Meredith Docherty v Barsar Pty Ltd Stevenson Family Trust T/A Fancy Fillings Greensborough

[2014] FWC 2583

[2014] FWC 2583

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Meredith Docherty
v
Barsar Pty Ltd Stevenson Family Trust T/A Fancy Fillings Greensborough
(U2013/16441)

COMMISSIONER BLAIR MELBOURNE, 16 APRIL 2014

Application for relief from unfair dismissal.

[1] This matter is an application made under s.394 of the Fair Work Act 2009 (the Act) by Ms Meredith Docherty (the Applicant). The respondent to the application is Barsar Pty Ltd Stevenson Family Trust t/a Fancy Fillings Greensborough (the Respondent).

[2] The following decision (now edited) was handed down in transcript at a hearing which took place on Thursday 7 April 2014.

[3] “The parties need to understand that the Commission operates on the balance of probabilities. It doesn't operate the same as a Court where it's got to be beyond a reasonable doubt. We operate on the standard of balance of probabilities.

[4] I previously indicated to the parties that in making a decision I have to take one side as against the other. There's no win/win here. The only way there's a win/win is if the parties had agreed to settle and move on, but that didn’t happen. I have to make a decision as to who I believe and that goes to the statements that have been provided, the evidence that's been given, and also the credibility of the people who have given that evidence.

I don't question the credibility of either the Applicant or the Respondent, but there is obviously a conflict between what's alleged to have been said and, what's clouded all of this is unfortunate breakdown of the Respondent’s marriage. That has had an impact upon the relationship between the Applicant and the Respondent.

[5] What I have to do though is look at the Act. Section 386 of the Act states:

386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

(2) However, a person has not been dismissed if:

(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season; or

(b) the person was an employee:

(i) to whom a training arrangement applied; and

(ii) whose employment was for a specified period of time or was, for any reason, limited to the duration of the training arrangement;

and the employment has terminated at the end of the training arrangement; or

(c) the person was demoted in employment but:

(i) the demotion does not involve a significant reduction in his or her remuneration or duties; and

(ii) he or she remains employed with the employer that effected the demotion.

(3) Subsection (2) does not apply to a person employed under a contract of a kind referred to in paragraph (2)(a) if a substantial purpose of the employment of the person under a contract of that kind is, or was at the time of the person’s employment, to avoid the employer’s obligations under this Part.

[6] In stating at s.386(2)(c) that that is not a dismissal the reverse has to be said; that is, if there is a demotion and there is a reduction in the person's remuneration that it is a dismissal.

[7] Further, s.385 of the Act states, in particular s.385(c):

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.

[8] I think, on the balance of probabilities, if there was a discussion concerning the performance of the Applicant, it was not abundantly clear to the Applicant that her performance may result in either termination or demotion. I'm satisfied that that was not abundantly clear.

[9] Having taken those two things into account I find that actions of the Respondent did constitute a termination of employment, because the Applicant was to suffer a reduction in remuneration and her hours of work. And that termination of employment was at the instigation of the employer.

[10] Was there a valid reason for the termination of employment? The Commission determines that there was a valid reason based on the deteriorating financial position of the Respondent.

[11] The Commission now turns its mind to the issue of whether or not the termination was harsh, unjust and unreasonable. I find that the termination was harsh in that, on the balance of probabilities, the Small Business Fair Dismissal Code was not complied with.

[12] I find that the termination was unreasonable in that there was a demotion and a substantial reduction in remuneration. Also, although the actions of the employer were not intentional, I think they were unreasonable.

[13] One then looks at the issue of remedy. Obviously, reinstatement is not sought and would be impossible anyway because the business has been sold.

[14] Therefore, the issue is of compensation. Section 392(2) of the Act states:

Criteria for deciding amounts

(2) In determining an amount for the purposes of an order under subsection (1), the FWC 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 the FWC considers relevant.

[15] In relation to s.392(2)(a), the business no longer exists so the Commission must take into account the effect on the Respondent, if any. As I understand it, the Applicant commenced employment in August 2011 and finished on 24 November 2013, so just over two years’ service.

[16] In relation to s.392(2)(c), I am satisfied that if the Respondent had complied with the Small Business Fair Dismissal Code the Applicant’s employment would not have lasted any more than one month.

[17] In relation to s.392(2)(d), the Applicant indicated that she has sought to try and find alternative employment on numerous occasions, with the Christmas period being a very difficult period, but also following the Christmas period.

[18] In relation to s.392(2)(e), the Applicant indicates that she's earned approximately $600 and in relation to s.392(2)(f), the Applicant indicates that she is currently working casually for approximately seven to eight hours per week at the rate of $14 per hour.

[19] Finally, in relation to s.392(2)(g), I consider that there are no other matters that should be taken into consideration.

[20] Having what I've said in addressing the points 392(2)(a) to (g), I would determine that the Applicant be paid four weeks’ pay at the rate of $790 per week nett, less any moneys that have been earned. In the Commission's view, the amount would be $2560 nett, to be paid within a period of four weeks from today’s date, 7 April 2014.

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