Moore v Slondia Nominees Pty Ltd - [2012] FMCA 273

FEDERAL MAGISTRATES COURT OF AUSTRALIA

MOORE v SLONDIA NOMINEES PTY LTD

[2012] FMCA 273

INDUSTRIAL LAW – General protections application relating to dismissal - reversal of onus of proof – whether reason advanced by respondent the real reason for dismissal.

Fair Work Act 2009 (Cth), ss.340, 341, 360, 361, 369, 371, 539, 545 & 546
Workplace Relations Act 1996 (Cth), ss.298V & 809
Conciliation and Arbitration Act 1904 (Cth), s.5
Evidence Act 1995 (Cth), s.140

Barclay and Another v Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC14
General Motors-Holden Pty Ltd v Bowling (1976) 12 ALR 605
CFMEU v Coal and Allied Operations Pty Ltd (1999) 140 IR 131
Rojasv Esselte Australia Pty Limited (No. 2) [2008] FCA 1585
Briginshaw & Briginshaw [1938] HCA 34
Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd and Ors (1992) 110 ALR 449
Australian Licenced Aircraft Engineers Association v International Aviations Service Assistance Pty Ltd [2011] FCA 333
Plancor Pty Ltd v Liquor Hospitality and Miscellaneous Union [2008] FCAFC 170

Applicant:

SANDY MOORE

Respondent:

SLONDIA NOMINEES PTY LTD

File Number:

ADG 44 of 2011

Judgment of:

Lindsay FM

Hearing date:

5 December 2011

Date of Last Submission:

5 December 2011

Delivered at:

Adelaide

Delivered on:

4 April 2012

REPRESENTATION

Counsel for the Applicant:

Mr Colgrave

Solicitors for the Applicant:

Bourne Lawyers

Counsel for the Respondent:

Mr Manuel

Solicitors for the Respondent:

Fox Tucker Lawyers

UPON NOTING that the Court is satisfied that the respondent has contravened the civil remedy provisions referred to in s.539 of the Fair Work Act 2009 in the manner specified in the Application filed on 24 February 2011

ORDER

The question of whether a pecuniary penalty order pursuant to s.546 of the Act should be made and whether and if so what order awarding the applicant compensation for loss pursuant to s.545(2)(b) of the Act is adjourned to a date to be fixed by the Court in consultation with Counsel for the parties.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT ADELAIDE

ADG 44 of 2011

SANDY MOORE

Applicant

And

SLONDIA NOMINEES PTY LTD

Respondent

REASONS FOR JUDGMENT

This is a civil remedies application pursuant to Part 4-1 of the Fair Work Act 2009 (“the Act”). It is a general protections court application in which the applicant alleges that the respondent took adverse action against her contrary to s.340 of the Act.
The applicant seeks a penalty in respect of the contravention in accordance with s.539 of the Act and also seeks compensation pursuant to s.545 of the Act.
The contravention involves a dismissal and no issue arises as to compliance with s.371 of the Act. Fair Work Australia has issued a certificate under s.369 of the Act which is annexed to the application.
Subject to one minor aspect of the evidence presented on behalf of the respondent, no issue arises as to whether or not the applicant was dismissed from her employment.
She claims that she was dismissed on account of her exercising a workplace right pursuant to s.341 of the Act. That is disputed by the respondent. That issue is at the core of these proceedings. But no issue arises as to the whether or not the reason the applicant advances for the dismissal involved the exercise of a workplace right. In short, the applicant claims that she was dismissed because she made application to the relevant State court for monies owing to her under her contract of employment. That clearly involved the exercise of a workplace right. The issue is whether she was dismissed because of her exercise of that workplace right.
The applicant is a shoe and leather repairer with stitching skills.
The respondent is the owner of a business which operates in South Australia, Western Australia and Victoria. One aspect of the business is known as “Mike’s Multi Service” which provides repair of shoe and other leather products in association with other services such as key cutting, engraving and the like.
The applicant was first employed by the respondent in June 2009. The respondent has outlets at three shopping centres in metropolitan Adelaide. The applicant worked principally at the two outlets at West Lakes and also worked occasionally at Tea Tree Plaza.
Some uncertainty is associated as to whether and for what periods the applicant was employed as a casual employee and whether and for what periods she was employed as a part time permanent employee. In her evidence before me the applicant’s position in relation to this was that she was employed on a casual basis until July 2010 and thereafter employed on a part time permanent basis. In April 2010 she had raised with her employer her contention that she was not being paid at the casual rate, and especially that she was not being paid at that rate for weekend work. She said that in that month her hourly rate increased from $18 per hour to $22.50 per hour. She contends that from the commencement of her employment in June 2009 until April 2010 she was underpaid by the difference by those two amounts. She says that in July 2010 she asked to return to permanent part time basis and her employer agreed to do that at the same rate of $22.50 per hour.
An issue arose as to the amount paid to her in respect of the Monday public holiday in October 2010 and whether for that reason or because it was something she had intended to pursue for some time in any event, on 24 November 2010 she lodged a Monetary Claim in the Industrial Relations Court of South Australia seeking payment of the sum of $4,731.75 plus interest. She says that the application to that court was served on the employer some days later.
She said that no officer of her employer discussed these proceedings with her. She did not work on Christmas Eve or Boxing Day or 27 December and she expected to be paid for those days when the next pay was due to her being Wednesday, 28 December. On that day she spoke with Mr Zaharijevski who was a manager in the employment of the respondent. The conversation was over the telephone. She alleges that he told her that “we have no more hours for you”. She says that she then claimed that she was entitled to notice and that he responded by saying that she was a casual employee.
There was a further telephone conversation the next day relating to her request for a termination certificate during which Mr Zaharijevski said that the unavailability of hours for her was on account of slow down in business.
The applicant contends that she was dismissed and she says the dismissal was on account of her having filed and served the Industrial Relations Court proceedings the previous month.
There was some faint attempt by the respondent to argue that she was not in fact dismissed but simply informed that less hours would be made available to her and that this was put to her in the context of the view on the part of her employer that she was employed on a casual basis, but ultimately this aspect of the response was not seriously pressed. The respondent’s final contention was that she was dismissed because of the downturn in the business of the respondent throughout Australia, in South Australia in particular and at the West Lakes store in particular.
If I accept the applicant’s case then she will have been subject to adverse action on account of her exercise of a workplace right. That was not put in issue by the respondent.
The issue, then, to be determined is why the applicant was dismissed.
There are two important provisions of the Act that come into play in a case of this nature. The first is s.360 which says:
For the purposes of this Part, a person takes action for a particular reason if the reasons for that action include that reason.
The reference is to Part 3.1 of the Act which includes the general protections provisions on which this application was based.
The second is s.361 which provides:
(1)    If:
(a)     in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or for a particular intent; and
(b)     taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed, in proceedings arising from the application, that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
(2) …
The shorthand way of describing s.361 is to say it is a legislative provision which reverses the onus of proof.
A very similar provision was contained in s.809 of the Workplace Relations Act 1996. That section provided:
(1): If:
(a) in an application under section 807 relating to a person’s conduct, it is alleged that the conduct was, or is being, carried out for a particular reason or with a particular intent; and
(b) for the person to carry out the conduct for that reason or with that intent would constitute a contravention of this Part;
it is presumed, in proceedings under this Division arising from the application, that the conduct was, or is being, carried out for that reason or with that intent, unless the person proves otherwise.
The effect of s.361 was described by the Full Court of the Federal Court in Barclay & Another v Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC14 at [32] (per Gray and Bromberg JJ) as follows:
The onus cast by s 361 on the person taking the adverse action means that, to succeed, that person has to establish that he or she was not actuated by the attributes or industrial activity which s 346 seeks to protect. As Mason J said in Bowling at 241; 617, that objective will not be achieved unless the evidence establishes that the real reason for the adverse action lies outside the ambit of the provision – in this case s 346. The real reason or reasons for the taking of the adverse action must be shown to be “disassociated from the circumstances” that the aggrieved person has or had the s 346 attribute or has or had engaged in or proposes to engage in the s 346 industrial activity.
The reference to Bowling in the above passage is a reference to the judgment of Mason J in General Motors-Holden Pty Ltd v Bowling (1976) 12 ALR 605 at 617. The relevant statutory provision in that case was s.5 of the Conciliation and Arbitration Act 1904. It provided that it was an offence for an employer to dismiss an employee by reason of his membership of a Trade Union or for doing something pursuant to holding such membership. Section 5(4) provided:
In any proceeding for an offence against this section, if all the facts and circumstances constituting the offence, other than the reason for the defendant’s action, are proved it shall lie upon the defendant to prove he was not actuated by the reason alleged in the charge.
Mason J (as he then was) at 617 explained the effect of that section as follows:
Section 5(4) imposed the onus on the appellant of establishing affirmatively that it was not actuated by the reason alleged in the charge. The consequence was that the respondent, in order to succeed, was not bound to adduce evidence that the appellant was actuated by that reason, a matter peculiarly within the knowledge of the appellant. The respondent was entitled to succeed if the evidence was consistent with the hypothesis that the appellant was so actuated and that hypothesis was not displaced by the appellant. To hold that, despite the subsection, there is some requirement that the prosecutor brings evidence of this fact is to make an implication which, in my view, is unwarranted and which is at variance with the plain purpose of the provision in throwing on to the defendant the onus of proving that which lies peculiarly within his own knowledge.
The “requirement” referred to in the last part of that passage was one which found favour with Barwick CJ who dissented from the decision of the Court in that same case (See Bowling (supra) at 611.)
In my opinion, before resort can be had to this onus provision, there must be before the court evidence which reasonably warrants the conclusion that the circumstance that the employee had been placed in the appropriate office of his union was possibly a reason for his dismissal. If, on the evidence, there is no basis for concluding that that circumstance might be or have been a reason for the dismissal, there is no room for requiring the employer to negative the proposition that that circumstance was such a reason. Put another way, it can properly be said, in my opinion, that if the evidence does not afford ground for concluding that that circumstance was possibly such a reason, the onus is by the absence of such evidence satisfied: on that state of the evidence it could not be concluded that that circumstance was a motivating reason.
That view of the effect of this kind of statutory provision has not received support in decisions relating to subsequent manifestations of such a provision in industrial statutes. In other words, the provision is not to be approached by first scrutinising the applicant’s case to ascertain whether the applicant has crossed some evidential threshold and only then giving effect to the reversal of the onus. The presumption begins its operative effect from the point at which the allegation is first raised.
This is not to be confused with the ongoing requirement for the applicant to prove the existence of objective facts which are said to provide the basis for the respondent’s conduct. That was the point made by Branson J in relation to an earlier manifestation of the provision (s.298V of the Workplace Relations Act 1996) in CFMEU v Coal and Allied Operations Pty Ltd (1999) 140 IR 131 at [161 – 162].
[The employee] did not relevantly participate in proceedings under an industrial law within the meaning of s 298L(1)(j). Section 298V of the Act does not, in my view, allow the applicant to circumvent that finding. Rather it is to be construed as an aid to proof of the intent or reason of the respondent which motivated, or formed part of the motivation for, the respondent’s conduct. It may fairly be presumed that the section is intended to alleviate the difficulties of proof by one party of the state of mind or motivation of another.
For analogous reasons, I do not consider, so far as the circumstances proscribed in s 298L(1)(m) are concerned, that s 298V relieves the applicant from the obligation of establishing as a fact that the relevant employee absented himself from work without leave for the purpose of carrying out duties as an officer of an industrial association (s 298L(1)(m)(i)) and that the employee applied for leave before absenting himself and that leave was unreasonably refused or withheld (s 298L(1)(m)(ii)). The impact of s 298V, in my view, is simply to alleviate the evidentiary difficulty facing the applicant of providing proof of the intent or reason which motivated, or formed part of the motivation for, the respondent’s conduct following the absence of the employee from work.
For sake of completeness I set out s.298V referred to in that decision.
If:
(a) in an application under this Division relating to a person’s or an industrial association’s conduct, it is alleged that the conduct was, or is being, carried out for a particular reason or with a particular intent; and
(b) for the person or industrial association to carry out the conduct for that reason or with that intent would constitute a contravention of this Part;
it is presumed, in proceedings under this Division arising from the application, that the conduct was, or is being, carried out for that reason or with that intent, unless the person or industrial association proves otherwise.
Thus in the present case I need to be satisfied on the applicant’s case, for example, as to the existence of an employment contract and of a dismissal and of those matters which, if accepted, would constitute adverse action in relation to a workplace right. It is the reason for the alleged contravener’s action or the intent with which it was carried out that the applicant is relieved from establishing. The onus shifts once that reason or that intent is averred in the application.
The nature of the reversal of the onus is such that ordinarily the respondent will need to adduce evidence that accounts for the dismissal. As Moore J said in relation to s.809 of the Workplace Relations Act 1996 (see paragraph 21 above) in Rojasv Esselte Australia Pty Limited (No. 2) [2008] FCA 1585 at [48]:
Moreover, the effect of s 809 is that in most cases an explanation for the real reason for the dismissal, consistent with the absence of a prohibited reason, is, in a practical sense, also necessary to rebut the presumption.
I should not leave the question of the effect of ss. 360 and 361 without referring to the judgment of Lander J in Barclay (supra). Whilst a dissentient as to the ultimate outcome of the case his Honour summarised the effect of the provisions at [195] as follows:
If an employee alleges that the employee’s employer took the action for a particular reason the employer has the onus of proving otherwise: s 362. Sections 340 and 346 therefore have to be considered in the light that the simple allegation that the employer took the particular action for an impugned reason will be enough to prove the employee’s case unless the employer proves otherwise. The employer will not discharge that onus by proving that the employer took the adverse action for a number of reasons which include the proscribed reason or reasons because s 360 would then be engaged. The employer must therefore prove that the employer took the adverse action for a reason or reasons that did not include the impugned reason. The onus is to be discharged on the balance of probabilities:
Section 551 of the Act provides:
A court must apply the rules of evidence and procedure for civil matters when hearing proceedings relating to a contravention, or proposed contravention, of a civil remedy provision.
The question arises as to the content of those rules of evidence and procedure is, and the answer is to look to the provisions of the Commonwealth Evidence Act 1995. Section 140 of that Act deals with the question of standard of proof and provides:
(1)In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.
(2)Without limiting the matters that the court may take into court in deciding whether it is so satisfied, it is to take into account;
(a)     the nature of the cause of action or defence; and
(b)     the nature of the subject-matter of the proceeding; and
(c)     the gravity of the matters alleged.
There is no doubting that subsection (2) has been drawn with the classic remarks of Dixon J as he then was in Briginshaw & Briginshaw [1938] HCA 34 in mind. In dealing with the standard of proof required in relation to the allegation of adultery in the matrimonial-causes jurisdiction he said:
The truth is that, when the law requires the proof of any fact, the tribunal must feel an actual persuasion of its occurrence or existence before it can be found. It cannot be found as a result of a mere mechanical comparison of probabilities independently of any belief in its reality. No doubt an opinion that a state of facts exists may be held according to indefinite gradations of certainty; and this has led to attempts to define exactly the certainty required by the law for various purposes. Fortunately, however, at common law no third standard of persuasion was definitely developed. Except upon criminal issues to be proved by the prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters "reasonable satisfaction" should not be produced by inexact proofs, indefinite testimony, or indirect inferences.
…
Upon an issue of adultery in a matrimonial cause the importance and gravity of the question make it impossible to be reasonably satisfied of the truth of the allegation without the exercise of caution and unless the proofs survive a careful scrutiny and appear precise and not loose and inexact. Further, circumstantial evidence cannot satisfy a sound judgment of a state of facts if it is susceptible of some other not improbable explanation. But if the proofs adduced, when subjected to these tests, satisfy the tribunal of fact that the adultery alleged was committed, it should so find.

There was some degree of dispute between counsel before me as to whether the “Briginshaw standard”, so-called, should be imported into these proceedings and in particular into the process of adjudication that takes place having regard to the reversal of the onus of proof. I think it is important to remind myself that the burden of proof remains throughout the civil burden; being satisfaction on the balance of probabilities. Dixon J (as he then was) was at some pains to identify that the law knows only two different standards of persuasion being the criminal standard of satisfaction beyond reasonable doubt and the civil standard referred to. Briginshaw (supra) does not itself constitute a third standard of persuasion. As was observed by the High Court of Australia in Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd and Ors (1992) 110 ALR 449 at 449 – 450 in the context of a case turning on the adjudication of allegations relating to the tort of deceit:
The ordinary standard of proof required of a party who bears the onus in civil litigation in this country is proof on the balance of probabilities. That remains so even though the matter to be proved involves criminal conduct or fraud. On the other hand, the strength of the evidence necessary to establish a fact or facts on the balance of probabilities may vary according to the nature of what it is sought to prove. Thus, authoritative statements have often been made to the effect that clear or cogent or strict proof is necessary “where so serious a matter as fraud is to be found”. Statements to that effect should not, however, be understood as directed to the standard of proof. Rather, they should be understood as merely reflecting a conventional perception that members of our society do not ordinarily engage in criminal or fraudulent conduct … .
After citing a portion of the passage from Briginshaw (supra) set out at paragraph 34 herein the High Court goes on to say:
There are, however, circumstances in which generalisations about the need for clear and cogent evidence to prove matters of the gravity of fraud or crime are, even when understood as not directed to the standard of proof, likely to be unhelpful and even misleading.
This was not a case involving an allegation of fraud or any other quasi criminal conduct but the passage cited should serve as a reminder that the “Briginshaw standard” remains proof on the balance of probabilities and that what is required is actual satisfaction based upon clear and cogent evidence.
The reversal of the onus of proof in this case means that the respondent must satisfy me on the balance of probabilities that the applicant was not dismissed for the reasons she advances.
It is particularly important in the context of a reversal of the onus of proof not to proceed to make the discharge of that onus any more difficult because of the importation of the so-called “Briginshaw standard of proof”.
This was a case where the respondent called evidence which purported to provide an account of the reasons for the dismissal and the intention of the respondent in dismissing the applicant.
The respondent called three witnesses. The first was a Mr Scott Davies who is the State Manager of the company. It was he who hired the applicant in 2009.
Her initial rate of pay was $18 per hour.
In April 2010 he went to America for a holiday and when he returned he says that the applicant was complaining about being underpaid. He negotiated an increase in her hourly rate from $18 per hour to $22.50 per hour. That is the 25 per cent increase which the applicant claimed was referable to her being employed as a casual employee.
He confirmed the applicant’s evidence about an approach made in June or July for the applicant to be permanent part time. He says that he had no difficulty with that but it was never followed through by either him or by the applicant.
He said that in August 2010 a second outlet for the respondent at West Lakes was brought into operation.
He knew nothing about the applicant having instituted proceedings until it was brought to his attention by his Manager Director, Mr Mercanti. He was surprised that an application was made to the Industrial Court. He said that he thought it was being dealt with by the Managing Director and that he was too busy in the period leading up to Christmas to have become involved in the matter.
He said that during December he had some discussions with the Victorian Retail Manager of the respondent, a Mr Nick Zaharijevski, about reducing the applicant’s hours following Christmas. He said the explanation provided by Mr Zaharijevski was the pressure the respondent was facing as to its finances in the wake of the global financial crises. He said that Mr Zaharijevski’s remarks to him were consistent with the picture that had been painted by Mr Mercanti who had been putting limits on the amount of stock that the Adelaide stores could acquire from the head office.
He said that he reduced the hours of full time staff in Adelaide after Christmas and that a decision was made that the applicant would not get further hours after Christmas.
He tried to qualify this by suggesting that hours might have been made available some months down the track but, as with Mr Mercanti’s evidence on this topic, such a contention was only faintly pressed. Effectively he acknowledged that the applicant’s employment was terminated.
Since the departure of the applicant he has been working one of the West Lakes stores on his own for part of the week.
A casual employee was engaged at the Tea Tree Plaza store after the departure of the applicant but she was employed with a view to focussing on sales and not for her skills as stitcher or shoe repairer.
Mr Zaharijevski also gave evidence. As with the other witnesses at the trial (including the applicant) his evidence-in-chief was in the form of an affidavit augmented with brief oral evidence.
Mr Zaharijevski operates the four stores owned by the respondent in Melbourne. From about the middle of 2010 he has been visiting Adelaide on a regular basis to assist Mr Davies in his role. He is more experienced than Mr Davies.
He said that the Managing Director asked him in November 2010 to further reduce costs. He said that nationally all of the stores had been on trimmed budgets for some time. He decided to cut the hours of the applicant and to reduce the overtime hours of full time staff at one of the West Lakes stores. His affidavit said that this was a decision he reached in conjunction with Mr Davies and for which he obtained Mr Mercanti’s approval. In cross-examination he conceded that Mr Mercanti had given the direction to him and Mr Davies to terminate the applicant’s employment.
He says that he telephoned the applicant following Christmas and advised that he would not be providing her with any more hours until the business picked up again. Once again there was an attempt to half heartedly suggest that, in truth, the applicant’s employment had not been terminated but it was never seriously contended by him. He said that the applicant was not accepting of the reasons he advanced for her termination and that she accused him of lying to her and suggested there were other reasons. He is not able to say whether he knew at the time that he terminated her employment that she had brought an application for arrears of wages although he conceded in cross-examination that he was probably told about this by Mr Mercanti. He thought that she thought there was some personal reason behind the cutting of her hours. He said that the applicant had been aware of the cuts to stock that had been made in Adelaide in the previous months.
He dealt with it on the basis of his assumption that she was a casual employee. That was not the applicant’s understanding.
Mr Mercanti is the Managing Director of the respondent. He filed an affidavit which annexed extensive material in the form of trial balances for the two arms of his enterprise, namely SA Shoe Care Products and WA Shoe Care Products for 2009 and 2010. A number of other financial and business documents were attached which are referred to specifically hereunder.
His affidavit contained this assertion in paragraph 6:
I should clarify that the respondent advised a casual employee (the applicant) that further hours of work were not available in the short term so I do not think it should be called a dismissal.
There seems to have been a degree of confusion on the part of Mr Mercanti and Mr Davies as to whether the applicant was a casual or permanent part time employee. I have already noted that by the time of the filing of her affidavit in these proceedings on 11 October, at least, her position was she had been casual but underpaid from June 2009 to April 2010; casual but paid an appropriate rate between April and July 2010; and permanent part time until her dismissal.
This was not her position before Ardlie IM in the State Industrial Court proceedings although her contentions in that Court were not necessarily clear. It appears as if she was contending at one point that she was employed on a permanent part time basis to begin with (see [12] of his Honour’s reasons which were provided by consent of the parties to me and which were not marked as an exhibit at the trial but which I have subsequently marked as Exhibit 4). At another point ([13] of the reasons) she is recorded as giving evidence of having told Davies at the outset of her employment that she was permanent part time although her calculations of her arrears were based upon her being a casual employee.
It seems to me that neither Mr Davies nor Mr Mercanti ever considered the issue to be of significance during the period of the applicant’s employment. In a sense, it is not the detail of the workplace right that was being claimed by the applicant in her proceedings that matters but rather the fact that it was a workplace right that was being claimed. On balance I am prepared to accept that her affidavit filed in my Court accurately sets out the history of the discussions she had with Mr Davies as to the nature of her employment and in any event, I do not accept that either Davies, Mercanti or Zaharijevski seriously intended to leave open the prospect of further hours being made available to the applicant later in the year after she was dismissed and given that, their belief as to the nature of her employment is probably inconsequential.
The respondent’s business was run by Mr Mercanti upon the basis that the various branches of Mike’s Multi Service were treated as trade debtors to the business in the same way as unrelated enterprises were. The various Mike’s Multi Service stores built up considerable trade debts for goods supplied but the cross-examination of Mr Mercanti revealed an arbitrariness about the allocation of those debt figures and also in relation to their subsequent discharge. For example, the West Lakes store (no. 1) builds up a debt over the course of 2009 and 2010 of over $100,000 (the figure of $100,347.61 as at 2 August 2010) but by December 2010 it has been diminished to $5,422.43. The trial balances provided demonstrate that the business was an extensive one requiring careful management but are of little assistance in shedding light on the specific circumstances of the Adelaide part of the enterprise at the end of 2010. The year to date figures which are set out at Annexure TM2 are more helpful. They indicate that sales at West Lakes One for the calendar year 2010 were 11.9 per cent down on the figures for 2009 (based on a gross sales figure for 2010 of well over half a million dollars). The percentage decline for Tea Tree Plaza over those two years was almost double but on a much smaller turnover and Elizabeth demonstrated a rise of the same order of magnitude on much smaller figures.
It must be taken into account of course, that the West Lakes Two store opened in 2010 and accounts for almost half of the percentage decline in sales figures for West Lakes One.
In his trial affidavit Mr Mercanti refers to the opening of the second store at West Lakes as follows:
(9)It may seem incongruous that during this period we opened up another store in South Australia at West Lakes (West Lakes Two). However, we made this move to protect our market share as there is significant competition with competitors who have more market share than our business.
Mr Mercanti also annexes a graph which summarises the hours worked by employees in all stores between July 2010 and October 2011 and the graph appears to demonstrate that the end of 2010 was a low point though not significantly lower than September 2010 and not as low as April 2011.
The next annexure contains documents from the Tax Office indicating that the West Australian shoe care arm of the business is required to pay income tax of just under $100,000 by March 2011 and that legal proceedings are threatened in relation to the outstanding amount.
Each of the first four annexures contain documents which assist in an understanding of the size of and nature of the business enterprise and of its financial circumstances for the periods addressed. Annexure TM5, however, is unhelpful. It contains a vast amount of email traffic between Mr Mercanti’s Wholesale State Manager and himself and other employees containing urgent requests for payment of wholesale creditors in 2009, 2010 and 2011. If the annexure of that vast quantity of material is provided with an implied invitation to the Court to peruse it upon reservation of judgment, the invitation is declined. I indicated in open Court that I would only have regard to specific items of that material that were the subject of cross-examination or specific submission.
Given the size of the business enterprise and the number of stores and the nature of the business it is unsurprising that the financial fortunes of the business would ebb and flow over the course of a period of time. This kind of information in Annexure TM5 ultimately is only of limited assistance in determining what actuated or accounted for a decision to dismiss a single casual or part time employee engaged in one aspect of one store of the business in one state.
A number of general conclusions can be drawn from the evidence of the three witnesses called by the respondent. The first is that, with the exception of a claim by Mr Davies that some unspecified full time staff had overtime hours cut after Christmas 2010, there was no evidence of any other employee of the enterprise being dismissed or having their work hours cut at or about the time the applicant was dismissed.
There may be a variance in the level of knowledge of the three persons about the institution of the proceedings in the State Industrial Court by the applicant but I am clearly satisfied that all of them were well aware of the proceedings by the date of the dismissal.
In terms of the contention that there was a downturn in business in 2010, I am satisfied that as a general proposition that is correct although no witness could indicate whether there had been a consideration of whether certain aspects of the business were doing better than others; for example, whether the decline was in relation to retail sales rather than the leather repair work in which the applicant was engaged. I am prepared to accept the likelihood that the applicant was regarded as a casual employee by management to the extent that they gave the matter any specific consideration and that, in a general sense, if employees are to be released I can proceed upon the basis of the likelihood that casual employees will be released first.
I accept that the applicant’s skills, whilst significant, were limited to the area of stitching.
I accept that the Australian Taxation Office was bringing some pressure to bear upon at least one arm of the business enterprise during 2010.
In relation to the applicant’s oral evidence there is no doubting that she is to some extent embittered by her experience with the respondent. There was evidence introduced in the form of email correspondence with the Equal Opportunities Commission in South Australia indicating that after her employment was terminated she gave consideration to bringing a claim that she had been discriminated against in her employment because she was a female. A carefully prepared affidavit was sent by her to the Equal Opportunities Commission which canvasses essentially the same factual issues but adds the contentions relating to her being treated less favourably than male employees.
Having read her affidavit and heard her evidence and read the reasons given by Ardlie IM it seems to me that she promoted her unpaid wages claim probably upon the basis of having not understood that a payment of $18 per hour during 2009 and 2010 was probably appropriate for her casual work save and except for that portion that related to weekend or public holiday work.
But the way in which this case is to be determined means that issues of creditworthiness in relation to the applicant will be of limited relevance. There is no doubt that she instituted a wage claim for arrears, whatever merit or otherwise the claim had. There is no doubt that her employment was terminated.
Beginning from the position that s.361 requires, that of presuming that the respondent took adverse action against the applicant by dismissing her because she had exercised her workplace right of pursuing a claim for arrears of wages, am I satisfied that the respondent has proved otherwise? In other words, am I satisfied that the real reason for the dismissal was the implementation of necessary cost cutting measures in the business of the respondent?
I am not so satisfied.
Firstly, the temporal proximity of the dismissal to the filing and service of the Industrial Relations Court application is a matter that is not explained by the evidence adduced on behalf of the respondent. The temporal proximity is not something that is any part of the presumption required by s.361. The presumption arises from the contention in the application itself. However, it is only natural that when considering the evidence advanced by the respondent I would ask myself whether the temporal proximity of the dismissal to the filing and service of the proceedings is explained on the evidence. The proceedings were filed on 24 November and I proceed on the basis that they were served within a week of institution so that the sacking follows on the service of the proceedings by about a month, after the busy Christmas trading period had come to an end. The dismissal did not take place during the earlier part of the year (when trading conditions were also, relatively speaking, adverse to some degree); it did not take place after the busy Christmas trading period and when the applicant had returned to work for a period of time. It took place shortly after the filing and service of the proceedings. In other words, it followed on shortly after the filing and service of the proceedings.
Moreover, the dismissal seemed to be an isolated event rather than part of a general strategy for dealing with the difficult trading conditions. There was no evidence adduced to indicate any planned reduction in working hours or in staff across the various stores or even within the South Australian stores. This employee is the only employee whose services have been dispensed with.
The magnitude of the amount claimed by the Australian Taxation Office which constitutes Annexure TM4 to the affidavit of Mr Mercanti, if they gave rise to the imperative for real cost cutting measures, would surely have resulted in more employees being dismissed than simply this part time or casual employee at one store in Adelaide. I am not satisfied on the evidence presented by the respondent that the dismissal of the applicant was an incident of or part of a general cost cutting strategy. In other words, there was no evidence of any systematic or thorough going review of operations and of staffing levels (or hours allocated to staff) generally.

I have tried to bear in mind that there are risks associated with assuming that because of one event follows another event it was caused by another event. I do not want to proceed upon the basis of post hoc ergo propter hoc. But experience suggests that if one event is the cause of or explains the occurrence of another event there is likely to be a degree of temporal proximity between the events. There may be other explanations for the temporal proximity of events. There was no explanation provided by the respondent for the temporal proximity of these events. That being the position, their case must be taken to be that the temporal proximity was simply coincidental. It is in that context that I look to the absence of other evidence of employees dismissed or employee hours reduced, and the other evidence referred to above and hereunder, I am not satisfied that the temporal proximity is a matter of coincidence.
I have indicated, passim, that I accept the general proposition that 2009 and 2010 saw a contraction in the amount of trading the respondent was able to achieve but no evidence was produced to me to indicate that as a response to that predicament, the respondent engaged in a planned reduction in employee levels or in employee hours. If cost cutting was the real reason for the dismissal of the applicant other instances of such dismissals in an enterprise of the size of the respondent’s business enterprise would have been expected to have occurred. It is not even a case, in my view, of there being two explanations or reasons for the respondent dismissing the applicant such as to bring into play s.360 of the Act. The existence of that section has obviated the need to determine whether the exercise of the workplace right was a “substantial and operative factor” in the dismissal as was formerly required (see the judgment of Mason J as he then was in Bowling (supra) at 616). But recourse to s.360 in this case is unnecessary.
Furthermore, Annexure TM2 revealed that the Rockingham store, for example, and the Piccadilly store for that matter, were suffering more significant reduction in gross sales between 2009 and 2010 than the West Lakes store and yet there was no evidence adduced of employee reduction measures at those stores which one would have expected to see if the dismissal of the applicant was an incident of such a strategy.
The evidence presented by the respondent persuaded me that the decision to terminate the employment of the applicant was made by Mr Mercanti and implemented by Mr Zaharijevski in concert with Mr Davies. It is one thing for Mr Mercanti to institute a policy but it is another for him to involve himself in the selection of the single employee who is to bear the brunt of the policy. If the reason advanced in the evidence of the respondent for the dismissal was the genuine reason for it, the nomination of the applicant for dismissal is more likely to have been the initiative of Mr Davies. But Mr Davies was only carrying out Mr Mercanti’s decision to dismiss the applicant albeit that Mr Mercanti instructed Mr Zaharijevski to assist in that action.
If the reason advanced was the real reason for the dismissal I would have expected there to have been some cursory consideration given as to whether the decline in sales was related more to retail activity than repair activity but there was no evidence that such consideration was ever given.
At the conclusion of the evidence the respondent has not satisfied me to the requisite standard that the applicant was dismissed other than because of her exercise of her workplace right.
I turn to the question of penalty.
Application is made for a penalty pursuant to s.546 of the Act. The penalty for a breach of the general protections provisions by a corporation is a function of the amount prescribed in the table appearing in s.539(2) of the Act and provisions of s.546(2).
The maximum penalty is $33,000. In addition, the applicant seeks an order for compensation for the loss that the applicant has suffered as a result of the contravention in accordance with s.545(2)(b) of the Act. The amount sought is a loss of salary of $25,000 with an added superannuation component of $2,250.
The power to impose a civil penalty is discretionary. In other words, it is not just a matter of determining the amount of the pecuniary penalty but of deciding whether there should be a pecuniary penalty at all (see Australian Licenced Aircraft Engineers Association v International Aviations Service Assistance Pty Ltd [2011] FCA 333 at [465] though no indication is given as to why the imposition of a pecuniary penalty is appropriate in that case). See also Rojas (supra) at [64], a case, it will be recalled, that proceeded under the Workplace Relations Act 1996, although, again, whilst the discretionary nature of the power to impose a pecuniary penalty is noted no guide as to the factors which will determine whether to impose it are described.
Each of the parties made submissions at the close of the trial as to the appropriate penalty to be imposed and whether compensation should be ordered but I neglected to seek submissions from either counsel as to the criteria which will guide the exercise of the discretion as to whether a civil penalty should be imposed.
Counsel referred me to the decision of Plancor Pty Ltd v Liquor Hospitality and Miscellaneous Union [2008] FCAFC 170. Whilst there is a great deal of guidance, with respect, given by the decision in that case as to various aspects of the exercise of imposing penalty I will need to hear from the parties as to whether it provides any guidance with respect to the specific issue as to whether a civil penalty should be imposed as distinct from the issue as to whether, if it is imposed, to whom it should be paid.
In the circumstances, I propose to relist the matter to provide counsel with the opportunity of addressing me in relation to whether I should make a pecuniary penalty order in accordance with s.546 of the Act.

I certify that the preceding ninety-three (93) paragraphs are a true copy of the reasons for judgment of Lindsay FM

Date: 4 April 2012