Mark Hall v Living Concepts (Vic) Pty Ltd
[2014] FWC 4548
•10 JULY 2014
| [2014] FWC 4548 [Note: An appeal pursuant to s.604 (C2014/5624) was lodged against this decision - refer to Full Bench decision dated 17 November 2014 [[2014] FWCFB 7939] for result of appeal.] |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Mark Hall
v
Living Concepts (Vic) Pty Ltd
(U2014/3529)
DEPUTY PRESIDENT SMITH | MELBOURNE, 10 JULY 2014 |
Application for an unfair dismissal remedy - Small Business Fair Dismissal Code - conduct warranting a valid reason for dismissal - dismissal not harsh, unjust or unreasonable - application dismissed.
Introduction
[1] Mr Mark Hall alleges that the termination of his employment by Living Concepts (Vic) Pty Ltd (Living Concepts) was harsh, unjust or unreasonable. Mr Hall seeks compensation of six months’ salary.
[2] Living Concepts argued that:
● There were financial irregularities in the way in which Mr Hall conducted business arrangements;
● Mr Hall would not accept reasonable management directives, and,
● The business needed to reduce its hours as a result of declining business.
[3] Mr Hall argued that the computer system of Living Concepts did not permit proper billing, there were no written warnings and the instructions given to him were unclear.
The Small Business Fair Dismissal Code
[4] This is a very small business, with only one employee, and therefore the Small Business Fair Dismissal Code (the Code) applies and must be considered in the context of whether or not Mr Hall was unfairly dismissed.
[5] Section 385 of the Fair Work Act 2009 (the Act) provides:
385 What is an unfair dismissal
A person has been unfairly dismissed if the FWC is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.
[6] Section 388 of the Act provides:
388 The Small Business Fair Dismissal Code
(1) The Minister may, by legislative instrument, declare a Small Business Fair Dismissal Code.
(2) A person’s dismissal was consistent with the Small Business Fair Dismissal Code if:
(a) immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened first), the person’s employer was a small business employer; and
(b) the employer complied with the Small Business Fair Dismissal Code in relation to the dismissal.
[7] Relevantly, Living Concepts relied upon that part of the Code which deals with summary dismissal:
Summary Dismissal
It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.
[8] Living Concepts argued it had a reasonable suspicion that Mr Hall was stealing from it by changing invoices and accepting cash. I shall deal with this matter now and other aspects of the Code later.
[9] I pause to note that Mr Hall was almost solely responsible for the day to day operation of Living Concepts. Indeed he was the only employee. Mr Yu, the owner of the business, did not attend on a day to day basis and Mr Hall was responsible for generating business and charging for services. Living Concepts sells bathroom fittings to builders and direct to clients.
[10] Mr Hall submitted that he altered the retail price in some areas so as to coincide with codes in the computer system. His view was that he was assessing the retail price based upon the codes in the computer. This evidence was far from clear. In addition, Mr Hall stated that he was accepting cash because some people paid in cash and Mr Yu had various views on this practice. Mr Hall accepted that he was asked not to accept cash, but he did not consider that to be a warning as it was not provided to him in writing. He agreed that Mr Yu had placed a sign in the store stating “No Cash” but he said that the sign did not make sense.
[11] Mr Hall made general complaints about Mr Yu and his failure to abide by provisions of the Act. He instanced the taking of leave. Mr Hall submitted that when he raised the Act Mr Yu said words to the effect that “you should forget about your laws and think of himself”.
[12] Mr Yu submitted that whilst Mr Hall was in charge his sales dropped by over half from 2011 and that when he checked the invoices for September and October 2013 he found that there was a $12,000 discrepancy. Mr Yu said that because the business was so small his systems were such that he was unable to check his stock against his sales revenue. Mr Yu submitted that on one occasion he was given $1,400 cash from a customer and he could not find the sale in his books, but then later that month Mr Hall raised an invoice for $1,600 for the customer. There were a number of examples given which demonstrated differences in money received and invoices raised.
[13] Mr Yu was also unhappy about the general management of the store and extending credit to some persons against his instructions. Mr Yu said that he was owed money as a result of this practice by Mr Hall.
[14] In response, Mr Hall raised a number of concerns including a faulty computer system and that he was following the previous practice about extending credit.
[15] This is a wholly unsatisfactory case from all sides. Mr Yu’s business practice did not allow him to check stock against sales. He also did not address whether or not there were shortcomings in the computer recording system. On the other hand, Mr Hall did not exhibit traits of a loyal and diligent employee. His belief that warnings needed to be given in writing may have conditioned his failure to pay proper regard to the wishes of the owner of the business.
[16] I turn now to consider the Code. I am not satisfied that Living Concepts could, on reasonable grounds, believe that Mr Hall was guilty of conduct which warranted summary dismissal. I have reached this conclusion because of the inadequacy of the record keeping system of the employer and the inconsistent treatment of cash purchases.
Was the dismissal harsh, unjust or unreasonable?
[17] This means that I now turn to consider s.387, which states:
Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal 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.
[19] In relation to s.387(b), I am satisfied that he was notified of the reason, but was not given any opportunity to respond in accordance with s.387(c). In relation to s.387(d), Mr Hall did not request to have a support person.
[20] In considering whether or not Mr Hall was warned before the dismissal, per s.387 (e), I am satisfied that he was. He knew his employer was unhappy and he was under the misapprehension that warnings had to be in writing.
[21] Section 387(f) has particular relevance in this matter. Living Concepts is a very small employer and there was little to no understanding of processes and procedures in relation to effecting dismissal. Having said that, I am satisfied that Mr Yu did not take the decision lightly. In addition, per s.387(g), there were no human resources specialists within Living Concepts, which resulted in the process of terminating Mr Hall’s employment being clumsy.
Decision
[22] Considering all of the factors referred to in s.387, I am satisfied that the termination of Mr Hall’s employment was not harsh, unjust or unreasonable. I dismiss the application.
DEPUTY PRESIDENT
Appearances:
Mr Hall on his own behalf.
Mr Yu for the Respondent.
Hearing details:
2014.
Melbourne:
6 June.
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