Mr Christopher Sheppard v Rivershow Pty Ltd

[2013] FWC 7829

[2013] FWC 7829

FAIR WORK COMMISSION

DECISION

AND

REASONS FOR DECISION

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

Mr Christopher Sheppard
v
Rivershow Pty Ltd
(U2013/816)

COMMISSIONER CLOGHAN PERTH, 14 OCTOBER 2013

Application for relief from unfair dismissal.

[1] This is an application by Mr Sheppard seeking a remedy for alleged unfair dismissal from his employer.

[2] Mr Sheppard was dismissed by text message following an exchange of text messages with his employer in which he queried when he would be paid for the preceding two weeks work.

PROCEDURAL BACKGROUND

[3] On 16 March 2013, Mr Christopher Sheppard (Applicant) made application to the Fair Work Commission (Commission) seeking a remedy for alleged unfair dismissal from his employment with Kieron and Lisa Strahan: The K L Strahan Trading Trust & Others T/A Duckstein Brewery (Employer named in the application).

[4] The application was made pursuant to s.394 of the Fair Work Act 2009 (FW Act).

[5] The application was forwarded to the Employer named in the application on 22 March 2013.

[6] On 22 March 2013, the parties were advised of a conciliation conference scheduled for 12 April 2013.

[7] On 9 April 2013, the Employer named in the application advised the Commission that it sought to proceed directly to arbitration.

[8] The application was referred to me for arbitration on 24 April 2014.

[9] On 30 April 2013, I issued procedural directions for an arbitral hearing on 15 July 2013. With the agreement of the parties, the hearing was adjourned to 9 September 2013.

[10] On 14 May 2013, the Employer named in the application provided its response to Mr Sheppard’s application for unfair dismissal. The Employer named in the application states in its response that the employer is:

“The KL Strahan Trading Trust, The GM Smith Trading Trust, The McGuire Trading Trust, The LJ Reid Trading Trust, The Forster Trading Trust and the Capelli Trading Trust T/A Duckstein Brewery”.

[11] The Employer named in the application agrees that the Applicant was employed from 24 July 2012 to 6 March 2013. Further, notification of dismissal and dismissal took effect on the same day - 6 March 2013.

[12] In relation to the questions “what were the reasons for dismissal?” and “what is your response to the Applicant’s contentions?”, the Employer named in the application responded: “Not required”.

[13] With respect to a jurisdictional objection, the Employer named in the application states:

“The Duckstein Brewery is operated through a partnership of trading trusts which is specifically excluded from unfair dismissal laws. This is set out in the guide to unfair dismissal laws on the FWC website.”

[14] Compliance with the procedural directions resulted in an email exchange to such an extent that, on 2 August 2013, I waived any further compliance. My Associate advised the parties that the Commission would receive all submissions and evidence related to the application at the hearing on 9 September 2013.

[15] I emphasised to the parties on 2 August 2013 that should either party not attend, I would apply the provisions of s.600 of the FW Act and determine the matter in the absence of any party required to attend.

[16] At the hearing on 9 September 2013, the Applicant represented himself and gave evidence on his own behalf.

[17] The Employer named in the application did not attend the hearing or advise the Commission why it was unable to attend.

[18] Having received the parties’ written material as a result of the procedural directions, oral evidence and submissions, I reserved my decision. This is my decision and reasons for decision.

RELEVANT BACKGROUND

[19] The Applicant was employed as a Yard and Maintenance Man on 24 July 2012. Mr Sheppard gave evidence that he initially worked three (3) hours for each of the five (5) trading days at the Duckstein Brewery. In addition, he worked additional “quarterly” days and regularly extended hours on the five (5) trading days. Finally, Mr Sheppard did further work on what he described as closed trading days. 1

[20] Approximately three (3) weeks before his dismissal, the Duckstein Brewery commenced trading six (6) days per week. When the Duckstein Brewery commenced trading six (6) days per week, Mr Sheppard increased his working hours to six (6) hours per day.During this period, Mr Sheppard also worked extended hours on days when the Duckstein Brewery was closed. 2

[21] From 24 July 2012 to the day of his dismissal, Mr Sheppard gave evidence that he worked every trading day with the exception of one - the day he was dismissed. 3

[22] When the Duckstein Brewery was trading five (5) days per week, Mr Sheppard was earning $25 per hour. When the Applicant’s hours increased to six (6) hours per day for six (6) days per week, Mr Sheppard gave evidence that he was paid $22 per hour. 4

[23] On 6 March 2013, Mr Sheppard enquired of his Employer via a text message at 7:31 am as to when he would receive his first fortnightly pay consisting of 72 hours per fortnight.

[24] Mr Strahan responded:

“I am working full time at the moment so it is a bit hard to get it done on time. Some were paid after 4pm. I can’t tell if U were one of them.” 5

[25] Mr Sheppard attempted unsuccessfully to telephone Ms Strahan (Mr Strahan’s wife). Being unsuccessful, Mr Sheppard texted Ms Strahan.

[26] The essence of Mr Sheppard’s text message at 10:32 am to Ms Strahan is that: he cannot see any reason why he was not paid; cannot commit to six (6) days per week if he is not routinely paid every fortnight; relies upon his fortnightly salary and wishes to speak to Ms Strahan.

[27] At 10.58 am Mr Strahan sent a text message to Mr Sheppard:

“Don’t both coming in tomorrow. I have decided to make alternative arrangements. I don’t like the way you talk to us and don’t need it in my life. By the way you were paid yesterday at around 2.00 pm”. 6

[28] On 10 March 2013, Mr Sheppard received his pay slip for the period 25 February to 10 March 2013. Whereas in the previous fortnight, Mr Sheppard received 72 hours cleaning at $22 per hour, in his last fortnightly pay he received 12 hours cleaning at $22 per hour, 3.5 hours maintenance at $25 per hour and 32 hours “severance pay” at $22 per hour. Mr Sheppard describes the “severance pay” as pay in lieu of notice. 7

[29] On 20 May 2013, Mr Sheppard obtained further employment 8.

[30] During the period between his dismissal on 6 March 2013 and commencing employment again on 20 May 2013, Mr Sheppard joined two labour hire organisations, obtained a fork lift license, sought employment through “word of mouth”, looked on SEEK and updated his resume 9.

RELEVANT STATUTORY FRAMEWORK

[31] Section 385 of the FW Act sets out the meaning of unfair dismissal 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) ...

(d) ...”

[32] The criteria for whether a dismissal was harsh, unjust or unreasonable can be found at s.387 of the FW Act and is 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.”

IS THE APPLICANT PROTECTED BY THE UNFAIR DISMISSAL PROVISIONS OF THE FW ACT?

[33] The Employer named in the application asserts that the Duckstein Brewery is operated through a partnership of trading trusts which is specifically excluded from the unfair dismissal provisions of the FW Act. The Employer named in the application has provided the names of the various trading trusts.

[34] Mr Sheppard has provided his PAYG payment summary for the year ending 30 June 2013. The payer name is Rivershow Pty Ltd and the name of the authorised person signing the payment summary is Mr Strahan. 10

[35] The Australian Securities and Investments Commission (ASIC) extract for Rivershow Pty Ltd indicates that it is an Australian Proprietary Company registered in Western Australia on 21 October 2002. The Company’s principal place of business is Lot 9720 West Swan Road, Henley Brook - this is also the address of the Duckstein Brewery. 11

[36] One of the Directors and Company Secretary is Mr Strahan. Mr Strahan is also a shareholder.

[37] I am satisfied that Mr Sheppard was employed by Rivershow Pty Ltd (Employer) and that pursuant to the Dictionary and s.380 of the FW Act, is a national system employer. Accordingly, Part 3-2 of the FW Act relating to unfair dismissals applies to the Employer. Consequently, I am satisfied that Mr Sheppard is protected from unfair dismissal.

[38] In accordance with s.586 of the FW Act, I am satisfied that it is appropriate to amend the application to name Rivershow Pty Ltd as the employer to this application.

IS THE EMPLOYER A SMALL BUSINESS EMPLOYER PURSUANT TO THE FW ACT?

[39] It is necessary to consider whether the Employer is a small business employer within the definition of the FW Act. Due to the non appearance of the Employer at the hearing, I am required to make an assessment of the material provided as a result of the procedural directions. I have a “Payroll Activity [Summary]” for the Duckstein Brewery for the period 19 February 2013 to 4 March 2013 which consists of 17 employees. I have a similar Payroll Activity [Summary] for the fortnight 5 March to 18 March 2013 which consists of 13 employees. 12

[40] Of the 13 employees in the period 5 March to 18 March 2013, 12 persons appear in the previous fortnightly pay period. Of the 17 employees in the period 19 February to 4 March 2013, only one (1) person appears not to have been employed in the previous two (2) fortnightly pay periods. Consequently, it is uncertain whether the Employer is a small business employer or not.

[41] While there may be uncertainty whether the Duckstein Brewery at Henley Brook has less than 15 employees, there is a “sister” brewery of the same name at Wilyabrup. The evidence provided by the Applicant 13 indicates they are related entities and combined have a total number of employees greater than 15 employees. Accordingly, I am satisfied, in the absence of any contrary evidence, that the Employer is not a small business employer.

CONSIDERATION OF STATUTORY FRAMEWORK

Was there a valid reason for the Applicant’s dismissal? - s.387(a)

[42] I have adopted the definition of a valid reason stated by North J in Selvachandran v Peterson Plastics Pty Ltd (Selvachandran) (1995) 62 IR 371 at 373 in the following terms:

“In its context in s.170DE(1), the adjective “valid” should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s.170DE(1). At the same time the reasons must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must ‘be applied in a practical, commonsense way to ensure that the employer and employee are treated fairly’.”

[43] The uncontested evidence before the Commission with respect to Mr Sheppard’s dismissal is simply that he queried, by text message with his Employer at 7:31 am on 6 March 2013, if he had been paid, and if not, when he would be paid. In making the query, Mr Sheppard explained his financial circumstances. Having received an indeterminate text response from Mr Strahan, the Applicant followed up his query with Ms Strahan at 10:32 am on the same day. Mr Sheppard’s text messages are not vulgar or brusque but simply question why he cannot be paid on time and the uncertainty of Mr Strahan’s response.

[44] Mr Sheppard’s text message to Ms Strahan at 10:32 am includes the following:

“Kieron [Mr Strahan] cannot tell me if I have been paid or not, he only advised “some” have been paid which means or assumed there is not enough funds to pay everyone. He also explains he is committed elsewhere and does not have the time to process pays? How am I supposed to take this and rely on money each fortnight? If you want me to clean for tomorrow’s trade, then I need to speak to you first Lisa [Ms Strahan].” 14

[45] While the latter part of the text message may be considered impertinent or impetuous, it is at the very lower end of negative employee demeanour which, in my view, does not substantiate immediate dismissal by the Employer 35 minutes later with the reason “I don’t like the way you talk to us”. 15

[46] Consistent with Selvachandran, the Employer’s reason for Mr Sheppard’s dismissal on an objective assessment of the facts is not sound or defensible. In the absence of any submission or evidence from the Employer, it appears to have been an outcome that Mr Sheppard could not, and would not, have predicted from his text message.

Notification of the reason for termination of employment - s.387(b)

[47] The Applicant was notified on the reason for his dismissal which is discussed above in paragraphs [43] to [46].

Opportunity to respond - s.387(c)

[48] The evidence provided to the Commission is that Mr Sheppard was not given an opportunity to respond to his dismissal.

Support person - s.387(d)

[49] The circumstances of the dismissal did not present an opportunity for the Applicant to request and be unreasonably denied by the Employer of a support person.

Unsatisfactory performance - s.387(e)

[50] The events leading to Mr Sheppard’s dismissal did not involve matters concerning his performance.

Size of the enterprise - s.387(f); and

Human resources - s.387(g)

[51] In the absence of any evidence from the Employer, I am unable to determine whether it had access to human resource expertise. It is inappropriate for the Commission to speculate what may have happened if the Employer had access to human resource expertise, however, there would be no shortage of options on how the matter could have been dealt with differently.

[52] I am satisfied that while the size of the Employer, and what appears to be a lack of human resource advice, were factors in Mr Sheppard’s dismissal, the reality of the manner in which the dismissal occurred did not lend itself to a consideration or attention to the substantive reasons or procedural matters.

Other matters - s.387(h)

[53] I have not taken any other matters into consideration.

CONCLUSION

[54] Having considered the submissions and tendered evidence, I am satisfied that Mr Sheppard’s dismissal was unfair in accordance with the criteria in s.387 of the FW Act.

[55] Having found that Mr Sheppard was unfairly dismissed from his employment, it is necessary to consider the appropriate remedy for that unfairness.

[56] Mr Sheppard is not seeking reinstatement, and in any event, I am satisfied for the reasons set out above that it would be inappropriate. Consequently, I consider an award of compensation is appropriate.

COMPENSATION

[57] The relevant parts of s.392 of the FW Act are as follows:

“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.”

[58] An order for compensation will be made after I have provided an opportunity for the Employer to make a submission on the matter. Mr Sheppard will have an opportunity to respond to the Employer’s submission, if any. My Associate will contact both parties regarding the submissions.

[59] In assessing compensation, Mr Sheppard gave evidence that with the exception of the last three (3) weeks of his employment, his core working hours were three (3) hours per day for five (5) days per week. In the last three weeks, he was employed for six (6) hours per day for six (6) days of the week. When working five (5) days a week, Mr Sheppard was paid $25 per hour but this was reduced to $22 per hour when he increased his working days to six (6) per week. Further, on termination he received severance pay of $704.00 gross.

COMMISSIONER

Appearances:

C Sheppard, the Applicant.

No appearance or representation by or on behalf of the Respondent.

Hearing details:

2013:

Perth,

9 September.

 1   Applicant’s application

 2   Transcript PN60

 3   Transcript PN51

 4   Transcript PN68

 5   Exhibit A8

 6   Exhibit A8

 7   Exhibit A8

 8   Transcript PN83

 9   Transcript PN81

 10   Exhibit A1

 11   Exhibit A2

 12   Exhibit R1

 13   Exhibit A3

 14   Exhibit A8

 15   Exhibit A8

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