Michael DonovanvHowden Australia Pty Ltd

[2013] FWC 9383

[2013] FWC 9383

FAIR WORK COMMISSION

CORRECTION TO DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Michael Donovan
v
Howden Australia Pty Ltd
(U2013/5653)

SENIOR DEPUTY PRESIDENT HAMBERGER SYDNEY, 28 NOVEMBER 2013

Correction to PR544167[2013] FWC 8700.

[1] This decision wholly replaces decision [2013] FWC 8700 PR544167 issued by me on 14 November 2013.

[2] On 14 January 2013 Mr Michael Donovan made an application to the Fair Work Commission (FWC) for an unfair dismissal remedy in accordance with s.394 of the Fair Work Act 2009 (the FW Act) in relation to the termination of his employment by Austcold Refrigeration Pty Ltd (Austcold) on 20 December 2012. Mr Donovan was unrepresented at the time he made his application. A conciliation conference was held on 14 February 2013 but was unsuccessful. The matter was referred for arbitration and was heard on 1 July 2013. Mr Donovan was represented at the hearing by Mr C Bolger, of counsel, instructed by Mr M Ghobrial, solicitor. The respondent was represented by Ms E Brus, of counsel, instructed by Ms A Ford, solicitor.

[3] The Commission issued its decision on 24 July 2013 dismissing Mr Donovan’s application. 1

[4] On 5 August 2013, Austcold made an application for a costs order against Mr Donovan.

[5] Austcold’s application identified the following grounds for a costs order:

‘On 24 July 2013, Senior Deputy President Hamberger handed down a decision which determined that Michael Donovan’s (“Mr Donovan”) dismissal was not harsh, unjust or unreasonable and dismissed his application for unfair dismissal remedy.

Austcold Refrigeration Pty Ltd (“Austcold”) makes this application in accordance with Section 402 of the Fair Work Act 2009.

Austcold seeks a costs order against Mr Donovan in accordance with Section 400A of the Fair Work Act 2009, on grounds that Mr Donovan’s actions in rejecting numerous attempts by Austcold to resolve Mr Donovan's unfair dismissal application, specifically his actions in rejecting reasonable settlement offers put forward by Austcold, was unreasonable and his unreasonable actions caused Austcold to incur unnecessary costs.

The attempts made by Austcold to resolve Mr Donovan's unfair dismissal application and Mr Donovan's responses are as follows:

On 18 March 2013, Austcold instructed their Lawyers ("Coleman Greig") to write to Mr Donovan's Lawyers ("Ghobrial Legal") and put forward an offer for Austcold to pay Mr Donovan 8 weeks salary less applicable tax.

On 19 March 2013, Ghobrial Legal wrote to Coleman Greig rejecting Austcold's offer and put forward a counter offer for Austcold to pay Mr Donovan 16 weeks salary less applicable tax.

On 3 April, Coleman Greig verbally conveyed to Ghobrial Legal an offer for Austcold to pay Mr Donavan 12 weeks salary less applicable tax.

On 4 April 2013, Ghobrial Legal verbally rejected Austcold's offer to pay Mr Donovan 12 weeks salary less applicable tax.

On 5 April 2013, Coleman Greig wrote to Ghobrial Legal and put forward an offer for Austcold to pay Mr Donovan 16 weeks salary less applicable tax.

On 8 April 2013, Ghobrial Legal contacted Coleman Greig and verbally sought clarification as to whether Austcold's offer to pay Mr Donovan 16 weeks salary was based on a 40 hour week with the hourly rate being $35.50.

On 9 April 2013, Coleman Greig contacted Ghobrial Legal and verbally conveyed that Austcold's offer to pay 16 weeks was based on a 38 hour week with the hourly rate being $35.50.

Later that day, Ghobrial Legal, verbally communicated to Coleman Greig that Mr Donovan sought payment of 16 weeks from Austcold based on a 40 hour week with the hourly rate being $35.50.

On 11 April 2013, Coleman Greig wrote to Ghobrial Legal and put forward an offer for Austcold to pay Mr Donovan 16 week’s salary based on a 40 hour week with the hourly rate being $35.50, subject to Mr Donovan providing Austcold with a full release from any further claims in relation to his employment with Austcold.

On 15 April, Coleman Greig wrote to Ghobrial Legal and put forward two alternate offers for consideration; the first was for Austcold to pay Mr Donovan 16 weeks salary based on a 38 hour week at an hourly rate of $35.50 and for Mr Donovan to provide Austcold with a partial release from any further claims in relation to his employment with Austcold, and the second was for Austcold to pay Mr Donovan 16 weeks salary based on a 40 hour week at an hourly rate of $35.50 and for Mr Donovan to provide Austcold with a full release from any further claims in relation to his employment with Austcold.

Later that day, Ghobrial Legal wrote to Coleman Greig rejecting both offers.

No further offers of settlement were made by the Applicant prior to the hearing.’

[6] The Commission issued directions on 7 August 2013 for written submissions and indicated that the application for costs would be determined ‘on the papers’.

Consideration

[7] The application is made under s.402 of the FW Act, and seeks a costs order in accordance with s.400A of the FW Act.

[8] Section 402 states:

‘An application for an order for costs under section 611 in relation to a matter arising under this Part, or for costs under section 400A or 401, must be made within 14 days after:

(a) the FWC determines the matter; or

(b) the matter is discontinued.’

[9] The application was made within 14 days after the decision dismissing Mr Donovan’s application for an unfair dismissal remedy.

[10] Section 400A states:

‘1) The FWC may make an order for costs against a party to a matter arising under this Part (the first party) for costs incurred by the other party to the matter if the FWC is satisfied that the first party caused those costs to be incurred because of an unreasonable act or omission of the first party in connection with the conduct or continuation of the matter.

(2) The FWC may make an order under subsection (1) only if the other party to the matter has applied for it in accordance with section 402.

(3) This section does not limit the FWC’s power to order costs under section 611.’

[11] Section 400A was inserted into the FW Act by Part 3 of Schedule 6 of the Fair Work Amendment Act 2012 (‘the amending Act’). Schedule 6 of the amending Act was proclaimed to commence on 1 January 2013. Schedule 11 of the amending Act deals with application, transitional and savings provisions. It added ‘Schedule 3 - Amendments Made by the Fair Work Amendment Act 2012’ to the end of the FW Act. Section 12 of Schedule 3 of the FW Act states:

‘The amendments made by Part 3 of Schedule 6 to the amending Act (which is about costs orders against parties) apply in relation to dismissals that take effect after the commencement of that Part.’

[12] Mr Donovan’s dismissal took effect on 20 December 2012. Section 400A, relied on by Austcold, only applies in relation to dismissals that took effect after 1 January 2013. Accordingly it cannot apply to Mr Donovan’s dismissal. Austcold’s application for a costs order is accordingly dismissed.

SENIOR DEPUTY PRESIDENT

Final written submissions:

5 September 2013

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