proposed 'managed resignation' was a response to the already imposed reality of her employment termination.

In light of the findings, the court concluded that Dr Jarouche had been dismissed by Lipa Pharmaceuticals, within the meaning of section 386(1) of the Fair Work Act. This conclusion was based on the jurisdictional fact that Dr Jarouche's employment relationship had effectively ended on Lipa's initiative on 29 September 2022, despite the subsequent negotiations over the terms of her departure. The court upheld the decision of the Deputy President that Dr Jarouche had been dismissed and rejected Lipa's appeal.

Orders

Orders of the court

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Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

As earlier stated, Lipa accepts that the conduct of Mr Tanna on 29 September 2022 and the days following was intended to bring Dr Jarouche’s employment to end but contends that this conduct did not result in Dr Jarouche having no effective or real choice other than to resign. We disagree. Having regard to the events of 29 September 2022 in particular, it is not possible to identify any choice which Dr Jarouche might have exercised in response to Lipa’s conduct other than resignation. Lipa’s submissions do not identify any alternative choice. Although Mr Tanna expressed himself in somewhat euphemistic terms, what he said at the meeting on 29 September 2022, assessed objectively, can only be understood as conveying that he had made a final decision that Dr Jarouche’s employment was to come to an end. His statement ‘I have avoided making this decision for some months hoping there would be a change’ (underlining added) makes explicit that a decision had been made. Further, Mr Tanna made it clear, albeit again euphemistically, that Dr Jarouche was to cease work and leave the workplace forthwith when he said ‘I’m OK if you wish to take some time to collect your things and say goodbye to your team’ and ‘Are you OK to drive home? Do you need us to organise a ride?’ Consistent with this, Dr Jarouche had returned her laptop, collected her belongings, said goodbye to staff, and left the workplace, never to return, within about 20 minutes of the end of the discussion with Mr Tanna on 29 September 2022. The only matters remaining for consideration after Dr Jarouche left the workplace on 29 September 2022 were the basis and the monetary terms of Dr Jarouche’s departure. For all intents and purposes, her employment had already come to an end. Dr Jarouche’s subsequent accession to Mr Tanna’s proposal for a ‘managed resignation’ must be understood in that context. It was the only response available to the reality which Mr Tanna had already imposed upon her. The only doubt we have about the decision under appeal is whether the better view is that Dr Jarouche’s dismissal arose because she was terminated on the initiative of the employer, within the meaning of s 386(1)(a), on 29 September 2022, rather than having been forced to resign on 5 October 2022. A termination on the initiative of the employer for the purpose of s 386(1)(a) is to be conducted by reference to the termination of the employment relationship, not by reference to the termination of the contract of employment operative immediately before the cessation of the employment.[14] The alternative view would be that Dr Jarouche’s employment relationship came to an end on Lipa’s initiative on 29 September 2022 because of Dr Tanna’s announcement of the decision he had made to that effect and Dr Jarouche’s removal from the workplace the same day, and that what followed until 5 October 2022 was negotiation and jockeying as to the terms upon which the contract of employment would terminate. However, we do not need to pursue this because, on any view, the Deputy President was correct in concluding that Dr Jarouche had been dismissed, within the meaning of s 386(1), as a matter of jurisdictional fact.

Ratio Decidendi

Legal Principle Established

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