Megan McGuire v Independent Pub Group Pty Ltd T/A Crown Inn Hotel
[2011] FWA 2477
•21 APRIL 2011
[2011] FWA 2477 |
|
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Megan McGuire
v
Independent Pub Group Pty Ltd T/A Crown Inn Hotel
(U2010/13760)
SENIOR DEPUTY PRESIDENT O’CALLAGHAN | ADELAIDE, 21 APRIL 2011 |
Termination of employment - valid reason - flawed process - remedy.
[1] On 2 November 2010 Miss McGuire lodged an application pursuant to s.394 of the Fair Work Act 2009 (the Act), through which she sought relief with respect to the termination of her employment by the Independent Pub Group Pty Ltd T/as Crown Inn Hotel (Crown).
[2] The application was not resolved through the conciliation process. It was listed for arbitration in March and referred to me for this purpose just prior to the nominated hearing date. Neither party was prepared for this hearing.
[3] The matter was subsequently the subject of a hearing on 11 April 2011. Miss McGuire represented herself at this hearing and Crown was represented by Mr Evans of the Australian Hotels Association (SA).
[4] There is little dispute over the background to the application.
[5] Miss McGuire worked for Crown on a regular casual basis for some eight and a half years. At the time of the termination of her employment she averaged 28 hours work per week as a Food and Beverage Attendant. There is nothing to indicate that Miss McGuire had any form of adverse disciplinary record.
[6] In June 2010 Miss McGuire participated in managerial policy and occupational health and safety training conducted by Crown. Whilst her signed endorsement of this training was delayed, there is no dispute as to the content of this training which included policy requirements and behaviours which could lead to termination of employment.
[7] On 23 October 2010 Miss McGuire was rostered to work from 4.30 pm until required. She reached agreement with Crown management to commence work 15 minutes late as she was distressed on her arrival at work. Miss McGuire has suggested that the reason for her distress was related to either or both a diabetic condition or an argument with her mother. She has not asserted that this reason explained her later behaviour on that day.
[8] Miss McGuire managed the Front (or Sports) Bar and did so primarily on her own. This function included the dispensing of drinks and attendance to patrons drinking within the bar area and an adjacent outside area. She was supervised by a duty manager who attended the bar from time to time. The bar area was covered by a video which could be reviewed by hotel management.
[9] At approximately 12.30 am Miss McGuire asked her Duty Manager, Mr Pittaway to commence to close the bar. This process was completed when the last patron left at around 1.30 am. Miss McGuire then moved to another part of the hotel. She signed off work around 2.00 am.
[10] On the following day, another staff member advised the then duty manager of customer complaints regarding Miss McGuire’s behaviour the previous evening. This duty manager then viewed part of the video from the previous night before contacting the hotel manager, Mr Bawden and advising him of the seriousness of the complaints and the extent to which they were at least partially verified by the video. Mr Bawden instructed that no action be taken with respect to Miss McGuire until he could attend to the matter the next day.
[11] Miss McGuire worked her normal shift later on that day.
[12] The following day, 25 October 2010, Mr Bawden viewed the video. He asked the Assistant Hotel Manager to participate in a meeting with Miss McGuire which occurred shortly after she arrived early for her nominated shift. At this meeting Mr Bawden put allegations to Miss McGuire to the effect that she had:
• smoked inside the hotel bar area,
• allowed patrons to be behind the bar and, on one occasion to dispense alcohol, and
• engaged in other, unspecified misconduct.
[13] Mr Bawden asserts that as Miss McGuire did not dispute these allegations she was then told that she could either resign or would be dismissed. Miss McGuire did not resign and was accordingly dismissed.
[14] Mr Bawden forwarded a letter confirming the termination of her employment on 25 October 2010. This letter stated:
- Smoking inside a licenced premises, a state regularity offence.
- Smoking on Company premises not on a designated break time.
- Consumption of alcohol during work hours.
- Misleading of trust, leaving working area unattended for periods of time while responsible for sums of money.
“Dear Megan McGuire
As of 25/10/10 your employment at the Crown Inn Hotel has been terminated for the reason of serious misconduct.
After a meeting with myself and tracy Barber today [25/10/10] we put to you that during your shift on Saturday the 23rd of October 2010 you were involved in the following:
All of the above are indicated in IPG’s Employee handbook company rules and policies and are listed as serious misconduct. Your failure to provide a reasonable expiation (sic) for your behaviour leaves us no alternative but to terminate your employment.
This communication represents your official letter of separation.
A separation certificate will be forwarded to you in the mail.
Regards
Derek Bawden
Venue Manager”
[15] Additionally, on 26 October 2010 the Crown central administration function provided written confirmation to Miss McGuire that, as her employment had been terminated for serious and wilful misconduct, she would not be paid any pro rata long service leave payment.
The Submissions
[16] Miss McGuire asserts that the termination of her employment was harsh, unjust or unreasonable on the basis that it lacked a valid reason, that she was not given the opportunity to respond, was not shown the video nor had access to a support person. Additionally, Miss McGuire asserts that Crown’s refusal to pay her pro rata long service leave was harsh.
[17] Crown asserts that the video evidence of numerous forms of misconduct confirmed multiple valid reasons for the termination of employment. Crown concedes that Miss McGuire was not shown the video nor offered a support person, but argues that Miss McGuire’s behaviour was such that the termination of employment could not be regarded as harsh, unjust or unreasonable.
The Evidence
[18] I was shown some 17 selected extracts from the video of the Sports Bar on 23 October 2010. Whilst there was no dispute about the authenticity of this video, the parties disagreed about the conclusions which I could draw from it.
[19] Miss McGuire gave evidence about the events of 23 October 2010 and the events which culminated in the termination of her employment on 25 October 2010. Her evidence and that of the other witnesses was given in a clear and creditable fashion.
[20] Ms Raybould was the Duty Manager at Crown on the day after the shift when the incidents involving Miss McGuire occurred. Her evidence went to the advice she received of complaints about Miss McGuire’s behaviour, her brief consideration of the video and subsequent contact with the Crown Manager, Mr Bawden.
[21] Mr Pittaway was the Duty Manager at the Crown on the evening of 25 October 2010. His evidence went to Miss McGuire’s late start and his supervision of the Sports Bar. On one occasion he observed a patron serving himself behind the bar and on other occasions he noticed that Miss McGuire was either not behind the bar and/or talking with patrons. Mr Pittaway’s evidence was that he confirmed to Miss McGuire that patrons should not be behind the bar. Mr Pittaway completed the closing of the bar tills and observed that Miss McGuire had not satisfactorily cleaned the bar.
[22] Mr Bawden is the Hotel Manager. His evidence relevantly went to his discussions with Ms Raybould on 24 October 2010 where he was advised of inappropriate behaviour on the part of Miss McGuire and his advice to Ms Raybould to take no action and that he would deal with the matter on 25 October 2010. On that next morning, Mr Bawden viewed the video and arranged for the Assistant Manager, Ms Barber to observe a meeting with Miss McGuire.
[23] Mr Bawden’s evidence went to the process he followed to terminate Miss McGuire’s employment.
[24] In addition to the evidence of the witnesses in this matter, I have taken into account the evidence in the form of Crown policies, including the training provided to Miss McGuire in June 2010 with respect to these policies.
Findings
[25] I am satisfied that none of the initial matters set out in s.396 are relevant to this application.
[26] I have concluded that the video of the shift worked by Miss McGuire on 23 October 2010 is authentic but that it is, in a number of respects, inconclusive.
[27] Section 387 states:
“387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWA 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 FWA considers relevant.”
[28] I have considered each of these factors.
Valid Reason
[29] In Selvechandron v Petersen Plastics Ltd 1 Northrop J stated:
“In its context in s.170DE(1), the adjective “valid” should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s.170DE(1). At the same time the reasons must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must “be applied in a practical, commonsense way to ensure that the employer and employee are treated fairly”.
[30] Notwithstanding that this decision reflected a different legislative regime which invited collective consideration of some other factors now separately identified in s.387, I have adopted this principle.
[31] Crown asserted that the evidence establishes that a number of Miss McGuire’s actions and behaviours on 23 October 2010 represented valid reasons for the termination of her employment. I have considered these actions individually and collectively.
Smoking in the Sports Bar
[32] The video twice shows Miss McGuire taking a cigarette from a bag and smoking it before leaving the bar area. Miss McGuire admits to this and acknowledges that smoking in the hotel is prohibited. She asserts that other staff go outside into designated areas to smoke outside of their specified breaks and that, when she became aware that she was smoking she did this. Miss McGuire has not identified circumstances where staff smoking in the hotel has been sanctioned by management. She acknowledges her completion of policy training in June 2010 where she identified smoking as an example of serious misconduct which could lead to termination of employment. She did not dispute that the policy was absolutely specific in its prohibition of smoking inside the hotel.
[33] South Australian legislation requires that the Hotel be a smoke-free environment and specifies fines for individuals and the Hotel if this requirement is breached.
[34] I have concluded that the two instances of smoking in the Sports Bar represent a valid reason for the termination of Miss McGuire’s employment.
Dispensing of drinks
[35] On up to 6 occasions the video showed drinks being dispensed to patrons without any apparent accompanying payment. Crown asserts that this represents serious misconduct. Miss McGuire advised that these drinks had been prepaid. I have no reason to disbelieve her in this respect and, as I consider there was no real opportunity for this issue to be thoroughly investigated prior to the termination of Miss McGuire’s employment, I am not satisfied that the Crown allegations in this respect have been made out such that Miss McGuire’s behaviour in these respects represents a valid reason for the termination of her employment. Had this issue been investigated with Miss McGuire such that the facts were established, I may well have reached a quite different conclusion about it.
Patrons behind the Bar
[36] The video shows one instance of a patron leaning over the bar to pour himself a drink, and two other occasions when patrons were behind the bar. I accept Mr Pittaway’s evidence that he saw a patron behind the bar and that he advised Miss McGuire that this was unacceptable.
[37] Miss McGuire concedes these events. She asserts that she did not approve these actions which were taken by patrons in a light-hearted manner. In these respects I consider Miss McGuire’s behaviour clearly represents misconduct in that it was fundamentally inconsistent with her role and had the potential to harm both herself and the hotel. Had the full circumstances of these incidents been investigated so as to establish Miss McGuire’s responsibility, this behaviour may well be described as serious misconduct. However, absent an investigation into the extent to which Miss McGuire was aware of these behaviours at the time and took appropriate action, in the context of the Crown’s policies and procedures, I am unable to describe this as serious misconduct warranting summary dismissal, as distinct from other disciplinary action.
Drinking alcohol
[38] The video showed two incidents where Miss McGuire appeared to drink from glasses taken from the bar area. One of these appeared to be a beer glass and one a different drink.
[39] Miss McGuire asserts that she tasted the beer following a patron’s complaint about its quality and that this reflected a normal process. Relative to the second incident, Miss McGuire asserts the liquid in the glass was not alcohol.
[40] The video does not allow a definitive conclusion in these respects. Again there is no evidence these matters were tested through discussions with Miss McGuire. On the evidence before me I am not satisfied that the Crown’s allegations have been made out or that these actions represent a valid reason for the termination of Miss McGuire’s employment.
Socialising
[41] Miss McGuire spent some time socialising with patrons. Crown asserts that she was away from the bar for excessive durations and that her behaviour with certain patrons was inappropriate.
[42] Miss McGuire disputes that her behaviour was inappropriate and argues her job function involves the collection of glasses such that she had to be away from the bar.
[43] The video indicates that Miss McGuire did spend time socialising with patrons. Whilst I am not able to discern that this time was excessive by normal hotel standards, it appears that toward the latter part of the evening, Miss McGuire spent significant time with a group of patrons. I have not concluded that her behaviour toward any of these patrons was inappropriate and, to the extent that she was away from the bar for excessive periods, the evidence before me does not enable a conclusion that this represented a valid reason for the termination of her employment, as distinct from other disciplinary action.
Mobile telephone use
[44] The video shows Miss McGuire accessing her mobile phone. Her evidence was that she did so in order to obtain a phone number so as to arrange for transport home. Again, this may represent misconduct but does not, of itself, form a valid reason for the termination of employment.
Failure to remain in uniform
[45] It is clear from the video that Miss McGuire completed her shift wearing different attire to that which she had on when she started. She concedes this and submits that she took off her uniform top after it became wet.
[46] I am not satisfied that in these circumstances, that this allegation was ever put to Miss McGuire, or that it could be regarded as misconduct let alone a valid reason for the termination of her employment.
Failure to properly clean the bar
[47] The evidence before me indicates that Crown management concluded that Miss McGuire had not properly completed her clean up of the bar area. I cannot conclude this allegation was even put to Miss McGuire, but in any event, it cannot be a valid reason for the termination of employment.
The allegations considered collectively
[48] Notwithstanding my conclusion with respect to Miss McGuire’s smoking in the hotel, I have considered whether all of the other allegations, taken collectively, represent a further valid reason for the termination of her employment. There are simply too many of these allegations that have not been satisfactorily proven or established as sufficiently serious such that, with the exception of the smoking allegation they represent a valid reason for the termination of Miss McGuire’s employment.
Notification of the Reason
[49] I am satisfied that, in the discussion on 25 October 2010 Mr Bawden advised Miss McGuire that one of the reasons for the termination of employment related to her smoking in the bar area. I consider that the other factors relied upon to effect the termination of her employment were so generally stated such that Mr Bawden’s explanation of the reasons for her dismissal were not clear.
[50] However, the letter of 25 October 2010 which confirmed the termination of Miss McGuire’s employment is clear in its additional reference to the consumption of alcohol and absences from the work area.
[51] Consequently, to the extent that Crown placed fundamental emphasis on the smoking allegations, the reason for the termination of Miss McGuire’s employment was notified to her.
Opportunity to Respond
[52] I have concluded that Miss McGuire was not given any real opportunity to respond to the allegations put in summary form to her. She was not invited to view the video and a number of the allegations were put to her in such a summary form that they did not enable a proper response.
[53] Further, I have concluded that, to a substantial extent, Mr Bawden had already decided to dismiss Miss McGuire before he met with her on 25 October 2010.
Unreasonable refusal to allow Miss McGuire a support person
[54] There is no evidence that Miss McGuire asked to have a support person present at the 25 October 2010 interview at which her employment was terminated.
[55] Notwithstanding this, Mr Bawden arranged to have a witness present from a management perspective.
[56] I am not satisfied that Miss McGuire was made aware that the meeting on 25 October 2010 could result in the termination of employment such that she could identify the need for a support person. Accordingly, this factor is indicative of unfairness in the termination of employment process.
Unsatisfactory Performance
[57] To the extent that Crown relied on a range of behaviours as the basis for the termination of Miss McGuire’s employment, I have noted that there is no indication that she had ever been previously warned with respect to her employment actions.
Size of the employer’s enterprise
[58] On the evidence before me I have concluded that Crown is a substantial employer, operating a number of hotel establishments. Its policies and procedures appear to reflect this significant size.
Absence of dedicated Human Resource Management expertise
[59] There is no evidence of a dedicated human resource management resource within Crown other than its occupational health and safety and employee policies and procedures. However, I have concluded that Crown is of a size where human resource management expertise would be available if it was considered necessary. There is no evidence that this was the case in this situation.
Other matters considered relevant.
[60] Miss McGuire had worked for Crown for some 8½ years. In this industry I consider this to be a substantial period of time and that she was entitled to expect some latitude relative to minor misdemeanours.
[61] Even more significantly, on 24 October 2010 Mr Bawden was advised of the seriousness of at least some of the allegations against Miss McGuire with respect to her work on the previous evening and nevertheless elected to allow her to continue to work her rostered shift on that day. That Crown allowed this to happen is inherently inconsistent with the decision taken the following day to immediately dismiss her on the basis of her behaviour on 23 October 2010.
[62] I have also noted that the Crown policy position is that smoking in the hotel may result in termination of employment rather than being certain to do so. Further, the Crown policies provide the capacity for suspension pending the results of an investigation 2 and that they specify:
“....
All allegations of serious misconduct will be fully investigated and the employee will be given an opportunity to respond before any decisions are made.”
[63] I have concluded that Crown failed to apply its own policy in that it failed to fully investigate the allegations. Any such investigation must necessarily allow for participation by Miss McGuire
[64] Further, Crown failed to suspend her when the allegations became known to Mr Bawden the next day, and its sanctioning of her continued work was inconsistent with allegations of serious misconduct made against her.
[65] I have noted that Miss McGuire believes that Crown’s refusal to pay her pro rata long service leave on the basis that her employment was terminated on the grounds of serious and wilful misconduct, represents an unfairness. I have not taken the issue of payment of pro rata long service leave into account as the enforcement of that legislation is not within this jurisdiction. I have obviously, however, considered the allegations made against Miss McGuire.
[66] Finally, I have noted that, as a casual employee, Miss McGuire does not accrue rights under the National Employment Standard with respect to termination of employment payments and notice.
Conclusion - Harsh, Unjust or Unreasonable
[67] I consider that Miss McGuire’s two instances of smoking in the bar area can only be described as serious and wilful misconduct and that, as such, they represented a valid reason for the termination of her employment. I am not satisfied that the other allegations against Miss McGuire have been established as serious and wilful misconduct or that, on the evidence before me, they represented valid reasons for the termination of her employment.
[68] I consider that the process followed to effect the termination of Miss McGuire’s employment and the fact that Miss McGuire was allowed to continue to work after management became aware of the allegations lack consistency and fairness in the sense of “a fair go all round” referenced in s.381.
[69] I have considered the extent to which, notwithstanding the procedural failings associated with the termination of Miss McGuire’s employment, her conduct was such that it warranted dismissal. Whilst the termination of her employment was a likely outcome irrespective of the process followed, that process was so flawed that I am persuaded that the termination of Miss McGuire’s employment was unjust. Had Miss McGuire not been allowed to work on the day following the incident, I may well have concluded otherwise. I do not consider the dismissal to be harsh because Miss McGuire had acknowledged, in the training process, some four months earlier, that smoking in the hotel was serious misconduct. I do not consider the penalty of termination of employment to be unreasonable because of the legislative obligations on Crown and its policy position.
Remedy
[70] Consequent upon a finding that the termination of Miss McGuire’s employment was unjust, s.390 requires the initial consideration of the primary remedy of reinstatement.
[71] Miss McGuire has subsequently gained other employment. She does not seek reinstatement and, whilst the Crown position in this respect has not been clearly articulated, I am satisfied that reinstatement would be inappropriate given the relationship of the parties and that the likelihood that any reinstatement would be of a short duration.
[72] Section 390 then provides that Fair Work Australia may order compensation if this is appropriate. I am satisfied that a limited amount of compensation is appropriate.
[73] Section 392(2) states:
“392 Remedy—compensation
Compensation
(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.
Criteria for deciding amounts
(2) In determining an amount for the purposes of an order under subsection (1), FWA must take into account all the circumstances of the case including:
(a) the effect of the order on the viability of the employer’s enterprise; and
(b) the length of the person’s service with the employer; and
(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and
(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and
(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and
(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and
(g) any other matter that FWA considers relevant.”
[74] I am satisfied that the amount being considered is not likely to affect the viability of Crown.
[75] I have noted Miss McGuire’s 8½ years service with Crown and consider this to be a reasonably substantial employment period in this industry.
[76] Had Miss McGuire not been dismissed I expect that she would have been given a final warning. On the basis of her employment history, I have no reason to expect that she would have repeated this behaviour and hence would have continued to work for Crown indefinitely.
[77] Miss McGuire advised that, after the termination of her employment, she applied for other jobs and obtained employment in the hospitality industry some six weeks before the hearing. She provided little evidence however, of the extent to which she had actively pursued other work. I have discounted the amount to be ordered on this basis.
[78] I have taken into account the income earned by Miss McGuire in her new employment which I have taken to be of a regular nature.
[79] Finally, in terms of other matters considered relevant, Miss McGuire’s own behaviour was serious and wilful and directly led to the termination of her employment. I have significantly discounted the amount of compensation accordingly.
[80] Having taken all of these issues into account, I have determined that an amount of compensation equating to 4 weeks pay on the basis of Miss McGuire’s average of 28 hours worked per week is appropriate. An Order (PR508706) to this effect will be issued.
SENIOR DEPUTY PRESIDENT
Appearances:
M McGuire on her own behalf.
T Evans representing Independent Pub Group Pty Ltd T/A Crown Inn Hotel
Hearing details:
2011.
Adelaide:
April 11.
1 (1995) 62 IR 371 at 373
2 Exhibit P4, page 15
Printed by authority of the Commonwealth Government Printer
<Price code C, PR508707>
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