Mr John Sutton v Solar and Batteries Direct Pty Ltd

[2019] FWC 5295

[2019] FWC 5295

FAIR WORK COMMISSION

DECISION

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

Mr John Sutton
v
Solar and Batteries Direct Pty Ltd
(U2018/10246)

COMMISSIONER HUNT BRISBANE, 6 AUGUST 2019

Application for an unfair dismissal remedy – dismissal of apprentice employee unjust and unreasonable – compensation ordered.

[1] On 4 October 2018, Mr John Sutton made an application pursuant to s.394 of the Fair Work Act 2009 (the Act) alleging that his dismissal from Solar and Batteries Direct Pty Ltd (Solar) was harsh, unjust or unreasonable.

[2] On 10 April 2019 I issued a decision ([2019] FWC 1560) dismissing Solar’s jurisdictional objection that Mr Sutton had not met the minimum employment period.

[3] On 13 May 2019 I issued a decision ([2019] FWC 2924) dismissing Solar’s jurisdictional objection that there had not been a dismissal. I found that Mr Sutton had been dismissed on the respondent’s initiative.

Small Business Fair Dismissal Code

[4] Solar employed four employees at the time of the dismissal, and accordingly it is necessary for the Fair Work Commission (Commission) to determine if Mr Sutton’s dismissal was in accordance with the Small Business Fair Dismissal Code (the Code) pursuant to s.388 of the Fair Work Act 2009 (the Act). A dismissal will not be unfair if the employer is a small business and the dismissal was consistent with the Code. The Code provides:

“Small Business Fair Dismissal Code

Commencement

The Small Business Fair Dismissal Code comes into operation on 1 July 2009.

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. [original emphasis]”

[5] If the Commission determines that the dismissal was not in accordance with the Code, it is necessary for the Commission to then consider if the dismissal was harsh, unjust or unreasonable, taking in account the criteria set out at section 387 of the Act:

“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.”

Determinative Conference

[6] The matter was listed for hearing before me on 3 July 2019. Mr Sutton appeared on his own behalf, with his father, Mr Shawn Sutton’s assistance. Mr Iain Parke, Director appeared for the respondent. After obtaining the views of the parties, I decided to hold the matter as a determinative conference.

Evidence and submissions of both parties

[7] During the determinative conference I informed Mr Parke that given he had earlier led evidence before the Commission that there had not been a dismissal at the initiative of the respondent, it is then difficult to submit that given the dismissal was a summary dismissal, the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Mr Parke stated that he understood, and he did not wish to make any submissions as to whether the Code had been met relevant to summary dismissal.

[8] On the consideration of ‘other dismissal’, Mr Parke stated that he did not wish to make a submission.

s.387(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)

[9] Relevant to the considerations at s.387 of the Act, Mr Parke stated that he considered Mr Sutton’s non-attendance at work for two days to constitute a valid reason for the dismissal. He said, “I think if you don’t turn up for work then you’ve got no right to have the apprenticeship.” 1 Mr Sutton had previously not attended for work in January 2018, and Mr Parke had convinced him to return to work.

[10] Mr Sutton stated that on the return from the Christmas break in early 2018, he and another apprentice had been kept up all night with an alarm, and they both messaged their supervisor advising that they wouldn’t be able to make it into work as they hadn’t slept. Mr Sutton was contacted and encouraged to come back to work, which he did, and received a $3 per hour increase to his wage. Two weeks later his apprenticeship was signed.

[11] Mr Parke agreed that the January 2018 incident involved Mr Sutton attending for work only a few hours late. He then stated that Mr Sutton was always late throughout his employment. He said that he had been informed of that fact by Mr Kyle Reid, supervisor, and he had not observed it himself as Mr Sutton would ordinarily commence at 5:00am at the yard, and Mr Parke did not attend for work until 8:00am at the office. Mr Parke said that he was aware that Mr Sutton had been verbally warned about his tardiness by Mr Reid.

[12] Mr Sutton stated that he could not recall being late for work, and if he was late, it would only have been around five minutes on any occasion.

[13] Mr Sutton stated that he had attended block training at TAFE, but it had finished early, and accordingly he contacted another apprentice and advised the training had finished early. In answering a question from me he acknowledged that he should have contacted his supervisor to inform him that the training had finished early.

[14] Mr Parke’s evidence is that Mr Sutton should have contacted his supervisor, as Mr Parke was paying for Mr Sutton to attend TAFE, and if Mr Sutton was sitting around home, Mr Parke could have found him work to do. Mr Parke only learned of this issue at the last hearing before the Commission.

[15] It is helpful to recount earlier evidence from my decision [2019] FWC 2924:

“[15] Mr Sutton’s evidence is that it was customary to receive notification by a text message on Sunday evenings about his work for the following week. On Sunday, 16 September 2018 Mr Sutton had not received any contact from his employer and so he assumed there was no work for the coming week. His ordinary commencement time was 5.00am.

[16] At approximately 5:10am on Monday, 17 September 2018 Mr Sutton received a text message from one of his work colleagues, Mike, the electrician, which read:

“John you coming in today? Have a think about it, if you are not in today there is a good chance you won’t have a job tomorrow. One missed paycheck isn’t worth throwing an apprenticeship away.”

[17] Mr Sutton’s evidence is that he didn’t read the text message at 5:10am, as he was asleep. He didn’t take Mike’s call at 5.37am because again, he was asleep. In answering questions from me as to what he did on that day once he awoke, he stated that he could not remember. He agreed that he did not try and contact his employer. He agreed that Mike’s message was informing Mr Sutton that he should come in to work.

[18] On 18 September 2018 the following text messages were exchanged: 

Mr Parke:	I take it by not showing up for work and ignoring everyone’s calls is your way of letting us know you have finished
Mr Sutton:	I was told not to come in last week and then I didn’t receive anything about working on Monday until the morning. I haven’t been getting paid properly while being at TAFE and I haven’t even been paid from 2 weeks ago and I didn’t receive a reply after asking about that either.
Mr Parke:	Let’s just call it a day then if that’s your attitude

………………

[49] Mr Reid stated that between approximately 5:00am and 7:00am on 17 September 2018 he attempted to call Mr Sutton’s phone at least five times and texted him at least once. Mr Reid stated that he asked another staff member to try to get in touch with Mr Sutton as well, but he did not give evidence of who that staff member was or how they attempted to contact Mr Sutton.

[50] Mr Reid confirmed that at 5:17am on 17 September 2018 he sent the following text message to Mr Sutton: 

“Make sure you know what you’re doing. Don’t throw your job away over nothing”.

[51] Mr Reid stated that he had expected Mr Sutton to arrive for work at 5:00am on 17 September 2018 at the Respondent’s work yard. He stated that it had been the ordinary practice for employees to present for work at the Respondent’s work yard and ‘90% of the time’ employees required to present at 5:00am. Mr Reid stated that Mr Sutton would have known he was supposed to be at the work yard at 5:00am regardless of whether or not he received a text on Sunday night describing his work requirements for the next week.

[52] Mr Reid stated that he was informed that on 18 September 2018 Mr Parke and other staff members of the Respondent continued trying to contact Mr Sutton regarding his attendance for work. Mr Reid confirmed that he did not attempt to contact Mr Sutton at any time after 17 September 2018.

[53] In cross-examination, Mr Shawn Sutton asked Mr Reid to confirm the phone number that he had attempted to contact Mr Sutton on, as Mr Sutton’s phone number had changed shortly before 17 September 2018, and Mr Sutton had no record of receiving Mr Reid’s text message or phone calls. Mr Reid confirmed that his text and attempted phone calls had been directed to Mr Sutton’s correct phone number [notations omitted].”

[16] Relevant to Mr Reid’s evidence of attempting to communicate with Mr Sutton on 17 September 2018, I made the following finding:

“[60] I have considered the evidence of all parties regarding the attempts to contact Mr Sutton on 17 – 18 September 2018. I consider that the evidence before me is not necessarily contradictory. I accept Mr Reid’s evidence that he attempted to contact Mr Sutton several times on the morning of 17 September 2018. I prefer Mr Reid’s evidence over Mr Sutton’s.

[61] It is uncontested that Mr Sutton received a text message and missed a phone call from Mike shortly after 5:00am on 17 September 2018, although I accept Mr Sutton’s evidence that he missed that correspondence as he was asleep. Mr Sutton made no effort to contact anybody from the Respondent upon waking, and provided no satisfactory explanation for the failure to do so.”

[17] On the consideration of valid reason, the parties stated that they did not wish to make any further submissions.

s.387(b) - Whether the person was notified of that reason

[18] Mr Parke submitted that because the Commission had found there had been a dismissal on account of his text message, the Commission could be satisfied that Mr Sutton had been notified. Mr Sutton agreed.

s.387(c) - Whether there was an opportunity to respond to any reason related to the capacity or conduct of the person

[19] Mr Sutton submitted that he was not given an opportunity to respond, and given there was no valid reason for the dismissal, he had no opportunity to respond. Mr Parke replied that he did consider that there was a valid reason for the dismissal, and Mr Sutton could have responded by text saying, “Let’s talk about it.”

[20] Mr Sutton stated that he had already been dismissed by this stage, and he was not going to argue about it.

s.387(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

[21] The dismissal was by telephone. Neither party wished to make submissions on this consideration.

s.387(e) - Was there a warning of unsatisfactory work performance before dismissal

[22] Mr Parke stated that Mr Sutton had been warned verbally by Mr Reid. Mr Sutton stated that relevant to Mike’s text message, he didn’t consider Mike to be his supervisor.

s.387(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

s.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

[23] Mr Parke stated that as a small business, there is not a lot of human resources experience within the business, and unsurprisingly, there is no human resources department. Mr Sutton did not make any submissions on this consideration.

s.387(h) - any other matters that FWC considers relevant

[24] Mr Sutton stated that he was 19 years old at the time of the dismissal, and I should have regard to him being a young person when I take into consideration he had not called work to advise of his non-attendance.

[25] Mr Parke stated that the Commission should take into account that Mr Sutton was being paid for the days that he attended TAFE, and Mr Parke took exception to learning that Mr Sutton had finished TAFE at approximately 1:00pm, but not made contact with the respondent. Mr Shawn Sutton insisted that there had indeed been a problem with his son being paid for his TAFE attendance.

Consideration

Was Mr Sutton’s dismissal consistent with the Small Business Fair Dismissal Code?

[26] A dismissal will not be an unfair dismissal if the employer is a small business and the dismissal was consistent with the Code. It is not in dispute that Solar is a small business employer within the meaning of s. 23 of the Act.

[27] Mr Sutton was an apprentice employee, and I have found that Mr Parke dismissed him. No submissions were made that the dismissal was for performance reasons invoking ‘Other dismissal’ in accordance with the Code. No payment in lieu of notice was made to Mr Sutton, and accordingly, I am satisfied that Mr Sutton was summarily dismissed.

[28] As for the reasons pursuant to the Code, it is extraordinarily difficult for an employer to satisfy the Commission that the Code has been met relevant to a summary dismissal if the employer asserts that there was no dismissal by the employer. This is so because the Code requires the employer to assert and demonstrate that they had a reasonable belief that the person had engaged in serious misconduct.

[29] While I consider that Mr Parke was annoyed and frustrated by Mr Sutton’s failure to communicate his non-attendance at work on 17 and 18 September 2018, I do not consider that he believed on reasonable grounds that Mr Sutton’s conduct was sufficiently serious to justify immediate dismissal. This is particularly the case where Mr Sutton was an indentured apprentice, and obligations arise between parties to an apprenticeship over and above obligations in a traditional employment relationship. I accept Mr Parke’s evidence that he did not know that he could call upon those who assisted the parties enter into the apprenticeship for assistance with the troubled relationship. However, he ought to have known, given his evidence of having employed apprentices in the past, that contractually, there is an obligation not to unilaterally terminate the relationship.

[30] The following information on employer responsibilities is detailed on the Department of Employment, Small Business and Training (Queensland) webpage. References to ASSN mean an Australian Apprenticeship Support Network provider:

“Events where the employer must notify their AASN provider or the department

The employer must notify their AASN provider or the department in writing within 14 days of any of the following events:

•  Agreement by the parties to amend or cancel the training plan.

•  Deciding that the apprentice or trainee is unlikely to meet the requirements of their training plan.

•  If the apprenticeship or traineeship will not be completed within the nominal term and an extension is required.

•  Sale or disposal of the business by the employer.

•  Dissolution or change of business partnership.

•  Where the purchaser of a business agrees to continue to train an apprentice or trainee, the employer must give notice to the AASN provider or the department of the agreement. On receipt of this notification, the training contract is taken to be assigned to the purchaser of the business (the new employer). Note that if a purchaser/new owner or new partnership does not wish to retain an apprentice or trainee, they must notify the AASN provider or the department in writing before the change takes effect.

•  Temporary transfer of a training contract (within seven days after the day the transfer takes effect).

•  Suspension of a training contract - suspension effect date cannot be less than seven days from the date the advice was given to their AASN provider or the department.

However, if the training contract ends during the probationary period, the employer must notify their AASN provider or the department within seven days of the apprenticeship or traineeship ending.

School-based apprentices and some school-based trainees will not complete their apprenticeship or traineeship while at school. Employers are required to convert the training contract to full-time or part-time when the apprentice or trainees completes their final day at school.

This is an automatic process carried out by the department. However, if the student leaves school before the end of Year 12, the parties will need to convert the training contract using ATF-035 Amendment of a registered training contract form. Once converted, appropriate award wages and conditions apply.

The employer must not directly or indirectly:

•  Obstruct or discourage in any way, the apprentice or trainee from participating in the training required under the training plan to be delivered by the training organisation.

•  Place the apprentice or trainee at a disadvantage, because they participate or attempt to participate in the required training.

It is very important that parties maintain open lines of communication and attempt to resolve disputes between themselves in the first instance. If these attempts fail, disputes should be referred to the AASN provider or the department for further assistance and early intervention.

For further information

Contact:

•  the nominated AASN provider for the training organisation

•  Apprenticeships Info on 1800 210 210, regarding employer obligations under the training contract

•  Fair Work Ombudsman on 13 13 94, regarding employment concerns.”

[31] Further, the following advice is provided to the parties to an apprenticeship if troubles in the relationship become apparent:

“Information to get started

During the term of an apprenticeship or traineeship, an employer, apprentice or trainee may seek assistance or support from the Department of Employment, Small Business and Training, their Australian Apprenticeships Support Network (AASN) provider or, for more serious concerns, various other organisations.

Who can help?

Department of Employment, Small Business and Training

Some of the issues facing employers, apprentices and trainees that the department (or the AASN provider) can provide assistance with are:

•  communication problems

•  workplace mediation

•  negotiation and conflict resolution

•  emotional and mental health issues

•  personal issues

•  absenteeism and behavioural issues.

The department, in providing such assistance, may need to decide matters relating to the training contract or refer the employer, apprentice or trainee to other community-based and government specialist services.”

[32] If problems were arising with Mr Sutton’s conduct, especially his failure to notify an absence from work, even where he was being contacted by his supervisor and another adult worker, Mr Parke’s responsibilities were to seek assistance from the relevant government department, or the AASN provider who worked with the parties to create the apprenticeship.

[33] Accordingly, I find that Mr Parke did not believe on reasonable grounds that Mr Sutton’s conduct was sufficiently serious to justify immediate dismissal when firstly he denied that he had dismissed Mr Sutton, and secondly, he could have sought assistance with the employment difficulties.

[34] Solar cannot have complied with the Code with respect to ‘Summary Dismissal’ or ‘Other Dismissal’, and I determine that Solar did not comply with the Code.

Was Mr Sutton’s dismissal harsh, unjust or unreasonable?

[35] The Code not having been complied with, it is then necessary to determine whether the dismissal was harsh, unjust or unreasonable taking into account the criteria in s.387 of the Act.

s.387(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)

[36] I accept that Mr Sutton’s failure to attend for work on 17 and 18 September 2018 was without an adequate excuse. He was contacted by Mike, and then by Mr Reid, imploring him to attend for work and not to throw away his apprenticeship. He made no effort at all to contact Mr Parke, and awaited Mr Parke’s text of 18 September 2018.

[37] In light of there being only a two day absence, and having regard to what I have said above about the requirement to involve the department or the body who helped create the apprenticeship, I do not consider there to have been a valid reason for the dismissal. I do, however, agree that Mr Sutton’s conduct on 17 and 18 September 2018 constituted misconduct.

[38] I determine that there was not a valid reason for the dismissal.

s.387(b) - Whether the person was notified of that reason

[39] The parties agreed that given my earlier finding of dismissal, Mr Parke’s text message to Mr Sutton constituted notification of the reason for the dismissal. I agree.

s.387(c) - Whether there was an opportunity to respond to any reason related to the capacity or conduct of the person

[40] I do not accept that there was an opportunity to respond to Mr Parke’s reason for the dismissal relevant to Mr Sutton’s capacity or conduct. Mr Sutton’s responsive text to Mr Parke could not have foreshadowed dismissal by the very next text. He concluded that he had been dismissed on receipt of the second text, and telephoned his father to say that is what had occurred. Mr Parke’s submission that Mr Sutton should have made further inquiries is at odds with his earlier position that there had not been a dismissal.

s.387(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

[41] There was no discussion, simply dismissal by text message. Accordingly, I find that there was not an unreasonable refusal by Solar to allow a support person present.

s.387(e) - Was there a warning of unsatisfactory work performance before dismissal

[42] Mr Sutton was verbally warned by Mr Reid, some months prior to the dismissal, and I accept that he was warned by Mike and Mr Reid respectively on 17 and 18 September 2018 of his risk in not attending for work. Mr Sutton submitted that Mike was not his supervisor and therefore his warning should not carry appropriate weight. I disagree. Mike was an adult worker imploring Mr Sutton, a 19 year old apprentice to attend for work or risk throwing his apprenticeship away. I consider that Mr Sutton should have heeded the warning of Mike and Mr Reid, and considered Mike’s communication as more than just simply pastoral advice.

s.387(f) - Whether Solar’s size impacted on the procedures followed and s.387(g) - Whether the absence of a dedicated resource management specialist impacted on the procedures followed

[43] I accept that Solar is a small business without any dedicated resource management specialists, and I have taken that into consideration.

s.387(h) - Other matters

[44] I have taken into account Mr Sutton’s relatively young age and the fact that he was an indentured apprentice with expectations to continue his apprenticeship. Relevant to whether Mr Sutton was properly paid for all of his attendance at TAFE, it is not clear to the Commission whether all of those days have been paid or not, and it is noted that this was Mr Sutton’s concern to Mr Parke in his text message to him of 18 September 2018.

Conclusion

[45] Having taken the above into account, I conclude that the dismissal was unjust and unreasonable. Mr Sutton’s expectations as a young apprentice to continue in his apprenticeship were severed on receipt of Mr Parke’s text message of 18 September 2018. Far more should have been done by Mr Parke to get the apprenticeship and employment relationship back on track, and it was unjust and unreasonable to sever the employment relationship on the basis of Mr Sutton’s misconduct in not attending for work on 17 and 18 September 2018 and not communicating appropriately his non-attendance.

[46] Accordingly, I find that Mr Sutton was unfairly dismissed.

Remedy

[47] Section 390 of the Act reads as follows:

“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.”

[48] Mr Sutton is a person protected from unfair dismissal for the Act’s purposes, and is a person who has been unfairly dismissed. Accordingly, I am empowered to exercise discretion as to whether he can be reinstated.

[49] Mr Sutton does not seek reinstatement, and I am satisfied in all of the circumstances that reinstatement is inappropriate.

[50] I now turn to consideration of compensation.

Compensation

[51] Section 392 of the Act provides:

“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.

(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.”

Authorities

[52] The approach to the calculation of compensation is set out in a decision of a Full Bench of the Australian Industrial Relations Commission in Sprigg v Paul’s Licensed Festival Supermarket. 2 That approach, with some refinement, has subsequently been endorsed and adopted by Full Benches of the Commission in Bowden v Ottrey Homes Cobram and District Retirement Villages inc T/A Ottrey;3 Jetstar Airways Pty Ltd v Neeteson-Lemkes4 and McCulloch v Calvary Health Care (McCulloch).5

[53] I have had regard to the above authorities, and I have considered the submission of each party.

The effect of the order on the viability of Solar

[54] When questioned during the determinative conference on this issue, I asked Mr Parke what, if any effect an order of ‘some thousands’ would have on Solar’s viability. Mr Parke responded that it would hurt Solar’s cash flow and could put it in to liquidation. 6 Mr Parke submitted that any order over $5,000 could put the business into liquidation. I questioned him as to why $5,000 would be the amount, but Mr Parke stated that it was “just a figure I thought of”.7

[55] Mr Parke agreed that the business has tools, machinery and vehicles as assets, but the vehicles are subject to finance. He stated that the business has less than $10,000 cash in the bank. 8 Mr Shawn Sutton stated that he and his son would not have any idea of the assets and liabilities of the respondent.

[56] On 5 July 2018 I requested Solar provide any further evidence of the effect an order of compensation would have on the viability of Solar. No material was submitted to the Commission. On 16 July 2019, a further period of time was afforded to Solar to provide relevant material. No material was submitted, and accordingly on 23 July 2019 I informed the parties that my decision was reserved.

[57] Mr Parke has failed to provide any evidence to the Commission that the effect of an order of compensation on the viability of Solar. I do not accept his oral evidence given during the hearing that Solar had, on that date, less than $10,000 cash in its bank accounts. Mr Parke could have provided evidence of such, and he has declined to do so. Accordingly, I do not accept that there should be any discounting of an award of compensation on that basis.

The length of Mr Sutton’s service

[58] Mr Sutton submitted that he had just over 18 months’ service with Solar. Both parties agreed it was not a lengthy period of time. 9

[59] I have had regard to the decision of SDP Richards in Davidson v Griffiths Muir’s Pty Ltd[2010] FWA 4342. His Honour determined at [140]:

“As an employee for a short period of time, the length of Applicant’s service with the Respondent on its own is not a powerful force making for a compensation remedy (or a compensation order of significant quantum)”

The remuneration that Mr Sutton would have received, or would have been likely to receive, if he had not been dismissed

[60] Mr Sutton submitted that but for the dismissal, he would have continued with Solar to the completion of his apprenticeship. He submitted that he had not been getting paid by Solar in the weeks leading up to the dismissal, and he would have expected Mr Parke to respond by saying, “Yes, I’ll pay you. Can you come straight in?” 10

[61] Mr Parke submitted that Mr Sutton had ‘skipped’ a day of TAFE, and he considered it very unlikely that the employment would have lasted beyond two weeks. 11 Mr Sutton stated that he didn’t ‘skip’ TAFE; it wasn’t on that particular day.

[62] Mr Sutton’s pay slips demonstrate that he was paid $15.00 per hour. The pay slips demonstrate that there was considerable overtime worked weekly, with the majority of it all paid at time and a half, being $22.50. I questioned Mr Parke as to why the overtime payment did not extend to double-time, when, for example, 16 hours of overtime was worked in a particular week. Mr Parke’s evidence is that he does not know when employees working overtime extends into double-time payment. I also note that on some payslips, overtime was not paid until 40 hours of ordinary work.

[63] On the examination of recent payslips, I am prepared to state that Mr Sutton was earning each week, on average, 40 hours multiplied by $15.00 ($600.00), together with 15 hours of time and a half ($337.50). That amount is $937.50 gross per week. Further, I note the requirement within the Electrical, Electronic and Communications Contracting Award 2010 for attendance at TAFE to be paid, as follows:

“12.3 In order to undertake trade training, a person must be a party to a contract of apprenticeship or a training agreement in accordance with the requirements of the apprenticeship authority or State legislation. The employer must provide training and/or provide access to training consistent with the contract or training agreement without loss of pay.”

[64] Taking into account Mr Sutton’s failure to communicate with anybody from Solar until he responded to Mr Parke’s text, I conclude that he would not have worked until the completion of his apprenticeship. I conclude that Mr Sutton’s employment would have lasted no longer than eight weeks before it lawfully concluded. Regrettably, one can’t put an old head on young shoulders, and Mr Sutton’s failure to attend for work and failure to contact work would certainly have led to a brief period of continued employment.

The efforts of Mr Sutton (if any) to mitigate the loss suffered because of the dismissal

[65] Mr Sutton performed removal work between 14 December 2018 and 14 March 2019 where he earned $7,884.00. In October and November 2018 he was asking people he knew in the trade if there were any apprenticeships available. On 16 October 2018 he applied to SPL which he stated is a security company. He does not have a security licence, however he was attempting to obtain an apprenticeship, and he understood there would be some restrictions.

[66] On 24 September 2018 he applied as an apprentice for CV Services, an electrical company. He was advised that they were not looking for apprentices. He messaged friends through Facebook to inquire if they knew of available work, and he stated that he posted a Facebook status asking if anybody needed an apprentice or a labourer. Mr Parke stated that he did not wish to cross-examine Mr Sutton on his evidence. 12

[67] I am satisfied that Mr Sutton took appropriate measures to mitigate the loss suffered because of the dismissal.

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

[68] Mr Sutton earned $7,884.00 gross between 14 December 2018 and 14 March 2019. Given the period of the award of compensation does not overlap with earnings from new employment, there is no requirement to discount from the order of compensation such earnings.

The amount of any income reasonably likely to be so earned by Mr Sutton during the period between the making of the order for compensation and the actual compensation

[69] This factor is not relevant in the circumstances of this matter.

Other relevant matters

[70] No submissions were made on this consideration. I have, however, taken into consideration Mr Sutton’s young age in understanding his failure to contact his employer.

Misconduct reduces amount

[71] Section 392(3) requires that if the Commission is satisfied that the misconduct of a person contributed to the employer’s decision to dismiss the person then the Commission must reduce the amount it would otherwise order by an appropriate amount on account of the misconduct.

[72] The section requires that consideration be given by the Commission, amongst other things, as to whether a person’s misconduct contributed to the decision to dismiss an employee even if the Commission has found that there was no valid reason for the person’s dismissal. However, if there was no valid reason for the dismissal that may be relevant to the Commission’s decision as to the appropriate amount by which the amount of compensation should be reduced. 13 

[73] Mr Parke submitted that the Commission should discount any compensation payable to Mr Sutton by 70% on account of him not attending for work, and not being reporting in when TAFE finished early. Mr Shawn Sutton submitted that any act of misconduct should attract a discount of 20%, given Mr Sutton maintained that he did not receive any message from Mr Reid, even though the Commission accepted that it occurred. He can’t explain why technology failed his son. Mr Sutton agreed with his father’s submission.

[74] I accept that an award of compensation should be reduced by an amount of 20% on account of Mr Sutton’s misconduct. But for his young age, the deduction would have been 30%.

[75] The amount to be awarded is $937.50 per week, multiplied by eight weeks, less a deduction of 20%. That amount is $6,000.00 gross.

Shock, distress etc. disregarded

[76] I confirm that any amount ordered does not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt caused to Mr Sutton by the manner of the dismissal.

Compensation Cap

[77] I must reduce the amount of compensation to be ordered if it exceeds the lesser of the total amount of remuneration received by the applicant, or to which the applicant was entitled, for any period of employment with the employer during the 26 weeks immediately before the dismissal, or the high income threshold immediately prior to the dismissal.

[78] The high income threshold immediately prior to the dismissal was $145,400, and the amount for 26 weeks was $72,700. The amount of compensation the Commission will order does not exceed the compensation cap.

Payment by instalments

[79] Mr Parke submitted that any award of compensation should be paid by Solar over a period of two years, to assist with Solar’s cash flow. Mr Shawn Sutton suggested that the maximum period should be over six months.

[80] I informed the parties that typically, if I were to award payment by instalments, it has been by weeks, and not months. I questioned Mr Parke as to how much Solar could afford to pay per week. He stated $150.00 per week.

[81] I note that Mr Parke did not provide any evidence to the Commission as to the capacity of Solar to make payment on an order of the Commission. Mr Parke stated during the determinative conference that Solar had less than $10,000 in its bank account, but more than $5,000. I decline to make an order requiring the payment to be made by instalments. Mr Parke’s submissions of being able to make payment of $150 per week are not, in my view, credible, or supported by evidence.

[82] There appears to me to be a broad discretion afforded to the Commission to decide whether to allow a compensation order to be paid in instalments. While Mr Sutton would be comfortable receiving an order of compensation in instalments over six months, I have concluded that there is no supporting reason to allow for the compensation order to be paid in instalments. I am satisfied it is appropriate that Solar pay the amount of compensation within 14 days of the date of this decision.

Order of compensation

[83] I have determined that Solar is to pay to Mr Sutton the amount of $6,000.00 gross less tax as required by law within 14 days of the date of this decision.

[84] In addition, Solar is to pay superannuation on the amount of $600.00 per week, that being Mr Sutton’s ordinary hours, and not overtime, as superannuation is not payable on overtime. The amount payable is $600.00 multiplied by eight weeks, less the 20% discount for misconduct, which is equal to $3,840.00 at the rate of 9.5% into Mr Sutton’s superannuation fund. For the sake of clarity, that is an amount of $364.80 superannuation payable. This too must be paid within 14 days of the date of this decision.

[85] An Order [PR711061] to that effect will be issued with this decision.

COMMISSIONER

Appearances:

J Sutton and S Sutton for the applicant.

I Parke for the respondent.

Determinative conference details:

2019.

Brisbane.

3 July.

Final written submissions:

Applicant, 29 May 2019.

Respondent, 12 June 2019.

Printed by authority of the Commonwealth Government Printer

<PR710845>

 1   PN53.

 2 (1998) 88 IR 21.

 3   [2013] FWCFB 431.

 4   [2014] FWCFB 8683.

 5   [2015] FWCFB 2267.

 6   PN263.

 7   PN275.

 8   PN289.

 9   PN301 – 305.

 10   PN331.

 11   PN343.

 12   PN395.

 13   Crawford v BHP Coal Pty Ltd [2017] FWC 154, [345] – [346]; Read v Gordon Square Child Care Centre Inc. [2013] FWCFB 762, [83].