Mr John Cornwall v Electus Distribution Pty Ltd T/A Jaycar Electronics

[2015] FWC 1266

[2015] FWC 1266 [Note: An appeal pursuant to s.604 (C2015/2147) was lodged against this decision - refer to Full Bench decision dated 17 April 2015 [[2015] FWCFB 2568] for result of appeal.]

FAIR WORK COMMISSION

DECISION

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

Mr John Cornwall
v
Electus Distribution Pty Ltd T/A Jaycar Electronics
(U2014/6143)

COMMISSIONER CLOGHAN PERTH, 12 MARCH 2015

Application for relief from unfair dismissal.

[1] Mr John Cornwall (Mr Cornwall or Applicant) has made application to the Fair Work Commission (Commission) seeking a remedy for alleged unfair dismissal from his employment with Electus Distributions Pty Ltd T/A Jaycar Electronics (Employer or Jaycar).

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

[3] On 15 April 2014, the parties were advised that the application was listed for telephone conciliation before a Conciliator on 21 May 2014.

[4] On 22 April 2014, Mr Cornwall sought for the matter to be dealt with by a “face to face” meeting and not by telephone. Mr Cornwall was advised that this request had been refused by the Unfair Dismissal Team but it would reconsider the matter, if he provided in writing an outline of exceptional circumstances. Subsequently, the Applicant, on 30 April 2014, advised the Commission that he wanted the application referred directly to arbitration. The Conciliator’s conference was cancelled and the matter referred to me for arbitration.

[5] On 13 May 2014, I issued Directions for a hearing on 5 August 2014.

[6] On 5 August 2014, the Employer’s representatives attended the Commission. The Applicant did not attend. Ultimately, the Applicant was contacted by telephone but the hearing was unable to proceed.

[7] On 5 August 2014, my Associate confirmed with the Applicant the need for him to comply with the Directions issued on 13 May 2014 which were set out on transcript at the hearing on 5 August 2014.

[8] On 15 August 2014, the Applicant provided a “submission”.

[9] On 28 August 2014, the Employer sought for the application to be dismissed pursuant to s.399A of the FW Act, as the Applicant, on two (2) occasions, unreasonably failed to comply with Directions issued by the Commission. While I was not entirely comfortable with the purported compliance with the Directions, I requested the Employer to comply with its requirements pursuant to the Directions.

[10] At the hearing, Mr Cornwall represented himself and gave evidence on his own behalf.

[11] The Employer was represented by Ms Mackie, Director, People Assets. Ms Mackie gave evidence on behalf of the Employer.

[12] This is my decision and reasons for decision on Mr Cornwall’s application.

RELEVANT LEGISLATIVE FRAMEWORK

[13] There is no dispute between the parties that Mr Cornwall has properly made the application in accordance with s.382 of the FW Act. Accordingly, the relevant statutory framework is ss.385 and 387 of the FW Act.

[14] 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) ...”

[15] 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.”

RELEVANT BACKGROUND

[16] In November 2008, the Applicant commenced employment as the Manager of the Jaycar store in Rockingham, Western Australia. Mr Cornwall had re-entered the workforce after retiring from running his own business.

[17] Mr Cornwall claims that he was “being bullied and became so depressed that he sought professional help between 3 August and 11 December 2009”. 1

[18] On 1 April 2010, Mr Cornwall was counselled by the Area Manager and given a First Formal Warning.

[19] On return from annual leave, in January 2011, the Applicant asserts he was “stressed” regarding certain activities which occurred while he was on leave.

[20] In May 2011, the Employer appointed an Assistant Store Manager to the Rockingham store.

[21] On 19 January 2012, the Applicant received correspondence from the Employer which relevantly reads:

“In follow up to our discussion regarding your position and current concerns at the Rockingham store and the agreement that you would like to change your role from Store Manager to Assistant Manager effective 1st March 2012”. (my emphasis).

[22] Mr Cornwall signed the document reflecting the above change in circumstances.

[23] In the hearing, Mr Cornwall states that he was “demoted” 2 in March 2012.

[24] Mr Cornwall’s salary and conditions of employment remained unchanged as a result of taking up the role of Assistant Manager.

[25] Between 19 March 2012 and October 2013, It appears the Employer appointed four (4) managers to the Rockingham store, the last being Mr Cassey.

[26] Mr Cornwall provides a disparaging assessment of Mr Cassey 3.

[27] On 28 October 2013, Mr Waite was appointed Store Manager.

[28] In January 2014, Mr Cornwall took four (4) weeks annual leave.

[29] Mr Waite took annual leave almost immediately Mr Cornwall returned from his annual leave.

[30] Mr Cornwall asserts that on Mr Waite’s return from annual leave, he sought a meeting with him “to discuss problems I’d had with staff in his absence” 4.

[31] On 11 March 2014, Mr Cornwall was asked to attend a disciplinary meeting with Mr Sapia, Area Manager and Ms Mackie. Mr Cornwall was advised that a witness/support person could attend the meeting. Mr Cornwall’s wife attended.

[32] At the conclusion of the meeting, Mr Cornwall was advised that his employment would cease immediately.

[33] On 12 March 2014, Mr Cornwall received his letter of termination of employment which relevantly reads:

“As discussed in the meeting held with myself Nicky Mackie (Human Resources), Matt Sapio (Area Manager) and Ida Cornwall (witness) on 11 March 2013 (sic) the company continues to have serious concerns with your performance.

Since your last discussion held with your Store Manager and Area Manager in December 2013, there has been a continuation of the concern regarding your level of performance.

The unacceptable nature of your performance has been discussed with you by your Area Manager on multiple previous occasions over the last 12 months.

• Feb 2013 - Warning Issued regarding under performance



• June 2013 - Personal development plan



• August 2013 - Personal development Plan reviewed and explained again



• October 2013 - Warning issued regarding under performance



• November 2013 - Clarity of Expectations and agreement on key role responsibilities



• December 2013 - Performance Counselling with Store Manager and Area Manager



• Feb 2014 - continuation of your level of underperformance and hence todays discussion

Therefore, as a result of your ongoing performance standards continuing to be below the company standards, it is with regret that we have no alternative than to terminate your employment effective 11 March 2014.” 5

CONSIDERATION

[34] Section 387 of the FW Act sets out the matters which the Commission must take into account in determining whether a dismissal was “harsh, unjust or unreasonable”. In seriatim, they are as follows.

s.387 (a) - was there a valid reason for the Applicant’s dismissal related to capacity or conduct?

[35] A valid reason for dismissal is one that is “sound, defensible or well founded and not capricious, fanciful or spiteful”. The authority for this approach is found in the often cited case of Selvachandran v Peterson Plastics Pty Ltd (1995) 62 IR 371 at page 373 which reads as follows:

“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’.”

[36] A valid reason for dismissal attempts to balance, in a practical way, the needs of employees and employers.

[37] Mr Cornwall was dismissed as a consequence of his performance which had been discussed with him, on multiple occasions, in the 12 months preceding his dismissal.

[38] The Employer does not assert that Mr Cornwall was dismissed as a consequence of specific conduct. However, in relation to his capacity, it cannot go unnoticed that from 1 March 2012, his role changed from Store Manager to Assistant Manager.

[39] The documentary evidence demonstrates that the change in role arose out of the Employer’s concerns at the Rockingham store. Importantly, Mr Cornwall agreed to his role being changed to Assistant Manager 6.

s.387(b) - notification of the reasons for termination of employment

[40] I find that Mr Cornwall was notified of the reason for his dismissal at the meeting on 11 March 2014, and in correspondence from the Employer on 12 March 2014 7.

s.387(c) - opportunity to respond

[41] In view of the fact that Mr Cornwall was not dismissed as a consequence of specific conduct, this criterion is not relevant. Further, in relation to capacity, Mr Cornwall’s response is considered under the criterion in s.387(d) of the FW Act below.

s.387(d) - support person

[42] The Employer did not refuse or unreasonably refuse to allow Mr Cornwall to have a support person present. Mrs Cornwall was present during the discussion relating to his dismissal on 11 March 2014.

s.387(e) - unsatisfactory performance

[43] Reduced to its simplest, this criterion requires the Commission to determine whether Mr Cornwall was “warned” about his unsatisfactory performance prior to the dismissal.

[44] Putting aside, for historical reasons, the “First Formal Warning” dated 1 April 2010, the next relevant warning is dated 19 September 2013 and headed “Second Formal Warning”.

[45] The “Second Formal Warning” opens with a reference to a “counselling interview” and states, “there, are a number of issues that require immediate attention in regards to your performance”. The correspondence sets out six (6) main areas of concerns, some of which have multiple areas within. The correspondence informs Mr Cornwall that “it is essential that some immediate improvement in your overall performance be evidenced in these areas...Failure to address the above outstanding issues...will result in further disciplinary action being taken...” Mr Cornwall accepted the terms set out in the correspondence and acknowledged that he had the opportunity to ask questions and seek clarification. In conclusion, Mr Cornwall agreed to improve his performance to an acceptable level and that his performance would be reviewed on an ongoing basis 8.

[46] On or around 18 June 2013, the Employer provided Mr Cornwall with a Performance Development Plan (PDP). The PDP set out Projected Improvement Outcome and an Action Plan 9. In August 2013, the Employer reviewed and explained to Mr Cornwall its expectations against the PDP.

[47] On 19 September 2013, Mr Cornwall met with the Area State Manager and Ms Jeffrey-Lonnie, Human Resources Consultant, to discuss a number of issues regarding Mr Cornwall’s performance. This discussion was reduced to writing and is headed “First Formal Warning”. To avoid confusion with the other “First Formal Warning” issued in April 2010, I shall refer to the 19 September 2013 warning as “FFW”. I note that in the Employer’s submission, this correspondence is referred to as a “Final Written Warning”, which I strongly suspect was its intention.

[48] The FFW commences and repeats the Employer’s concerns regarding issues with Mr Cornwall’s performance that required immediate attention. On this occasion, the FFW sets out nine (9) concerns at the Rockingham Store and five (5) key requirements of the Employer.

[49] Included in the FFW is the following statement by the Employer, “it was observed that your performance continues to be below expected Jaycar standards...” Further, “this letter constitutes a first formal warning requiring you to modify your actions and behaviours to reflect the requirements of the Jaycar policies and procedures. Failure to address the above outstanding issues over the coming 1 month may result in further disciplinary actions being taken”. 10 Mr Cornwall signed to say that he “read, understood and had the opportunity to seek clarification” with regards to the FFW.

[50] On 16 October 2013, Mr Cornwall met with Ms Jeffrey-Lonnie in a follow up to the FFW. While it is not necessary to detail the correspondence to Mr Cornwall which sets out a record of the discussion, it is notable that the first dot point specifies that Mr Cornwall had failed to supply data to the Area Manager because the Applicant “did not think this would show [the Area Manager] anything of value” 11. Notwithstanding Mr Cornwall’s view, to avoid a “stalemate” with the Area Manager, he agreed to provide the information.

[51] In December 2013, the Employer submits that Mr Cornwall met with the Area Manager and Store Manager, in what is described in the letter of termination of employment, as a performance counselling meeting 12.

[52] The Employer assessed that Mr Cornwall’s performance had not improved during February 2014. Accordingly, a meeting was held on 11 March 2014, which led to his dismissal.

[53] The notes of meeting on 11 March 2014, which were not contested by the Applicant, in my view, demonstrate Mr Cornwall’s lack of understanding of the Employer’s assessment of his performance.

[54] Ms Mackie stated that the Employer had given Mr Cornwall multiple warnings regarding his performance; Mr Cornwall’s response was to say “really, when?”

[55] Ms Mackie proceeded to set out the processes carried out by the Employer to which Mr Cornwall responded “management prior to Andrew [Mr Waite] was a “nutter”.

[56] Mr Cornwall responded to performance issues by: claims of conspiracy by another employee to take his job; “rubbish”, “staff are not listening” to his directives, and staff “limiting” his ability to do his job.

[57] When it was put to Mr Cornwall that he had not been “able to do the job since June”, and that the Employer had demonstrated this and guided him with “multiple examples from Matt, Wendy and others”, Mr Cornwall’s response was to say that he was “assaulted by that women (sic) [Ms Jeffrey-Lonnie]. On another occasion, another employee, Mr Browne “ had done a number of me”.

[58] I find that the Employer assessed Mr Cornwall’s performance shortcomings sufficient to warrant formal action. In the 12 months leading up to Mr Cornwall’s dismissal, this was the subject to two formal warnings and a final written warning. I find that Mr Cornwall was sufficiently advised of his shortcomings and the Employer worked with him to improve the situation. I am satisfied that the Applicant understood what was required, his performance was subject to review and that if his performance did not improve, it would lead to further disciplinary action.

[59] In short, I find the Employer’s procedure fair and transparent.

[60] Mr Cornwall submits a number of issues. Clearly, with few exceptions, Mr Cornwall had a low assessment of managers with whom he had to work. Mr Cornwall’s last Manager, Mr Waite “appeared to be capable”, however he also, ultimately, is the subject of criticism.

[61] The Applicant’s case was essentially a response by the Employer’s submission. This exchange is revealing of Mr Cornwall’s workplace interaction. Where the Employer sets out that Mr Cornwall displays a lack of professionalism - the Applicant finds the Employer’s actions unprofessional and distasteful. All his actions can be laid at the feet of the Employer 13.

[62] Mr Cornwall refers in his response to the Employer’s “putdown expertise” and proceeds to reciprocate or respond in such ways as, “you have a convenient memory”, “you think”, “rubbish...” and “then you are blind, deaf and stupid”. Clearly, these proceedings became a continuation of the workplace interaction which existed prior to Mr Cornwall’s dismissal.

[63] During Mr Cornwall’s period of employment, he submitted that he suffered from adverse mental health outcomes, staff difficulties and general workplace pressures including the inability to take annual leave and excess hours. The Employer was aware of some of these matters.

[64] The totality of the evidence is that the Employer set out the performance issues it had with Mr Cornwall and what it, as an employer, expected. The Employer did not move swiftly from poor performance to termination of employment. The Employer worked with Mr Cornwall from the Second Formal Warning on 8 February 2013 to the FFW on 19 September 2013, and finally, to his dismissal on 12 March 2014. It appears to me that the Employer endeavoured to keep the employment relationship “alive” during a relative long period of over 12 months, and was not “trigger happy”, in choosing to dismiss Mr Cornwall for performance reasons.

[65] The Employer also made its intentions clear if Mr Cornwall did not meet performance expectations, there would be further disciplinary action. After 12 months and opportunities for Mr Cornwall to improve his performance, the Employer came to the conclusion that the issuance of ongoing performance warnings was not a solution and terminated his employment.

[66] Having considered the totality of the criteria in s.387 of the FW Act, the evidence and submissions, Mr Cornwall’s performance was of such a nature, and extent, that the Employer had a sound and defensible reason to terminate his employment.

s.387(f) - size of enterprise

s.387(g) - Human Resources

[67] I am satisfied that the Employer’s human resource response to Mr Cornwall’s performance befitted an organisation of its size. As I have already stated, it was fair and transparent.

s.387(h) - other matters

[68] I am satisfied that there are no other material matters involved in this application which have not been considered above, and require my consideration.

CONCLUSION

[69] In conclusion, for the reasons set out above, I am satisfied that Mr Cornwall’s dismissal from his employment was not unfair pursuant to s.387 of the FW Act. Accordingly, the application must be dismissed. An Order to this effect is issued jointly with this Decision.

COMMISSIONER

Appearances:

J Cornwall, the Applicant.

N Mackie, on behalf of the Employer.

Hearing details:

2015:

Perth,

12 February.

 1   Exhibit A1

 2   Exhibit A1

 3   Exhibit A1

 4   Exhibit A1

 5   Exhibit R3

 6   Exhibit R3(5)

 7   Exhibit A3(13) and (14)

 8   Exhibit R3(11)

 9   Exhibit R3(10)

 10   Exhibit R3(7)

 11   Exhibit R3(7)

 12   Exhibit R3(14)

 13   Exhibit A1

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