Mr Bruce Charlton v JD Trucking Pty Ltd
[2015] FWC 5807
•9 SEPTEMBER 2015
| [2015] FWC 5807 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Mr Bruce Charlton
v
JD Trucking Pty Ltd
(U2015/5653)
COMMISSIONER HAMPTON | ADELAIDE, 9 SEPTEMBER 2015 |
Application for relief from unfair dismissal – whether dismissal occurred – whether dismissal unfair – jurisdiction found – dismissal harsh, unjust and unreasonable – compensation awarded.
1. Introduction and Case Outline
[1] Mr Bruce Charlton has made an application to the Commission seeking a remedy for an alleged unfair dismissal. The application has been made under s.394 of the Fair Work Act 2009 (the FW Act). Mr Charlton’s employer was JD Trucking Pty Ltd (JD Trucking).
[2] Mr Charlton was engaged as a full-time Interstate Truck Driver with JD Trucking on 29 October 2013. Mr Charlton contends that he was dismissed on or about 18 May 2015.
[3] JD Trucking is a small business within the meaning of the Act 1 and undertakes both local and interstate transport.
[4] There is no dispute that Mr Charlton was protected from unfair dismissal within the meaning of s.382 of the FW Act.
[5] It is not in dispute that until the events leading to this application, the employment of Mr Charlton was largely uneventful. In February 2015, the applicant injured his right elbow. This led to an accepted workers compensation claim and an absence from work that extended until mid-May 2015.
[6] It is also common ground between the parties that on Thursday 14 May 2015 Mr Charlton advised JD Trucking that he was now cleared to return to work and that the employer did not respond to that advice prior to the events of Monday 18 May 2015.
[7] It is apparent that on 18 May 2015 a text exchange and a telephone discussion took place between Mr Charlton and Mr Darren Hick, a Director of the employer. There is some dispute about the detail of those events but in particular, there is a dispute about the impact of these exchanges upon Mr Charlton’s employment.
[8] Mr Charlton contends that he was dismissed by JD Trucking and the employer contends that it did not dismiss the applicant at that time or at all. This is the jurisdictional issue that needs to be determined. Mr Charlton claims that his dismissal was unfair and is seeking 4 weeks compensation. The employer contends that it subsequently offered further work to Mr Charlton which was not accepted and that work within its business remains available to the applicant.
[9] Given the evident factual conflicts, I was obliged2 to conduct a hearing or conference in order to make the necessary findings leading to the determination of the jurisdictional issue and the matter more generally. This application was subject to a determinative conference following consultation with the parties as contemplated by s.399 of the Act.
[10] Mr Charlton appeared in the conference and gave evidence. His partner, who overheard the phone conversation on 18 May 2015, also gave evidence about that aspect.
[11] JD Trucking was represented by Mr Darren Hicks, who was involved in all of the events leading to this application. Mr Hicks also gave evidence.
[12] The determinative conference was conducted largely in an inquisitorial manner. Given the absence of external representation, appropriate assistance and latitude was provided to facilitate the presentation of each case. 3 However, the parties retained full responsibility for the conduct of their case and the provision of relevant evidence.
[13] Each of the witnesses gave sworn evidence. Mr Charlton had detailed notes of the events and discussions, and his evidence largely supported that version.
[14] Mr Hicks did not give detailed evidence and did not seek to contest much of the applicant’s version of events leading to the alleged dismissal. In addition, whilst he could not recall all of the details of those and subsequent events, he genuinely gave evidence about his version of the major matters.
[15] At the outset of the conference, the following general context was confirmed by both parties: 4
● Mr Bruce Charlton has made an unfair dismissal application against JD Trucking Pty Ltd;
● JD Trucking is a small business under the Act (less than 15 employees at the time of the dismissal);
● Mr Charlton appears to have sufficient service (more than 12 months) to meet the minimum period of employment for a small business and appears to be protected from unfair dismissal;
● Mr Charlton claims that he was dismissed on or about 18 May 2015 and that this was based upon his workers compensation claim and previous absence due to illness;
● JD Trucking claims that the applicant was not dismissed, and may have resigned, and that the need for the applicant to consider other work was raised by Mr Charlton and arose due to the fact that another employee had been engaged to drive the truck previously used by the applicant;
● There is also a dispute about what happened after the events of 18 May 2015 including whether Mr Charlton was offered and refused work that was available with JD Trucking and whether the employer misinformed the authorities about the status of Mr Charlton (as an employee);
● Mr Charlton is seeking four weeks wages as compensation; and
● JD Trucking is seeking that the application be dismissed.
[16] In all of the circumstances the following issues arise from this application:
A. Whether the applicant was dismissed within the meaning of the FW Act. This requires consideration of s.386 Meaning of dismissed of the Act and in particular, whether the applicant’s employment with his employer has been terminated on the employer’s initiative or the applicant has resigned from his employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his employer.
B. If dismissed, whether the dismissal was consistent with the Small Business Fair Dismissal Code (the Code).
C. If not consistent with the Code, whether the dismissal was harsh, unjust or unreasonable. This requires the consideration of those factors set out in s. 387 Criteria for considering harshness etc. of the FW Act.
D. If the dismissal is found to be unfair, whether compensation should be awarded, and is so to what extent, having regard to the considerations set out s.392 of the FW Act.
[17] These issues were also identified to the parties, along with relevant extracts of the FW Act, prior to the determinative conference.
2. Was Mr Charlton dismissed within the meaning of the FW Act?
[18] Given the positions contended by the parties, it is necessary for me to consider whether a dismissal has taken place within the meaning of the Act. Section 386 provides as follows:
“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.”
[19] Although applied under the previous Act, the following approach of the Full Bench of the Australian Industrial Relations Commission in O’Meara v Stanley Works Pty Ltd5 in my view remains generally apposite:
“[21] In this Commission the concepts have been addressed on numerous occasions and by a number of Full Benches. In Pawel v Advanced Precast Pty Ltd (Pawel) a Full Bench said:
“[13] It is plain that the Full Court in Mohazab considered that an important feature in the question of whether termination is at the initiative of the employer is whether the act of an employer results directly or consequentially in the termination of the employment and that the employment relationship is not voluntarily left by the employee. However, it is to be noted that the Full Court described it as an important feature. It plainly cannot be the only feature. An example will serve to illustrate this point. Suppose an employee wants a pay rise and makes such a request of his or her employer. If the employer declines and the employee, feeling dissatisfied resigns, can the resignation be said to be a termination at the initiative of the employer? We do not think it can and yet it can be said that the act of the employer i.e. refusing the pay rise, has at least consequentially resulted in the termination of the employment. This situation may be contrasted with the position where an employee is told to resign or he or she will be terminated. We think that all of the circumstances and not only the act of the employer must be examined. These in our view, will include the circumstances giving rise to the termination, the seriousness of the issues involved and the respective conduct of the employer and the employee. In the instant case the uncontested factual findings are that the applicant had for almost the whole of his employment performed welding duties; that there was no objective threat to his health and safety involved in the requirement that he undertake welding duties so long as it was not on a continuous basis and that the welding he was required to do was not continuous.”
[22] In the Full Bench decision of ABB Engineering Construction Pty Ltd v Doumit (ABB Engineering) it was said:
“Often it will only be a narrow line that distinguishes conduct that leaves an employee no real choice but to resign employment, from conduct that cannot be held to cause a resultant resignation to be a termination at the initiative of the employer. But narrow though it be, it is important that that line be closely drawn and rigorously observed. Otherwise, the remedy against unfair termination of employment at the initiative of the employer may be too readily invoked in circumstances where it is the discretion of a resigning employee, rather than that of the employer, that gives rise to the termination. The remedies provided in the Act are directed to the provision of remedies against unlawful termination of employment. Where it is the immediate action of the employee that causes the employment relationship to cease, it is necessary to ensure that the employer’s conduct, said to have been the principal contributing factor in the resultant termination of employment, is weighed objectively. The employer’s conduct may be shown to be a sufficiently operative factor in the resignation for it to be tantamount to a reason for dismissal. In such circumstances, a resignation may fairly readily be conceived to be a termination at the initiative of the employer. The validity of any associated reason for the termination by resignation is tested. Where the conduct of the employer is ambiguous, and the bearing it has on the decision to resign is based largely on the perceptions and subjective response of the employee made unilaterally, considerable caution should be exercised in treating the resignation as other than voluntary.”
[23] In our view the full statement of reasons in Mohazab which we have set out together with the further explanation by Moore J in Rheinberger and the decisions of Full Benches of this Commission in Pawel and ABB Engineering require that there to be some action on the part of the employer which is either intended to bring the employment to an end or has the probable result of bringing the employment relationship to an end. It is not simply a question of whether “the act of the employer [resulted] directly or consequentially in the termination of the employment.” Decisions which adopt the shorter formulation of the reasons for decision should be treated with some caution as they may not give full weight to the decision in Mohazab. In determining whether a termination was at the initiative of the employer an objective analysis of the employer’s conduct is required to determine whether it was of such a nature that resignation was the probable result or that the appellant had no effective or real choice but to resign.”6
[20] Although determined by the English Court of Appeal, the following approach as taken in CF Capital PLC v Willoughby7 is generally consistent with that taken by Australian Court and Tribunals:
“37. The ‘rule’ is that a notice of resignation or dismissal (whether given orally or in writing) has effect according to the ordinary interpretation of its terms. Moreover, once such a notice is given it cannot be withdrawn except by consent. The ‘special circumstances’ exception as explained and illustrated in the authorities is, I consider, not strictly a true exception to the rule. It is rather in the nature of a cautionary reminder to the recipient of the notice that, before accepting or otherwise acting upon it, the circumstances in which it is given may require him first to satisfy himself that the giver of the notice did in fact really intend what he had apparently said by it. In other words, he must be satisfied that the giver really did intend to give a notice of resignation or dismissal, as the case may be. The need for such a so-called exception to the rule is well summarised by Wood J in paragraph 31 of Kwik-Fit’s case and, as the cases show, such need will almost invariably arise in cases in which the purported notice has been given orally in the heat of the moment by words that may quickly be regretted.
38. The essence of the ‘special circumstances’ exception is therefore that, in appropriate cases, the recipient of the notice will be well advised to allow the giver what is in effect a ‘cooling off’ period before acting upon it. Kilner Brown J, in paragraph [15] of his judgment in Martin’s case understandably referred to such a period as an opportunity for the giver of the notice to recant, or to withdraw his words; and this is in practice what is likely to happen. I would, however, be reluctant to characterise the exception as an opportunity for a unilateral retraction or withdrawal of a notice of resignation or dismissal since that would be to allow the exception to operate inconsistently with the principle that such a notice cannot be unilaterally retracted or withdrawn. In my judgment, the true nature of the exception is rather that it is one in which the giver of the notice is afforded the opportunity to satisfy the recipient that he never intended to give it in the first place – that, in effect, his mind was not in tune with his words.”
[21] Accordingly, the general legal principles to be applied in this case are well settled. Stated succinctly, they include:
● A termination at the initiative of the employer involves the action of the employer as the principal constituting factor leading to the termination;
● The employer must have engaged in some action that intended to bring the employment relationship to an end or had that probable result;
● Considerable caution should be exercised in treating a resignation as other than voluntary and it is necessary to determine whether the employer’s conduct was of such a nature that resignation was the probable result or that the employee had no effective or real choice but to resign;
● In determining the question whether the termination was at the initiative of the employer, an objective analysis of the employer’s conduct is required;
● A termination (or resignation) has effect according to its ordinary terms however in some “special” circumstances the Commission needs to be cautious to ascertain the objective intention and to consider whether it would have been reasonable to permit a retraction or clarification; and
● Subject to the above, a dismissal or resignation, once given, cannot be unilaterally withdrawn.
[22] It is likely that around the time of Mr Charlton’s work injury, he was advised by one of the Directors of JD Trucking to the effect that if he could not pull the ropes (to secure loads and tarps) he could not work as a truck driver.
[23] Mr Charlton’s injury was accepted as a compensable claim and he was paid average weekly earnings in the order of $1,800 per week (gross). Mr Charlton received medical treatment and some rehabilitation in connection with the injury and by mid-May 2015 had received a full medical clearance to return to work.
[24] During Mr Charlton’s absence from the workplace, he became aware that he was required to attend some Court proceedings. Documents associated with that matter were served upon JD Trucking, as the registered owner of the truck being driven by Mr Charlton, however these papers were not forwarded to the applicant. Upon raising his concerns about not being advised or having the papers forwarded to him, a representative of JD Trucking advised Mr Charlton that he was in effect, “on his own”.
[25] On 14 May 2015, Mr Charlton left a voice message on Mr Hick’s phone advising that he had now been cleared to work from the following Monday, 18 May 2015. Mr Charlton also reminded Mr Hicks that he was required to be in Goulburn, New South Wales, on 29 May 2015 to attend the Court proceedings as a result of the earlier matter.
[26] Mr Charlton was a full-time driver and expected to be contacted about the work to be allocated to him prior to Monday 18 May and became concerned that he may not be provided with any further work given the earlier comments about his work capacity (given his injury) and his treatment in connection with the NSW Court appearance.
[27] On Monday 18 May 2015, Mr Charlton sent a text message to Mr Hicks in the following terms:
“G’Day Darren. What’s going on? Or Should I be looking for other work?”
[28] Mr Hicks responded as follows:
“You need to get other work”
[29] Mr Charlton responded by text in the following terms:
“Someone could at least have the courtesy to let me know. I trust that I will receive pay in lieu of notice this week, as well as the final week of workcover pay?”
[30] Mr Hicks then immediately rang Mr Charlton and during a heated conversation accused Mr Charlton of being unreliable, causing the loss of a work contract and refusing to do overnight runs.
[31] Mr Hicks also questioned why he should pay Mr Charlton a week’s pay in lieu of notice and expressed concerns that he may “get the lawyers involved”.
[32] Mr Charlton confirmed that he was only after his legal entitlements and that he would leave the “Workcover” issues to the worker compensation claims agent.
[33] During that conversation Mr Hicks did not indicate that Mr Charlton had not been dismissed and he did not advise that work was or would be made available to the applicant. I also note that Mr Hicks confirmed during the course of this matter, that after that conversation he requested his payroll staff to pay a week in lieu of notice to Mr Charlton. This did occur, albeit sometime after the commencement of these proceedings.
[34] Later that day, Mr Charlton informed the workers compensation claims agent of his apparent dismissal and also sent an email to an individual in a business related to JD Trucking, which undertook the payroll for the employer, seeking a formal notice of termination and the payment of all moneys owed. No response was provided.
[35] On Wednesday 20 May 2015, the claims agent advised Mr Charlton that it had discussed the employer’s legal obligation with Mr Hicks and that the applicant might expect some work to be offered by JD Trucking given that it had to pay Mr Charlton in any event (for the notice period).
[36] On Friday 22 May 2015, Mr Hicks sent a text message to Mr Charlton in the following terms:
“Bruce, do you want to go load at (name of client’s business) and go to Brisbane tonight”
[37] Mr Charlton responded as follows:
“1/ You said you didn’t want me back, remember. 2/ After how you spoke to me on Mon why should I? 3/ I’m due in court next week. 4/ I’m already making arrangements to drive for someone else. So in short, NO! Please send the ‘letter of termination’ asap.”
[38] I will return to whether it was reasonable for Mr Charlton to have declined that work later in this decision.
[39] Mr Charlton lodged this unfair dismissal application on 31 May 2015.
[40] During the course of the determinative conference in this matter, JD Trucking did not strongly contend that Mr Charlton was not dismissed. Rather, it emphasised that it had offered the subsequent work to the applicant and indicated that this work remained available.
[41] It is clear from the text messages on 18 May 2015 that Mr Charlton was seeking confirmation that he still had a job given the absence of any response from the employer. The indication in response that Mr Charlton should seek other work would objectively be understood as meaning that he did not have a job at that point.
[42] During the subsequent phone call, there was no suggestion that Mr Charlton’s presumption that the employment had ended was incorrect and there was no indication at that point that there was to be any further work offered.
[43] Further, arising from that discussion, JD Trucking ultimately acknowledged that it should pay the applicant in lieu of notice and Mr Hicks gave instructions that this was to be done. Although this was subsequently delayed and not done for some period, this acknowledgement is consistent with a dismissal having taken place.
[44] The subsequent offers of work and the fact that JD Trucking has not taken Mr Charlton out of its administrative system, do not mean that a dismissal did not take place. They are however relevant to other matters to be determined in this matter.
[45] Accordingly, I am satisfied that there was a dismissal within the meaning of the Act.
3. Was the dismissal consistent with the Code?
[46] Section 385 of the Act provides as follows:
“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.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.”
[47] This means that if Mr Charlton’s dismissal was consistent with the Code, it cannot be considered to be unfair within the meaning of the Act. Section 396 of the Act also requires, in effect, that matters arising from s.385 are to be decided before dealing with the merits of the application.
[48] The Code as declared is set out as follows:
“The Code
Summary Dismissal
It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.
Other Dismissal
In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.
The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement. The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.
Procedural Matters
In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.
A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.”
[49] Accordingly, for an employer to believe on reasonable grounds that the conduct of the employee was serious enough to justify immediate dismissal, the employer must establish that it did in fact hold the belief that:
● the conduct was by the employee;
● the conduct was serious; and
● the conduct justified immediate dismissal.
[50] JD Trucking did not contend that Mr Charlton had undertaken any misconduct that would justify summary dismissal.
[51] JD Trucking also accepted that whilst it did have some concerns about elements of Mr Charlton’s job performance, it did not warn the applicant about these matters and there was no indication to the applicant that his employment was at risk.
[52] JD Trucking did, appropriately in my view, point to the fact that it had engaged a casual driver to fill in for the applicant during his long absence and this was part of the reason why it did not get back to the applicant immediately. However, Mr Charlton was fit for work and was therefore due to resume his full-time employment and the need to make arrangements in terms of work for the casual employee did not provide a valid reason for dismissal.
[53] Accordingly, JD Trucking has also not demonstrated compliance with the “Other Dismissal” or “Procedural Matters” of the Code.
[54] Given all of these circumstances, the dismissal was not consistent with the Code.
4. Was the dismissal unfair within the meaning of the Act?
[55] Given the above findings, I need to consider whether the dismissal of Mr Charlton was unfair.
[56] Section 387 of the Act provides as follows:
“387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC 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 the FWC considers relevant.”
[57] It is clear that s.387 of the Act contemplates that an overall assessment as to the nature of the dismissal must be made by the Commission. In so doing, the Act sets out a number of considerations that must, where relevant, be weighed up in totality.
[58] It is convenient therefore to use the various provisions of s.387, with reference to the relevant circumstances, to outline my consideration of the matter.
Section 387(a) – whether there was a valid reason for the dismissal related to Mr Charlton’s capacity or conduct (including its effect on the safety and welfare of other employees)
[59] Valid in this context is generally considered to be whether there was a sound, defensible or well-founded reason for the dismissal. Further, in considering whether a reason is valid, the requirement should be applied in the practical sphere of the relationship between an employer and an employee where each has rights, privileges, duties and obligations conferred and imposed on them. That is, the provisions must be applied in a practical, common sense way to ensure that the employer and employee are each treated fairly.8
[60] It is also clear from the authorities that the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts before the Commission. That is, it is not enough for an employer to rely upon its reasonable belief that the termination was for a valid reason.9 Equally, facts justifying dismissal, which existed at the time of the termination, should be considered, even if the employer was unaware of those facts and did not rely on them at the time of dismissal.10
[61] Mr Hicks confirmed that he had some concerns about the performance and work of Mr Charlton. However, during the course of the determinative conference, the employer did not contend that there were valid reasons for dismissal. There was also little or no evidence provided that would support any such finding.
[62] In that regard, I do note that Mr Hicks raised a suggestion of a concern about whether Mr Charlton had disclosed the full circumstances leading to him seeking work with JD Trucking; however it was not clear to me whether this was being relied upon as providing a valid reason. In any event, there was insufficient evidence for the Commission to determine the merit or otherwise of that suggestion.
[63] Based upon the evidence before the Commission, there was not a valid reason for Mr Charlton’s dismissal at that time.
Section 387(b) – whether Mr Charlton was notified of the reasons for dismissal
[64] This consideration requires the Commission to assess whether the applicant concerned was relevantly notified of the reasons leading to the dismissal before that decision was taken.11
[65] There were no valid reasons and no notification took place within the contemplation of this consideration.
Section 387(c) – whether Mr Charlton was given an opportunity to respond to any reason related to his capacity or conduct
[66] The process contemplated by the Act does not require any formality and is to be applied in a common sense way to ensure the employee has been treated fairly. There were no valid reasons but to the extent that there were concerns held by JD Trucking this question might become whether Mr Charlton was aware of the precise nature of the employer’s concern about his conduct and had a full opportunity to respond to these concerns.12
[67] This did not happen in this case.
Section 387(d) – any unreasonable refusal by the respondent to allow Mr Charlton a support person
[68] There was no request for a support person and accordingly this consideration is not relevant.
Section 387(e) – if the dismissal is related to unsatisfactory performance by Mr Charlton – whether he has been warned about that unsatisfactory performance before the dismissal.
[69] This consideration relates to performance of the job. Performance in this context includes the employee’s capacity to do the work, and the diligence and care taken with that work.13
[70] There were no discussions between JD Trucking and Mr Charlton that would represent any warnings about unsatisfactory performance as contemplated by this consideration.
Section 387(f) – the degree to which the size of the respondent’s enterprise would be likely to impact on the procedures followed in effecting the dismissal.
Section 387(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.
[71] JD Trucking is a small business and does not have dedicated human resource expertise and this would have impacted upon how the issues leading to the dismissal were handled.
[72] This is a factor to be taken into account and some allowance should be made accordingly.
Section 387(h) - other matters considered to be relevant
[73] I will consider the events following the dismissal later in this decision. They are not presently relevant to the assessment of the dismissal itself.
[74] In Parmalat Food Products Pty Ltd v Mr Kasian Wililo,14 the Full Bench observed:
“[24] ... ... The existence of a valid reason is a very important consideration in any unfair dismissal case. The absence of a valid reason will almost invariably render the termination unfair. The finding of a valid reason is a very important consideration in establishing the fairness of a termination. Having found a valid reason for termination amounting to serious misconduct and compliance with the statutory requirements for procedural fairness it would only be if significant mitigating factors are present that a conclusion of harshness is open.”
[75] In this case there was no misconduct and no valid reason for dismissal has been provided by JD Trucking.
[76] Amongst other considerations, the Commission should consider the impact of the dismissal upon the applicant given all of the circumstances. This includes consideration as to whether the dismissal was harsh in the sense that it was disproportionate to any actual conduct found by the Commission.15
[77] Mr Charlton was not a long-serving employee however the loss of his employment in his circumstances is significant and has impacted upon his future employment prospects to some degree.
Conclusion on nature of dismissal
[78] As outlined earlier, the Act requires a global assessment having regard to the various relevant statutory considerations. In that context, procedural unfairness is an important consideration given the provisions of the Act but does not necessarily mean that the dismissal was unfair. This is reinforced by the objects relating to Part 3-2 Unfair Dismissal of the FW Act in s.381 which relevantly provides as follows:
“381 Object of the Part
… …
(2) The procedures and remedies referred to in paragraphs (1)(b) and (c), and the manner of deciding on and working out such remedies, are intended to ensure that a “fair go all round” is accorded to both the employer and employee concerned.
Note: The expression “fair go all round” was used by Sheldon J in in re Loty and Holloway v Australian Workers’ Union [1971] AR (NSW) 95.”
[79] As revealed in various decisions of the Commission (and the Court), each case must be considered in its own circumstances and it is appropriate, amongst other factors, to have regard to whether the procedural deficiencies made any difference to the outcome.16
[80] Given the absence of a valid reason for dismissal at that point and the manner in which it took place, I am satisfied that the dismissal of Mr Charlton was harsh, unjust and unreasonable.
5. Remedy
[81] Division 4 of Part 3-2 of the FW Act relevantly provides as follows:
“Division 4—Remedies for unfair dismissal
390 When the FWC may order remedy for unfair dismissal
(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of compensation to a person, if:
(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) the FWC may make the order only if the person has made an application under section 394.
(3) the FWC must not order the payment of compensation to the person unless:
(a) the FWC is satisfied that reinstatement of the person is inappropriate; and
(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.
Note: Division 5 deals with procedural matters such as applications for remedies.
...
- 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), 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.
Misconduct reduces amount
(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.
Shock, distress etc. disregarded
(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.
Compensation cap
(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:
(a) the amount worked out under subsection (6); and
(b) half the amount of the high income threshold immediately before the dismissal.17
(6) The amount is the total of the following amounts:
(a) the total amount of remuneration:
(i) received by the person; or
(ii) to which the person was entitled;
(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and
(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.
393 Monetary orders may be in instalments
To avoid doubt, an order by the FWC under subsection 391(3) or 392(1) may permit the employer concerned to pay the amount required in instalments specified in the order.”
[82] The prerequisites of ss.390(1) and (2) have been met in this case.
[83] Section 390 makes it clear that compensation is only to be awarded as a remedy where the Commission is satisfied that reinstatement is inappropriate and that compensation is appropriate in all the circumstances. Mr Charlton does not seek reinstatement and given all of the prevailing circumstances and my findings I accept that reinstatement would be inappropriate.
[84] As a result, I need to consider whether compensation is appropriate, and if so, to what extent.
[85] A recent Full Bench in McCulloch v Calvary Health Care Adelaide18 (McCulloch) confirmed, in general terms, that the approach to the assessment of compensation as undertaken in cases such as Sprigg19 remains appropriate in that regard.
[86] Section 392(2) of the Act requires me to take into account all of the circumstances of the case including the factors that are listed in paras (a) to (g). Without detracting from the overall assessment required by the Act,20 it is convenient to discuss the identified considerations under the various matters raised by each of the provisions.
The effect of the order on the viability of JD Trucking
[87] JD Trucking did raise concerns about the state of the transport industry and its impact upon the business. Nothing has been put to the Commission by way of documentary evidence to support these concerns and this does not sit well with the indication that work for Mr Charlton remained available to the time of the determinative conference. In any event, the level of compensation that I have determined is unlikely to have any impact upon the viability of the employer.
[88] The size and nature of the business is however relevant to the terms of any order made.
The length of Mr Charlton’s service with JD Trucking
[89] Mr Charlton was employed between late October 2013 and mid May 2015.
[90] This is not a significant length of service and is to be taken into account in determining whether compensation should be awarded and if so, to what extent.
The remuneration Mr Charlton would have received, or would have been likely to receive, if he had not been dismissed
[91] This involves in part a consideration of the likely duration of Mr Charlton’s employment in the absence of what I have found to be an unfair dismissal.
[92] The Full Bench in McCulloch also confirmed that when assessing likely lost remuneration, cogent evidence was required for any assumption that a short period of likely future employment would have occurred where the Commission had not found a valid reason for dismissal.21
[93] In this case, I have not found a valid reason for dismissal. There were legitimate concerns for JD Trucking that arose from the need to fairly deal with the replacement casual employee who was engaged during Mr Charlton’s absence. This may explain why no immediate work was allocated but is not a valid reason for the applicant’s dismissal.
[94] The employment relationship was in the order of 18 months and there were some tensions and issues that arose between the parties. This was not a particularly stable employment relationship and it was evident to me that although Mr Charlton was dismissed, he was in reality keen to move on. This is reflected in his unwillingness to genuinely consider any of the subsequent offers of work as made by JD Trucking.
[95] In all of the rather unique circumstances evident in this matter it is reasonable to assess the compensation in this matter on the basis that the applicant would, on the balance of probabilities, have remained in employment only for a short period. This further period would have been no more than the period of some eight weeks, including a period of notice.
[96] The average weekly remuneration as agreed by the parties was $1,800 (gross).
[97] Accordingly, the projected remuneration loss for present purposes is $14,400.
The efforts of Mr Charlton to mitigate the loss suffered by him because of the dismissal
[98] JD Trucking offered work to Mr Charlton immediately after the dismissal and subsequently, although based upon the limited evidence before the Commission the details of those proposals are sketchy.
[99] Mr Charlton accepted that further offers of work were made although he suspected that these offers were only strategic. The fact that these offers were not explored or genuinely considered by Mr Charlton, particularly given that he had not been successful in gaining further employment, is a factor to be taken into account.
[100] However, I do note that the first offer of work was problematic for Mr Charlton given that if he accepted that work, he would not have been able to attend his New South Wales Court “appointment”.
[101] It is also clear that Mr Charlton made significant efforts to obtain alternative employment and this must also be taken into account.
[102] In all of the circumstances, a discount of 50 per cent would be appropriate on the grounds of mitigation.
The amount of any remuneration earned by Mr Charlton from employment or other work during the period between the dismissal and the making of the order for compensation
The amount of any income reasonably likely to be so earned by Mr Charlton during the period between the making of the order for compensation and the actual compensation
[103] Mr Charlton ultimately received payment of in lieu of notice and this amount is to be taken into account.
[104] There is no evidence of other remuneration earned by Mr Charlton from employment that is relevant to this present assessment.
Any other matter that the FWC considers relevant and the remaining statutory parameters
[105] After what I have found to be the dismissal, JD Trucking indicated to the workers compensation claims agent and to Centrelink that it had not dismissed Mr Charlton. Although I have found that a dismissal did take place, this was in dispute and the employer had offered some further work.
[106] The impact of its conduct in that regard may have delayed access to other benefits for Mr Charlton however in this case, he ultimately received those payments.
[107] There is no demonstrated misconduct that may be taken into account as provided by s.392(3) of the Act.
[108] In accordance with s.392(4) of the Act, I make no allowance for any shock, distress or humiliation that may have been caused by the dismissal.
[109] The amount of compensation that I have determined is far less than the maximum prescribed by s.392(5) of the Act as applied in this matter.22
[110] The figures used for the calculation are expressed in gross terms and appropriate taxation is to be deducted on the final amount of compensation.
[111] Although the Commission is not bound by the positions of the parties, 23 the fact that Mr Charlton confirmed during both the directions conference and the subsequent determinative conference that he would not be seeking more than four weeks wages as compensation is in my view a relevant consideration. That position may well have impacted the decisions made by the employer in relation to its approach to the arbitration of the matter and did impact upon the range of issues the Commission pursued with the parties during the determinative conference. I note that the compensation figure derived from the other considerations is in any event marginally less than the maximum amount claimed by the applicant.
[112] The compensation amount confirmed below is also appropriate having regard to all of the particular circumstances of this matter and the Commission’s statutory charter to ensure that a “fair go all round” is accorded to both the employer and employee concerned. 24
Conclusions on remedy
[113] After taking into account each of the relevant considerations, I find that compensation is appropriate in this matter. Further, I find that the compensation should be assessed having regard to the factors outlined above.
[114] I find that compensation should comprise a payment by JD Trucking to Mr Charlton of $6,300.
7. Conclusions and orders
[115] I find the Mr Charlton was dismissed and that the dismissal was unfair within the meaning of the Act.
[116] I have found that compensation is appropriate and the amount determined above is also appropriate in all of the circumstances.
[117] The payment of $6,300, less any required deduction of taxation, is to be made to Mr Charlton by JD Trucking within 28 days of this decision.
[118] An order25 to that end has been issued in conjunction with this decision.
COMMISSIONER
Appearances:
B Charlton, the applicant in person.
D Hicks, on behalf of JD Trucking.
Hearing details:
Determinative conference
2015
Adelaide
August 21.
1 Section 23 of the FW Act.
2 Section 397 of the FW Act.
3 This was done in a manner consistent with the statutory charter of the Fair Work Commission. See the discussion of some of the relevant considerations for a similar Tribunal in Minogue v HREOC [1999] FCA 85.
4 These matters were also provided in advance to the parties along with directions to lodge relevant evidence and submissions.
5 PR973462, 11 August 2006 per Giudice J, Watson VP and Cribb C. This appeal was determined under the provisions of the Workplace Relations Act 1996 pursuant to the provisions of the Act as in force prior to the coming into operation of the Workplace Relations Amendment (Work Choices) Act 2005. As a result, the primary jurisdictional question was whether the applicant had been dismissed by the employer which was considered having regard to the formulation in the Termination of Employment Convention which in turn referred to termination at the initiative of the employer.
6 PR973462 (footnotes omitted).
7 Court of Appeal (Civil Division) per Rimer LJ [2011] EWCA 1115. See also Gunnedah Shire Council v Grout (1995) 134 ALR 145.
8 Selvachandran v Peterson Plastics Pty Ltd (1995) 62 IR 371 as cited in Potter v WorkCover Corporation, (2004) 133 IR 458 per Ross VP, Williams SDP, Foggo C and endorsed by the Full Bench in Industrial Automation Group Pty Ltd T/A Industrial Automation [2010] FWAFB 8868, 2 December 2010 per Kaufman SDP, Richards SDP and Hampton C at par [36].
9 See Australia Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1; King v Freshmore (Vic) Pty Ltd AIRCFB Print S4213 per Ross VP, Williams SDP, Hingley C, 17 March 2000; Edwards v Giudice (1999) 94 FCR 561; Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport AIRCFB Print S5897 per Ross VP, Acton SDP and Cribb C, 11 May 2000 and Rode v Burwood Mitsubishi AIRCFB Print R4471 per Ross VP, Polites SDP, Foggo C, 11 May 1999.
10 Shepherd v Felt & Textiles of Australia Ltd (1931) 45 CLR 359, 373, 377‒378; Australia Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1, 14. See also Dundovich v P & O Ports AIRC PR923358 8 October 2002, per Ross VP, Hamilton DP, Eames C at [79]; Lane v Arrowcrest (1990) 27 FCR 427, 456; cited with approval in Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410, 467 and 468.
11 See Trimatic Management Services Pty Ltd v Daniel Bowley [2013] FWCFB 5160.
12 RMIT v Asher (2010) 194 IR 1. See also Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137 at [75].
13 See Anetta v Ansett Australia Ltd (2000) 98 IR 233.
14 [2011] FWAFB 1166.
15 Australia Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1.
16 See Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport AIRCFB Print S5897 per Ross VP, Acton SDP and Cribb C, 11 May 2000 and Villani v Holcim (Australia) Pty Ltd [2011] FCAFC 155 as examples.
17 Note: the subsection 392(5) amount was indexed to $133,000 from 1 July 2014 - as was relevant given the timing of this application.
18 [2015] FWCFB 873.
19 Sprigg v Paul’s Licensed Festival Supermarket (1998) 88 IR 21. See also Bowden v Ottrey Homes Cobram and District Retirement Villages Inc T/A Ottrey Lodge[2013] FWCFB 431.
20 Smith and Others v Moore Paragon Australia Ltd (2004) 130 IR 446.
21 McCulloch at [27].
22 The maximum compensation limit in this case would be the lesser of 26 weeks remuneration or $66,500.
23 Section 599 of the FW Act.
24 Section 381(2) of the FW Act. See also Smith and Others v Moore Paragon Australia Ltd (2004) 130 IR 446 at par [32].
25 PR571252.
Printed by authority of the Commonwealth Government Printer
<Price code C, PR571102>
0
16
0