Mr Eden Simonini v Piccola Scuderia Pty Ltd
[2010] FWA 9729
•23 DECEMBER 2010
[2010] FWA 9729 |
|
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Mr Eden Simonini
v
Piccola Scuderia Pty Ltd
(U2010/11307)
SENIOR DEPUTY PRESIDENT DRAKE | SYDNEY, 23 DECEMBER 2010 |
Termination of employment.
[1] I heard this application in Sydney on 4 and 5 November 2010. Mr Simonini was represented by his wife, Ms Cristina Ferraris, who was also his support person. He had the support of an interpreter. Mr Andrews, solicitor of Pryor Tzannes & Wallis, appeared for Piccola Scuderia Pty Ltd (Piccola).
[2] I delivered a decision in transcript at the conclusion of the hearing on 5 November 2010 which I have set out below with some editing.
“THE SENIOR DEPUTY PRESIDENT: Thank you. Often in these matters I reserve my decision but in this case I think I'm in a position to deliver my finding now and I intend to do so. I'll deliver my findings and then I will publish my findings and any resultant order in due course. I will not be publishing reasons for decision unless requested in writing to do so. I have found that Mr Simonini ------ was employed by the respondent as a permanent employee from mid-2000 until 27 August 2010. There is a dispute between the parties about how that employment came to an end.
In this respect I will make the following findings. I find that Mr Simonini attended work on 26 and 27 July 2010. I find that Mr Simonini was not constructively dismissed on 27 July 2010. I find that Mr Simonini did not abandon his employment on 27 July 2010. I find that Mr Simonini's employment was terminated by correspondence dated 27 August 2010, which notice of termination was presumably effective on 27 August 2010. I find that the termination of Mr Simonini's employment on 27 August was harsh, unjust, or unreasonable in all the circumstances of this case.
I've given specific consideration to remedy as a result of that final finding in relation to harsh, unjust, or unreasonable. The relationship between Mr Simonini and Mr Masi, was I find, affected by a terminal illness of disaffection and distance between them. It seems to me that their relationship was in its final stages. Had Mr Simonini's employment not been terminated by Mr Masi on 27 August 2010 I have concluded that it would, in any event, have died a natural death from these serious issues. Mr Simonini was already suffering from the effect of the deterioration of that relationship by its effect on his health. He had already decided that he could no longer proceed in the face of the disaffection he felt from Mr Masi.
Mr Masi was already exhibiting distrust in Mr Simonini's performance, I make no comment about whether that was justified or not. In this respect I entirely reject the evidence of Mr Colatruglio who, it seems to me, was a volatile, unreliable, and - simply a volatile and unreliable witness. For these reasons I've decided that the employment of Mr Simonini would not, in any event, have lasted more than eight weeks from the date of termination of employment. At which time he would have been entitled, had his employment been terminated by Mr Masi for the reasons I've outlined or by him, as a result of his dissatisfaction, to four weeks' notice.
I have therefore decided to award Mr Simonini 12 weeks' compensation. I note the financial position of Mr Masi, and that he does conduct a small business. I intend in my order to make an allowance for that - an order that the payment of the compensation to be paid over a number of payments over a number of weeks which I'll set out in the order. I note that Mr Simonini has been employed --- in full-time permanent employment for in excess of 10 years. As a consequence it is clear that he's entitled to payment of long-service leave relating to his employment, less any long service leave he has already taken.
He would also be entitled to an accrued annual leave. These are not matters that are the subject of these proceedings. They can be the subject of proceedings for recovery in another place. I recommend that the parties have a conversation about that matter, the recovery of these entitlements. I recommend that these be identified and that an agreement be reached about payment to save the parties the expense and irritation of further proceedings.
It's possible that these matters can be resolved by arrangement for part payment as well, should Mr Masi be in a difficult financial position. There are no further matters I wish to attend to.------” 1
[3] In subsequent correspondence Mr Andrews indicated that he thought the decision contained an error which could be amended by “the slip” rule. I listed the application for mention on 22 November 2010 to ascertain what Mr Andrews intended by his letter. Mr Andrews was not referring to any error of the kind amenable to correction in the manner suggested. I therefore issued no correction. On that occasion I also took the opportunity to encourage Mr Andrews to indicate whether or not he intended to make any further submissions concerning payment of my order by instalments. There has been some submissions from both parties regarding this issue since that date.
[4] Mr Simonini considered that he had been constructively dismissed on 27 July 2010. He therefore lodged his application on 5 August 2010. Piccola wrote to Mr Simonini on 27 August 2010 terminating his employment for alleged abandonment. The issue of how the employment of Mr Simonini came to an end, and on what date, was at large before me for determination. I found that Mr Simonini’s employment was terminated on the initiative of Piccola and that the termination took place as a result of the letter of termination sent by Piccola on 27 August 2010.
[5] Because of Mr Simonini’s perception that he had been constructively dismissed on 27 July 2010 the application was filed before the date on which I subsequently found that the termination took place.
[6] Fair Work Australia has the power, pursuant to s586 of the Fair Work Act 2009 (the Act), to amend an application such as this, to continue to hear the application, to make appropriate findings and to determine the issues in dispute. It was on this basis that I proceeded to hear the application.
“586 Correcting and amending applications and documents etc.
FWA may:
(a) allow a correction or amendment of any application, or other document relating to a matter before FWA, on any terms that it considers appropriate; or
(b) waive an irregularity in the form or manner in which an application is made to FWA.”
[7] Mr Andrews submitted that once I had determined that the date of termination of Mr Simonini’s employment was 27 August 2010 I was obliged to dismiss his application. Acceptance of this submission would mean that an applicant who feared that he had been constructively dismissed would have to lodge an application and participate in a hearing to determine the date of termination of his employment; discontinue his then application upon a finding being made that his employment had been terminated by his employer on a later date or have that application dismissed; file a new application; apply for an extension of time and then, if the extension of time for the lodgement of that second application was granted, have the second application heard. It is to avoid that kind of wasteful proceedings that Fair Work Australia’s power to amend is directed.
[8] In giving consideration to this application I first had to determine whether or not Mr Simonini had been constructively dismissed, had abandoned his employment or had been dismissed on the initiative of Piccola. I was required by the Fair Work Act 2009 (the Act) to consider Sections 385 and 386 of the Act.
[9] Piccola wrote to Mr Simonini and informed him that his employment was terminated for abandonment. I found that there was no abandonment. Mr Simonini was prevented from entering his workshop at the direction of Mr Masi, the principal of Piccola. This direction was implemented by Mr Brancalion. Both Mr Masi and Mr Brancalion acknowledged that that was the case. Mr Simonini attended work on 26 and 27 July 2010. He was on sick leave after 27 July 2010. Mr Masi and Mr Brancalion knew that Mr Simmonini was unwell. Despite this, Mr Masi made no enquiry regarding the reason for Mr Simonini’s continued absence, any possible date of return, or why Mr Simonini might file an application for unfair dismissal.
“Had you had any disagreements with Mr Simonini up to the beginning of July, any disagreements about his work performance?---Sorry, from when?
Up until the beginning of July 2010, had you had any disagreements with him about his work performance?---No.
Why did you decide to change the arrangements regarding Mr Simonini's access to the workshop?---His behaviour became very erratic, where he'd just come and leave, without telling you where he was going, or any staff members.
How is that relevant to the workshop work? That is a matter you would think would be relevant to his performance at large generally, but why would that distinguish the workshop work from any other work?---Well, I - if he's coming and going, I'm not sure what he's actually doing in the workshop, so he can't report to me what stage is he up to in certain programs.
Did you speak to Mr Simonini before you made that decision?---No, but I met with him, and we went for dinner, pizza, because I wanted to sit down to discuss with him why his erratic behaviour was.
------
So the situation is, so far as you know, that Mr Brancalion was still working for you after 19 July, you heard that he was on sick leave - - -?---I got a medical certificate sent to me, yes.
- - - and then out of the blue you got an application for - an application related to an unlawful termination, or an unfair dismissal?---That is correct.
Did you call Mr Simonini at that stage to ask what was happening?---No.
Is there any reason why you didn't do that?---The reason is after the engine pitulation (sic) and he left, I was probably in shock and I just waited to calm down and hopefully thinking he would come back and see me and ask me why.
Is there anything arising out of my questions, Mr Andrews?
MR ANDREWS: No, Deputy President.” 2
[10] As I had found that Mr Simonini’s employment was terminated on the initiative of Piccola I was then required to apply the following provisions of the Act:
“Section 387
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWA 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 FWA considers relevant.”
[11] For the purpose of considering remedy, if appropriate, the following provisions apply:
Section 390
“(1) Subject to subsection (3), FWA may order a person’s reinstatement, or the payment of compensation to a person, if:
(a) FWA 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) FWA may make the order only if the person has made an application under section 394.
(3) FWA must not order the payment of compensation to the person unless:
(a) FWA is satisfied that reinstatement of the person is inappropriate; and
(b) FWA 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.
391 Remedy—reinstatement etc.
Section 391
Reinstatement
(1) An order for a person’s reinstatement must be an order that the person’s employer at the time of the dismissal reinstate the person by:
(a) reappointing the person to the position in which the person was employed immediately before the dismissal; or
(b) appointing the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.
(1A) If:
(a) the position in which the person was employed immediately before the dismissal is no longer a position with the person’s employer at the time of the dismissal; and
(b) that position, or an equivalent position, is a position with an associated entity of the employer;
the order under subsection (1) may be an order to the associated entity to:
(c) appoint the person to the position in which the person was employed immediately before the dismissal; or
(d) appoint the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.
Order to maintain continuity
(2) If FWA makes an order under subsection (1) and considers it appropriate to do so, FWA may also make any order that FWA considers appropriate to maintain the following:
(a) the continuity of the person’s employment;
(b) the period of the person’s continuous service with the employer, or (if subsection (1A) applies) the associated entity.
Order to restore lost pay
(3) If FWA makes an order under subsection (1) and considers it appropriate to do so, FWA may also make any order that FWA considers appropriate to cause the employer to pay to the person an amount for the remuneration lost, or likely to have been lost, by the person because of the dismissal.
(4) In determining an amount for the purposes of an order under subsection (3), FWA must take into account:
(a) 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 reinstatement; and
(b) the amount of any remuneration reasonably likely to be so earned by the person during the period between the making of the order for reinstatement and the actual reinstatement.
Section 392
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), FWA 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 FWA considers relevant.”
[12] In regard to s387(a) I determined that there was no valid reason for the termination of Mr Simonini’s employment. Mr Masi decided to prevent Mr Simonini from performing his work in the workshop. The stated ground for this exclusion was Mr Simonini’s lack of qualifications. I did not accept this. Mr Simonini had been working for Piccola for ten years with the same qualifications. This was a sudden decision of Mr Masi’s. He did not share his reasons for this decision with Mr Simonini. This conduct of Mr Masi’s was part and parcel of the deteriorating regard Mr Masi had for Mr Simonini.
[13] In regard to s387(b) and (c) I found that Mr Simonini was not notified of the alleged reason for the termination of his employment. He was not given an opportunity to respond to Piccola’s alleged perception that he had abandoned his employment or to the real reason for the termination of his employment, which I found was his deteriorating relationship with Mr Simonini. Piccola was aware of Mr Simonini’s illness and the fact that he had been excluded from the workshop. I found that Piccola’s reliance on abandonment was disingenuous and convenient. Mr Masi terminated the employment of Mr Simonini because of his perception of their poor personal relationship.
[14] Section 387(d) is irrelevant.
[15] I had regard to s387(e). Mr Simonini did not receive any warning before his dismissal.
[16] In relation to s387(f) and (g) it is clear that Piccola is a small enterprise. There was not likely to be any procedures to be followed in effecting a dismissal in this enterprise. There was not likely to be any dedicated Human Resources Management specialist or expertise in this enterprise. I had regard to this.
[17] In relation to s387(h) I had regard to the length of time Mr Simonini worked at Piccola, the circumstances surrounding his last few months of employment at Piccola and the fact that Mr Simonini was under the treatment of his general practitioner for high blood pressure at the time of his termination of employment. I had regard to the process by which Mr Simonini’s employment was terminated.
[18] In determining whether a particular termination is harsh, unjust or unreasonable consideration can be given to whether the penalty of termination is excessive or inappropriate. See Byrne v. Australian Airlines Ltd (1995) 185 CLR 410 at 465 per McHugh and Gummow JJ.
“It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.”
And
“Procedures adopted in carrying out the termination might properly be taken into account in determining whether the termination thus produced was harsh, unjust or unreasonable”. 3
[19] I found that the termination of Mr Simonini’s employment was harsh, unjust or unreasonable. It was unjust because Mr Simonini did not abandon his employment. It was harsh and unreasonable for the same reason. There was no other valid reason for the termination of Mr Simonini’s employment.
[20] Having determined that Mr Simonini’s termination of employment was harsh, unjust or unreasonable I had to give consideration to what remedy should apply to Mr Simonini.
[21] I considered the remedy of reinstatement. I concluded that it was not appropriate in all the circumstances of this case. I considered the remedy of compensation in lieu of reinstatement. I concluded that it was an appropriate remedy in all the circumstances of this case.
[22] I considered a number of circumstances in determining to award Mr Simonini twelve weeks compensation.
[23] The twelve weeks compensation does not include any amount which might have been due in relation to other entitlements including notice, annual leave, long service leave or unpaid superannuation.
[24] I took into account the effect of my order on the viability of Piccola’s enterprise. I accepted that it would have some adverse effect on the enterprise and I took that into account in making my order for twelve weeks compensation and also in my order, which will issue concurrently with this decision, that the compensation be paid by installments.
[25] I took into account the fact that Mr Simonini had had a long period of employment.
[26] I took into account the remuneration that Mr Simonini would have earnt if he had not been dismissed.
[27] I took into account Mr Simonini’s efforts to mitigate his loss. He has commenced a new business in his area of expertise. He was previously in partnership with Mr Masi in a business which was separate from his employment. I considered that Mr Simonini had made a considerable effort to mitigate his loss. I have also taken into account the amount of income that Mr Simonini is likely to have earnt between the making of this order and the payment of compensation.
[28] I took into account Mr Simonini’s ill health since the deterioration of his and Mr Masi’s relationship became apparent.
[29] It was for these reasons that I delivered my decision in transcript on 5 November 2010 and the orders which I will deliver concurrently with this decision.
SENIOR DEPUTY PRESIDENT
1 Transcript PN1610 - PN1616
2 Transcript PN1213 - PN1225
3 (1995) 185 CLR 410 at 465 per McHugh and Gummow JJ.
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