Mary Gorski v Beaute Pacifique Skincare Pty Ltd T/A Australian Dermal Supplies

[2018] FWC 3515

[2018] FWC 3515

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Mary Gorski
v
Beaute Pacifique Skincare Pty Ltd T/A Australian Dermal Supplies
(U2017/9894)

COMMISSIONER GREGORY MELBOURNE, 22 JUNE 2018

Application for relief from unfair dismissal –termination of employment –jurisdiction objections – extension of time – resignation - minimum employment period – jurisdictional objections dismissed – extension of time granted.

Introduction

[1] Mrs Mary Gorski was employed by Beaute Pacifique Skincare Pty Ltd T/A Australian Dermal Supplies (“ADS”) as a Sales Representative/Business Development Manager. She was also a Director of the business and a shareholder. However, she claims to have been dismissed from her employment in August last year and then lodged an unfair dismissal application on 12 September 2017. However, ADS responded by raising three separate jurisdictional objections to the application. It submits, firstly, that it was lodged outside of the 21 day time period. It also submits that Mrs Gorski was not dismissed and instead resigned from her employment. It finally submits that she has not completed the required minimum employment period. This decision deals with each of these jurisdictional objections.

[2] It is also noted that there have been various attempts to resolve this matter on an agreed basis, with the Commission having been involved in some of those discussions. In December last year the Commission sent an email to the parties based on its understanding of an agreement that had been reached in previous discussions, 1 however, it was subsequently advised that the terms of that agreement were no longer acceptable to the parties.2 The Commission was subsequently advised that there were further ongoing discussions taking place, and the hearing of the application should be deferred pending their outcome.3 However, the Commission was then advised that the matter had not been able to be resolved and Mrs Gorski now sought to have it determined by way of arbitration.4

[3] Mrs Gorski appeared in the proceedings from Perth by means of video conference. Mr Michael Edgley, the General Manager of ADS, appeared on behalf of the Respondent, together with Mr Derek Freedman, Procurement and Logistics Manager. The Commission also emphasised at the outset that the proceedings were only dealing with the jurisdictional objections raised by ADS at this time, and if it upheld one or other of the jurisdictional objection then the application would be dismissed. However, if it found that the jurisdictional objections were without foundation then the matter would be referred to another Commission member in order to deal with Mrs Gorski’s substantive unfair dismissal application. The Commission also confirmed that the parties had previously provided submissions and evidence in accordance with the directions issued. It was also noted that the Commission had subsequently asked both parties whether they wished to provide any further submissions or evidence, but both had indicated that they did not.

[4] As indicated there are three jurisdictional objections to be dealt with. I now turn to deal with each of those objections.

1. Application was not lodged within 21 days after the dismissal took effect

[5] Section 394(2) of the Act provides that an unfair dismissal application must be made within 21 days after the dismissal took effect, or within such further period as the Commission allows in accordance with sub section s.394(3). It states:

“(3) The FWC may allow a further period for the application to be made by a person under subsection (1) if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and

(b) whether the person first became aware of the dismissal after it had taken effect; and

(c) any action taken by the person to dispute the dismissal; and

(d) prejudice to the employer (including prejudice caused by the delay); and

(e) the merits of the application; and

(f) fairness as between the person and other persons in a similar position.” 5

The Evidence and Submissions

[6] ADS submits that the application was not lodged within 21 days of the date of dismissal and should therefore be dismissed.

[7] Mrs Gorski states in response that she was dismissed on 15 August 2017, but her unfair dismissal application was not lodged until 12 September 2017. She accordingly acknowledges that it was lodged 7 days outside of the 21 day time period referred to in s.394(2). However, she states that she obtained legal advice following her dismissal, and her solicitor was then involved in a series of negotiations with representatives from ADS, which were particularly designed to enable her to obtain a release so that she could continue to work in the industry. 6 Her solicitor was also unwell during some of this time and this also contributed to delays in the process. Mrs Gorski also indicated that she was concerned at the time that ADS were deliberately acting to delay the process.7 However, the negotiations were ultimately unable to reach an agreed outcome and this was confirmed on 15 September last year. Mrs Gorski immediately proceeded to lodge an unfair dismissal application at that time.

[8] Mrs Gorski also said that during the period following her dismissal she “was constantly asking my lawyer to allow me to lodge a claim,” 8 but “it was his expert opinion that it would harm any chances of getting a release, but in the end they would not give me a release.”9 She also indicated that she had previously provided the Commission with a letter from her solicitor indicating that he was trying to resolve the matter without it necessarily going any further. It was accordingly as a consequence of his direction that she did not lodge her unfair dismissal application within the 21 day period, despite wanting to do it straight away.

[9] The letter from her solicitor, Mr Johan de Klerk from the firm of Legacy Legal WA is dated 4 October 2017. It states:

“I refer to our telephone conversation of earlier today and wish to confirm that we were instructed by Mary Gorski to act on her behalf in relation to a possible settlement in relation to the disputes between Mrs Gorski and Australian Dermal Supplies.

On the 10th of August 2017 these bona fide settlement negotiations commenced aiming to settle all disputes between the parties and to prevent unnecessary litigation.

Unfortunately, the settlement negotiations fail to achieve the desired outcome and came to an end on the 15th September 2017.

Due to the advance state of negotiations we advised the client that a claim with the Fair Work Commission at that stage could negatively affect the outcome of the settlement negotiations.” 10

[10] ADS then advised that it had not been provided with a copy of this letter, and the Commission accordingly indicated that it would be provided with a further period of 7 days to provide any submissions about the content of the letter. It then provided a response in an email dated 29 May 2018. 11 It indicated at that time that it had provided correspondence to Mrs Gorski’s legal representative on 15 August, but had received no response. It then followed up again on 21 August and a response was finally provided by her solicitor on 31 August. Her solicitor had also indicated that it had been difficult to contact Mrs Gorski as she had been on annual leave.

Consideration

[11] The Act makes clear that in considering whether to exercise the discretion to grant additional time in which to make application the Commission must take account of each of the matters in s.394(3). The question of what is required to constitute “exceptional circumstances” has also been considered in a number of previous Commission decisions, including in the Full Bench decision in Nulty v Blue Star Group Pty Ltd. 12 The Full Bench came to the following conclusion in that matter at [13]:

“In summary, the expression “exceptional circumstances” has its ordinary meaning and requires consideration of all the circumstances. To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. Circumstances will not be exceptional if they are regularly, or routinely, or normally encountered. Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. It is not correct to construe “exceptional circumstances” as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural “circumstances” as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of “exceptional circumstances” includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon.” 13

[12] I now turn to deal with this matter having regard to the various considerations in s.394(3) and those authorities that I consider are relevant to the determination of the matter.

(a) the reason for the delay

[13] Mrs Gorski primarily relies on “representative error” as the reason for the delay in making her application. She also submits that ADS were acting to deliberately delay the negotiations taking place at the time in order to extend the process beyond the 21 day time period. However, I am not satisfied that there is any evidence before the Commission at this time to support this claim.

[14] However, it does appear from her submissions, and the correspondence provided by her solicitor, that she was being advised at the time to defer making an unfair dismissal application pending the outcome of the ongoing negotiations that were endeavouring to have the restraints removed that acted to prevent her continuing to work in the industry. It is not for the Commission to be making an assessment at this point about the merit of that advice, although it would appear unusual to act in the face of statutory time limitations. However, I am satisfied that Mrs Gorski was entitled to rely on the advice being provided by her legal representative, and it provided the rationale as to why her application was not lodged within the 21 day time period. It is also noted that as soon as it became clear that the negotiations had broken down Mrs Gorski proceeded to lodge her application immediately.

[15] The decision of the Full Bench in Clark v Ringwood Private Hospital 14 identified the following general propositions that should be taken into account in deciding whether or not representative error constitutes an acceptable explanation for the delay. It sought to draw a distinction between circumstances in which an Applicant can be considered blameless for the delay in lodging, and circumstances in which he or she should accept some responsibility for the delay. The propositions identified by the Full Bench in its decision are, in summary, as follows:

•  depending on the particular circumstances representative error may be a sufficient reason to extend the time in which to make application;

•  a distinction should be drawn between delay properly apportioned to an Applicant’s representative where the Applicant is blameless, and delay occasioned by the conduct of the Applicant;

•  the conduct of the Applicant is a central consideration in deciding whether representative error provides an acceptable explanation for the delay; and

•  error by the Applicant’s representative is only one of a number of factors to be considered.

[16] I am satisfied in response that Mrs Gorski did not wait and do nothing, but was instead actively seeking to pursue an unfair dismissal application, and had given instructions to her solicitor to make application on her behalf. However, she was advised to defer making application pending the outcome of the ongoing negotiations. I am satisfied that she was entitled to rely on that advice from her legal representative, and accordingly can be considered to be “blameless” for the fact the application was not lodged within the 21 day time period.

(b) whether the person first became aware of the dismissal after it had taken effect;

[17] Mrs Gorski was aware that she had been dismissed at the time the decision took effect, although it is also noted that ADS submits she was not dismissed, but instead resigned from her employment.

(c) any action taken by the person to dispute the dismissal;

[18] It appears that Mrs Gorski immediately sought legal advice about her options following her dismissal, although there were obviously a number of additional matters under consideration in this context as well.

(d) prejudice to the employer (including prejudice caused by the delay);

[19] It is acknowledged that there will always be some prejudice to an employer if additional time is granted in which to make an unfair dismissal application, given that it will then be in a position where it will have to respond to the application. There has also now been a considerable period of delay since Mrs Gorski last worked for ADS. However, it is also noted that this occurred, in large part, due to the protracted negotiations taking place between the parties in an endeavour to resolve the matter on some agreed basis.

(e) the merits of the application

[20] The parties have provided only limited submissions and evidence in this matter, and the Commission at this time it is unable to form any clear view about the respective merits of Mrs Gorski’s unfair dismissal application. However, it is also noted that previous Commission decisions have concluded that the Commission is not required to embark on a detailed consideration of the substantive case at this time. It has also been noted that while the issue of merit is important, the exercise of the discretion to grant additional time should have primary regard to the circumstances that led to the late lodgement.

(f) fairness as between the person and other persons in a similar position

[21] Neither party made submissions suggesting this consideration was of any particular importance in the present matter.

Conclusion

[22] I am satisfied that the evidence and submissions now before the Commission indicate that Mrs Gorski did given instructions to her legal representative to make an unfair dismissal application on her behalf, but was advised against doing so at the time. I am also satisfied that she was entitled to rely on the advice of her representative, despite the fact that this meant that her application was not lodged within the standard 21 day period. However, I am satisfied that Mrs Gorski was blameless in all the circumstances and did everything that could reasonably be expected of her. I am also satisfied that these circumstances are “exceptional” in that they are unusual or uncommon, and it is therefore appropriate for the Commission to exercise its discretion to grant her additional time in which to make application.

2. No Dismissal

[23] ADS submits that Mrs Gorski was not dismissed but instead agreed to “finish up” 15 on 16 August last year. It submits that her decision was prompted by the loss of a major supplier which threatened the ongoing viability of the business. A brief statement was provided by Mr Norman Tendler in support of this submission. He was apparently the CEO of ADS at the time, but is now no longer employed by the business. However, he did not attend the hearing and was not able to be cross-examined in regard to his evidence.

[24] Mr Edgley also provided a brief statement which indicated:

“Mary Gorski was never dismissed. I had written to her (Statement of Evidence) and her fellow shareholders about her behaviour and that if she continued on with this behaviour and disrespect shown towards myself I would be giving her a 1st and Final Warning that would terminate her employment contract. She would then continue on as a Shareholder.” 16

[25] Mrs Gorski submits in response that she was dismissed and relies on the content of an email she received from Mr Tendler on 15 August 2017. The email was attached to her application and states:

“Hi Mary

We have replied to your solicitors.

I think it’s best you finish up this Wednesday with your payment, as agreed, as we need to pay our outstanding invoices and there are currently insufficient funds, unless you want to contribute funds to ADS?

Regards Norm” 17

[26] Mrs Gorski also submitted that there was no reason why she would resign from her employment in circumstances where she did not have another job to go to. This was demonstrated by her attempts to remove the restraint that apparently prevented her from continuing to work in the same industry.

Consideration

[27] I am not satisfied that there is any evidence before the Commission, such as a letter of resignation or evidence of other conversations, that points to Mrs Gorski having resigned from her employment. Her actions and the available evidence, including the above email from Mr Tendler, are instead consistent with her employment having been terminated. The second jurisdictional objection is accordingly dismissed.

3. Minimum Employment Period

[28] ADS submits that it is a small business employer as defined in the Act in that it has less than 15 employees. An Applicant is therefore required to have been employed for more than 12 months before they are entitled to bring an unfair dismissal claim. It again relies on a statement from Mr Tendler, which indicates that Mrs Gorski resigned as a Director at her own request in March 2017 and then entered into a 6 months employment contract, in support of this submission. It also relies on the content of an email dated 5 March 2017 that Mrs Gorski sent to Mr Tendler that was contained in the materials it submitted. It indicates in part, “I tender my resignation as a director of ADS effective immediately.” 18 She also indicates in that email, “I have now had the opportunity to review in full the proposed employment contract and would like to move forward.”19 It therefore submits that her period of continuous employment with the business at the time of her dismissal was only 6 months.

[29] Mrs Gorski submits in response that she was first employed in July 2015 and worked continuously from that time until she was terminated in August last year. She said that she received entitlements in respect of public holidays, sick leave and annual leave during that period as would be expected in an employment relationship. At the time of her dismissal she was paid a wage of $6,400 per month and also received a car allowance of $42 per week. She also indicated that she was pursuing the business for outstanding superannuation contributions due to her as an employee. She was finally able in March last year to have ADS agree to set out her employment arrangements in a formal employment contract. A copy of that so-called Sales Representative and Training Consultant Agreement was attached to her application. She indicated that she was also at varying times a Director and shareholder of ADS, however, she also remained an employee throughout. She also acknowledged that the business employed less than 15 employees.

Consideration

[30] ADS relies on the statement of Mr Tendler to assert that Mrs Gorski was first employed by the business in March of last year, and had only been employed for around 6 months at the time her employment ended. However, Mr Tendler was not present at the hearing, and ADS did not seek to provide any further submissions or evidence about this matter during the course of the hearing, despite being provided with the opportunity to do so.

[31] Mrs Gorski states that she has been employed since April 2015 in a sales/business development role and received paid leave entitlements during that time in a manner consistent with her being an employee. She also states that she was carrying out her role as an employee, and not as a Director of the business, even though she was also a Director at the time.

[32] ADS did not provide any evidence to refute these statements by Mrs Gorski. I am accordingly satisfied that she has been employed with ADS for a period of at least 12 months, and that therefore she has satisfied the minimum employment period. The final jurisdictional objection raised by ADS is accordingly dismissed.

Conclusion

[33] This decision has dismissed each of the jurisdictional objections raised by ADS. The Commission has also decided that it is appropriate to exercise the discretion available to it to grant Mrs Gorski additional time in which to make application. An Order will accordingly now be issued to that effect [PR608155]. Her application will also now be referred to another Commission member to be relisted to enable her substantive unfair dismissal application to be heard and determined.

COMMISSIONER

Appearances:

M Gorski on her own behalf.

G Edgley and D Freedman for the Respondent.

Hearing details:

2018.

Melbourne and Perth (video hearing):

May 23.

Printed by authority of the Commonwealth Government Printer

<PR608154>

 1   Email correspondence from Gregory C to Mary Gorski and Grant Edgley, dated 12 December 2017.

 2   Email correspondence from Mary Gorski to Gregory C, dated 20 December 2017.

 3   Email correspondence from Mary Gorski to Gregory C, dated 5 April 2018.

 4   Email correspondence from Mary Gorski to Gregory C, dated, 6 April 2018.

 5   Fair Work Act 2009 (Cth)s 394(3).

 6   Witness statement of Mary Gorski, received 10 November 2017, p 2.

 7   Ibid.

 8   Transcript, 23 May 2018, [PN23].

 9   Ibid.

 10   Letter from Johan de Klerk to Jamie Hawkins, dated 4 October 2017, submitted by Applicant on 1 November 2017.

 11   Email correspondence from Grant Edgley to Gregory C, dated 29 May 2018.

 12   [2011] FWAFB 975.

 13 Ibid at [13].

 14   Clark v Ringwood Private Hospital (AIRC, Ross VP, Drake DP and Deegan C, 22 September 1997) [Dec 1159/97 S Print P5279].

 15   Submissions of Respondent, received 31 October 2017, [5a].

 16   Witness statement of Grant Edgley, received 31 October 2017.

 17   Email correspondence from Norman Tendler to Mary Gorski, dated 15 August 2017, Attachment to Form F2-Unfair dismissal application, lodged 12 September 2017.

 18   Email correspondence from Mary Gorski to Norman Tendler, dated 9 June 2017, Attachment to witness statement of Normal Tendler, lodged 31 October 2017.

 19   Ibid.