Miller v Koornang Pty Ltd T/A Rosstown Hotel

[2010] FWA 3123

[2010] FWA 3123

FAIR WORK AUSTRALIA

DECISION

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

Miller
v
Koornang Pty Ltd T/A Rosstown Hotel
(U2009/12785)

COMMISSIONER WHELAN MELBOURNE, 23 APRIL 2010

Application for unfair dismissal remedy.

[1] This is an application by Mr Miller under section 394 of the Fair Work Act 2009. Mr Miller contends that the termination of his employment by the respondent was unfair. The respondent contends that there was a valid reason for the termination and that it was not otherwise harsh, unjust or unreasonable.

[2] Evidence was given by Mr Miller and by Ms Kerr, Ms Mirabella and Ms Hollingworth on his behalf. Evidence for the respondent was given by Mr Nikakis, Ms McDonald, Ms Homer, Ms Wilkins, Ms Cudden and Mr Hambling.

Background

[3] Mr Miller was employed by the respondent as a hotel duty manager. He was dismissed as a result of certain events which occurred on 26 and 27 September 2009 while he was the duty manager responsible for the supervision and closing down of all areas of the hotel with the exception of the gaming room and (according to Mr Miller, but not Mr Nikakis) the sports bar.

[4] There is not a great deal of dispute about what occurred between 10.00 p.m. on the Saturday night and 2.30 a.m. on the Sunday morning. Ms Kerr, who had finished work at about 7.00 p.m. and Ms Hollingworth who finished at about 10.00 p.m. were planning to attend a party for one of the other staff members. Mr Miller was going to drive them there. They left the hotel at the finish of their shifts and returned at about 10.30 p.m. to the bistro bar.

[5] Ms Mirabella was also on duty that night and after finishing work at 10.10 p.m. she remained at the hotel. She was given a beer by Ms McDonald who was on duty in the bistro bar. When she finished work Ms McDonald joined the other staff members who were drinking in the bistro bar. They were joined by Ms Toniazzo after she had finished work in the main bar.

[6] Mr Miller joined the group at about 10.50 p.m. after pouring himself a beer. In all, the employer’s evidence was that 10 beers were poured and not accounted for between 10.16 p.m. and 11.34 p.m. Further at about 2.07 a.m. on the Sunday morning Mr Miller poured himself a spirit which he did not pay for.

[7] At some stage during the course of the evening the employees moved from the main bistro area to the corner bar where Mr Miller, Ms Mirabella, and Ms McDonald were drinking and smoking cigarettes. Mr Hambling who at the relevant time was not an employee of the respondent, was at home with Mr Cavanagh when the latter received a text message inviting them back to the hotel. He went to the hotel where he was given a beer by Mr Miller and then purchased additional drinks from the bottle shop.

[8] Ms Kerr and Ms Hollingworth, on arriving at the hotel had purchased drinks from the bottle shop which they put in the fridge behind the bistro bar. Ms Hollingworth, at his request, also purchased four stubbies of bourbon and coke from the bottle shop for Mr Miller. He consumed these in the course of the evening.

[9] At about midnight the bottle shop was closed and the casual employees gave the takings and keys to Ms Homer, the gaming room manager. She put the takings into the office but as she did not have access to the safe she left the money on the filing cabinet, advised Mr Miller the money was there and alarmed the bottle shop.

[10] There is some dispute about Mr Miller’s responsibility for the closure of the main bar on that night. It is agreed that he told Ms Toniazzo to call last drinks. She was assisted by security to clear the bar. Mr Miller then emptied the tills and put the money in a locked cupboard in the bistro bar. He then alarmed the main bar.

[11] At about 1.00 a.m. on the Sunday morning, Ms Kerr’s boyfriend and shortly after Ms Hollingworth’s boyfriend arrived to take them home. They were let into the hotel through a side door by one of the staff using a key kept behind the bar. They did not have a drink while they were on the premises.

[12] Shortly after 2.00 a.m., after pouring himself a drink, Mr Miller placed the money Ms Homer had left on the filing cabinet into the safe, along with the takings from the bistro and the main bar. He alarmed the hotel and left the premises.

[13] Mr Miler did not work again until Tuesday 29 September. On arrival at work he paid for the bourbon he had drunk at about 2.00 a.m. on Sunday morning.

[14] On Monday 28 September, Mr Nikakis, director and licensee of the hotel, was informed by a patron that he had seen staff drinking and smoking in the corner bar area after the hotel had closed on 26 September. They were visible from the street. Mr Nikakis commenced an investigation by viewing the CCTV footage from that evening. He observed staff (including Mr Miller) pouring beers which were not rung up or paid for and Mr Miller drinking and smoking while on duty. The footage was supported by the till computer which showed that 10 beers and one spirit had been poured but not rung up.

[15] On Wednesday 30 September, shortly after he arrived at work, Mr Nikakis asked Mr Miller to attend a meeting. Also present was Ms Wilkins.

[16] Mr Nikakis raised with Mr Miller that he had been drinking on duty on Saturday night when he was responsible for locking down, alarming and securing the day’s takings for bars and the bottle shop. He raised the issue of staff helping themselves to drinks and Mr Miller letting staff bring drinks into the bistro area and use the bar fridge. He also raised staff letting people in and out of the Dandenong Road exit when the area was supposed to be locked down. He further raised the fact that Mr Miller had not checked that the bottle shop was properly locked down at midnight and had allowed takings to be left in an office unsecured for over two hours.

[17] Mr Nikakis referred to the fact that the hotel was under scrutiny from the Liquor Licensing Authority and that they were expecting another visit from them. Mr Nikakis asked Mr Miller if he had anything to say about the matters raised and Mr Miller responded that he had paid for the bourbon and coke. Mr Nikakis then adjourned the meeting. He and Ms Wilkins went to the office and Mr Miller went behind the bar in the bistro.

[18] Mr Nikakis discussed the issue with Ms Wilkins and expressed the view that Mr Miller was not giving him much option. He asked Ms Cudden to type a letter of termination and told Ms Wilkins that if he (Mr Miller) could not come up with any reasons for his actions, that is what would result.

[19] The meeting reconvened and Mr Nikakis asked Mr Miller if he had anything more to add. Mr Nikakis said that Mr Miller had nothing to say. Ms Wilkins could not recall Mr Miller saying anything. It was Mr Miller’s evidence that he said, ‘It was probably a bit of lacking judgement on my behalf’. Mr Nikakis then gave Mr Miller the letter saying he had no choice but to dismiss him.

[20] A number of matters were in dispute between the applicant and the respondent. These related specifically to the extent of Mr Miller’s responsibility on the night in question, the hotel’s policy on free drinks for staff members and the extent to which smoking on the premises was tolerated.

[21] Mr Nikakis produced a copy of the Rosstown Hotel policies and procedures manual which is provided to all employees as part of the induction process. 1 Mr Miller agreed that he was responsible for the induction of staff and that he provided new staff with a copy of the manual. Mr Miller stated that he read the manual when he started and assumed that it was updated but he had not read the manual again since.

[22] The manual deals with both ‘smoking’ and ‘staff drinks’.

[23] Under the heading ‘Smoking’ it states, ‘Staff rostered to work in the bar, bistro or floor shifts are permitted to smoke in their breaks in the designated staff smoking areas only’ and under the heading ‘Staff Drinks’ it states, ‘If staff wish to have an alcoholic drink when they have finished their shift for the day, you must be out of uniform and must pay the normal prices for all beverages consumed. Staff must use a table or lounge area’. 2

[24] It was Mr Miller’s evidence that the policy with regards to ‘knock off drinks’ was that it was a matter for the manager’s discretion. He agreed that in 2007 there was a no ‘knock off’ drinks’ policy but stated that towards the end of 2008 Mr Nikakis had told him and Ms Wilkins that knock off drinks were a matter for the manager’s discretion. Both Mr Nikakis and Ms Wilkins denied this.

[25] Mr Miller’s evidence was that he, and other managers, had exercised this discretion. He referred to Ms Wilkins providing drinks to sports bar employees, and Dan Wilkins providing drinks on Thursday nights to other employees. He denied giving staff approval to help themselves to drinks on the evening of 26 September 2009.

[26] In cross-examination Mr Miller admitted that Dan Wilkins was in charge of a promotional night know as Uni-Nite where free drinks were provided for promotional purposes. He agreed that these drinks were recorded and accounted for.

[27] In her evidence Ms Kerr stated that she had received free drinks when she had gone in after work or on other occasions when she had visited the hotel. In cross–examination she stated that she had been given free drinks by Mr Miller and by Dan Wilkins and Ryan Sweeney who both worked on the Uni–Nite. She agreed that from about the middle of the 2007 she was aware that ‘knock off’ drinks were not allowed.

[28] Ms Mirabella also stated that she had been given free drinks by Mr Miller and by Dan Wilkins and Ryan Sweeney. Mr Nikakis also gave staff a free drink on Christmas Day. That was the only occasion on which she received a free drink from Mr Nikakis. Ms Mirabella said that she received the policy manual when she started but had not read it. She was not aware that the policy manual prohibited ‘knock off’ drinks. She was not aware whether on other occasions when she had received free drinks that these had been accounted for by the manager.

[29] Ms Hollingworth’s evidence was that she had received free drinks on other occasions from Mr Miller and also from Dan Wilkins and Ryan Sweeney. She understood that the policy was that ‘knock off’ drinks were not a right but it was okay if the manager gave permission. She understood that the manual said that staff who attended the hotel when they were not working were not to be in uniform and were to pay for their own drinks.

[30] Mr Nikakis gave evidence that there were no ‘knock off’ drinks allowed. Managers had a discretion to purchase drinks for customers or for promotional purposes, such as Uni–Nite and on Christmas Day he purchased one drink each for the staff who had worked on that day. Prior to 2007 there had been ‘knock off’ drinks but the policy was changed and this was reflected in the manual.

[31] Ms MacDonald’s evidence was that she had received free drinks from managers before however they were rung up on the till. She was aware that it was against hotel policy to be drinking and smoking in the pub on that night. It had also happened on other occasions.

[32] Ms Wilkins’s evidence was that sometimes if a good employee had done a hard day’s work she would buy them a drink. The drinks were rung up and signed for.

[33] On the issue of smoking Mr Miller stated that he thought it was alright to smoke in the bar once it was closed to the public. He also claimed that other employees, including Ms Wilkins smoked in the hotel and so did Mr Nikakis’s mother.

[34] Mr Nikakis gave evidence that his mother had an upstairs office at the hotel. There are two balcony doors and a small balcony attached to the office. Mrs Nikakis always has the doors open when she is smoking. If 25% of the wall space is open, which it is when the doors are open, you are allowed to smoke in that area. Mr Nikakis never gave staff permission to smoke anywhere apart from the designated smoking area. He agreed that compliance with smoking regulations was not a matter for the Liquor Licensing Commission but felt that they would look at a breach of these regulations very dimly.

[35] Ms Wilkins stated that she occasionally had a cigarette in the designated smoking area in the Main Bar in the morning before it opened. She agreed that this at times happened before the shutters had gone up.

[36] It was not contested that Mr Miller was responsible for securing the takings from the main bar, bistro bar and bottle shop and ensuring these areas of the hotel were closed down and alarmed. Nor was it denied that he did not finish work until after 2.00 a.m. when he secured the takings in the safe and alarmed the hotel, other than the gaming area.

[37] Mr Miller denied that he was responsible for closing the main bar but agreed that he was responsible for ensuring that it was alarmed and the takings secured. He agreed that it was his responsibility to send the casual bottle shop staff home and to secure the takings and alarm the bottle shop and that he did not do this on the night in question.

[38] He believed that the money was secure because it was in a locked office but agreed that he should have put it in the safe. Mr Miller, at the time of the hearing was still of the view that there was not anything particularly wrong with his behaviour on the night of 26 September.

Submissions

[39] Mr Hollingworth referred to Mr Miller’s good employment record prior to 26 September and to the fact that Mr Nikakis had regarded him as a valued member of staff.

[40] He submitted that the practice of giving staff free drinks was not confined to Mr Miller and Ms Wilkins in her evidence said that she did it from time to time. Evidence has also been provided of other instances of smoking in the hotel, including by Ms Wilkins. Singling out Mr Miller in those circumstances was therefore harsh.

[41] Mr Miller attended work on 30 September. He was not advised of the purpose of the meeting he was called to around 10.00 a.m. He was clearly unaware that there was any problem. Mr Miller has admitted that he made errors in not recording the drinks he gave to staff. It did not however justify summary termination of his employment.

[42] Mr Miller was not warned that his employment might be terminated. He was not advised that he could have a support person. Mr Nikakis did not follow the procedure set out in the respondent’s policies and procedures manual. He was not afforded procedural fairness. Mr Miller was dismissed for serious misconduct and other employees who were present and also smoking and drinking were not even formally warned.

[43] Mr Hollingworth referred to the decision in Delany v Parramatta Leagues Club. 3

[44] Ms Duffy referred to the provisions of section 387 of the Fair Work Act. She submitted that there was a valid reason for the termination.

[45] The first was drinking on duty. Mr Miller had at least seven drinks when he was on duty and had not secured the takings from the bottle shop and had not closed up and alarmed the hotel.

[46] Second, Mr Miller did not follow the proper procedures for closing either the main bar or the bottle shop, both of which fell within his responsibility. The bottle shop takings were left unsecured until 2.24 a.m.

[47] Third, Mr Miller smoked a number of cigarettes in the bar and allowed others to do so in clear view of Dandenong Road. This is not comparable to smoking in a designated smoking area.

[48] Fourth, Mr Miller allowed people, some of whom where not staff, to enter and exit the building through a side door of the venue that should have remained locked. The takings and the float for the main bar and bistro were in a cupboard not far from that door.

[49] Lastly, Mr Miller provided staff with drinks without recording or paying for those drinks. There is no doubt what the policy was in relation to ‘knock off’ drinks or any free drinks provided to staff or others. Other managers may have given staff and others free drinks as part of a promotional event or on Christmas Day or for some other reason but these drinks were accounted for and recorded. Mr Miller made no attempt to account for the beers given away on 26 September. He only recorded and paid for the bourbon and coke a few days later. He allowed staff to pour drinks, which meant he could not know how many were poured. At least one drink was given to a person, Mr Hambling, who was not an employee of the respondent.

[50] Mr Miller also allowed staff to purchase drinks from the bottle shop and put them in the bar fridge. It was therefore not possible to know what was stock and what was purchased by the employees.

[51] Mr Nikakis had several valid reasons for terminating Mr Miller’s employment. Mr Nikakis conducted an investigation using CCTV footage and the bar cash register records. He decided to meet with Mr Miller the next day to put those things to him. Mr Miller did not ask for a support person. Mr Nikakis put the matters to him. He adjourned the meeting to give Mr Miller an opportunity to think about it before he made a response. It was his evidence that he was hoping that he would not have to dismiss Mr Miller. Mr Miller did not present any mitigating factors or explain his behaviour unless saying it was a lack of judgement on his part provided any explanation.

[52] The employer’s policy on serious misconduct is consistent with the Fair Work Regulations. The conduct was of a serious nature and showed disregard for the essential obligations of Mr Miller’s employment. Ms Duffy referred to Laws v London Chronicle, 4 North v Television Corporation Limited5 and Rankin v Marine Power International.6

[53] Mr Miller was effectively Mr Nikakis’s second-in-charge. He had a responsibility to adhere to the hotel’s policies and to ensure that the other staff did also. The conduct also occurred in the context of Mr Miller being aware that the hotel was under scrutiny from the Liquor Licensing Authority. The other employees involved were relatively junior employees. Two of them have been given a verbal warning by Mr Nikakis.

[54] During the course of the meeting on 30 September, Mr Miller admitted to the matters put to him. He had no real explanation for his behaviour. His view of the events has not really changed five months later.

Conclusions

[55] The matters which this Tribunal must take into account in considering if the applicant’s dismissal was harsh, unjust or unreasonable are set out in section 387 of the Act. The first of these is whether there was a valid reason related to the applicant’s conduct.

[56] The applicant was a senior and trusted member of the respondent’s staff. He was responsible for the induction and supervision of other employees and for the security of the premises and the money taken by the respondent in the course of its business.

[57] On the evening in question, with the exception of the gaming area, he was responsible for the responsible service of alcohol, for ensuring that the respondent’s licensing requirements and other legal obligations were met and that reasonable policies and procedures were followed.

[58] I am satisfied that he fell down on a number of these requirements.

[59] The employer’s policy with respect to staff drinks is set out in the policy manual. Mr Miller should have been aware of its contents. Apart from that policy I am satisfied that managers did have a discretion to provide free drinks for promotional and other purposes from time to time, so long as these were properly recorded and accounted for. On the evening in question Mr Miller not only failed to account for any of the drinks he provided to himself, other staff members and Mr Hambling, but he allowed members of staff to pour themselves drinks without these being recorded or otherwise accounted for. This seems to have occurred both before and after the till in the bistro bar was closed.

[60] Further, Mr Miller allowed staff to purchase drinks from the bottle shop and place them in the bistro bar fridge and to then consume those drinks on the premises. He in fact did this himself. It is not put by the respondent that employees who did this also consumed drinks which were not paid for but it would have been difficult for Mr Miller to ensure that this did not occur.

[61] While on duty and responsible for the security of the premises and the takings Mr Miller was himself drinking and smoking with the off duty employees. In doing so he took minimal responsibility for the closure of the main bar and none for the closure of the bottle shop, both of which were his responsibility. Further, he allowed money which should have been secured in the safe to be left on a filing cabinet for over two hours and left money in a cupboard in the bar near a door where members of the public were being let in and out of the hotel.

[62] In my view there were serious breaches of Mr Miller’s responsibilities as a duty manager.

[63] Further, Mr Miller neither at the time or subsequently appears to have considered his actions – with the exception of failing to record the free drinks he gave to staff – to have been unacceptable.

[64] The issues were clearly put to Mr Miller by Mr Nikakis at the meeting on 30 September. He gave Mr Miller time to think about his response. He did not however warn Mr Miller that an unsatisfactory response could lead to the termination of his employment. It is arguable that Mr Miller should have been aware that he was at risk of losing his employment because of the seriousness with which Mr Nikakis was treating the matters. I accept however that he was not advised that his employment was at risk.

[65] He was given an opportunity to respond to the matters raised by Mr Nikakis. Mr Hollingworth has argued that this was not an adequate opportunity. It appears however that there was not much that Mr Miller could have said which would have altered his position given his view that he had not done much wrong.

[66] Mr Hollingworth also argued that Mr Miller should have been advised of his right to have a support person present. The Act refers to this not in terms of an employee’s right to be advised that they can have a support person but in terms of an employer’s unreasonable refusal to allow them to have one. Mr Miller did not seek to have a support person. If he was familiar with the employer’s policy manual he would have been aware of his right to ask for one.

[67] The dismissal related to conduct, not unsatisfactory performance so section 387(e) is not relevant. There was no evidence of the size of the employer’s business or the respondent’s access to human resources management advice. Mr Nikakis, who acted for the respondent, is both a director and hands on manager of the business and apart from Ms Cudden, the other employees appear to have been operational staff. The respondent was represented by the Australian Hotels Association, and presumably had access to their human resources advisors.

[68] I also consider it to be relevant that the applicant was a senior member of staff, that his conduct also involved junior staff members and that he was aware of the employer’s concern that the business was the subject of some scrutiny by the Liquor Licensing Authority during the relevant period of time.

[69] For these reasons I am satisfied that the dismissal was not harsh, unjust or unreasonable and the application is therefore dismissed.

COMMISSIONER

Appearances:

I. Hollingworth for Miller.

A. Duffy of counsel, for Koornang Pty Ltd t/as Rosstown Hotel.

Hearing details:

2010.

Melbourne:

March 3, 4.

 1   Exhibit R7.

 2   Exhibit R7 at page 17.

 3   Delany v Parramatta Leagues Club (2010) FWA 1164.

 4   Laws v London Chronicle (1959) 1 WLR 698.

 5   North v Television Corporation Limited (1976)11 ALR 599.

 6   Rankin v Marine Power International (2001) 107 IR 117.

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