Mr Peter Bradley v United Petroleum Transport Pty Ltd
[2023] FWC 3126
•28 NOVEMBER 2023
| [2023] FWC 3126 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Mr Peter Bradley
v
United Petroleum Transport Pty Ltd
(U2022/9113)
| COMMISSIONER SCHNEIDER | PERTH, 28 NOVEMBER 2023 |
Application for an unfair dismissal remedy
On 12 October 2023, the Fair Work Commission (the Commission) issued a Decision [[2023] FWC 2628][1] finding that Mr Peter Bradley (the Applicant) had been unfairly dismissed by his employer United Petroleum Transport Pty Ltd (the Respondent) pursuant to section 394 of the Fair Work Act 2009 (Cth) (the Act).
Subsequently, the parties were directed to file submissions in relation to remedy.
The Applicant failed to provide any submissions or evidence despite being directed to do so. Consequently, on 26 October 2023, Chambers wrote to the Applicant and confirmed the below:
“The Commissioner has reviewed the previous hearing recording and would like to confirm the below evidence, provided during cross examination of the Applicant:
· Employment ceased on 3 September 2022.
· Paid a redundancy payment of 6 weeks.
· Paid 3 weeks’ notice.
· In total, received 9 weeks payment at the conclusion of employment.
· From 24 October 2022, employed at Hill’s Transport in Mackay for 2 weeks and received 1 weeks notice of termination.
· From 27 November 2022, employed at Lowe’s transport in Mackay.
· At the time of the hearing, still employed fulltime by Lowe Transport, however, on unpaid personal leave at that time.
As the Applicant has failed to provide any further submissions in relation to remedy, the Commissioner will rely on the above in his remedy determination.”
The Respondent filed submissions on 8 November 2023.
Subsequently, I make this determination concerning remedy on the papers.
Remedy
In the circumstances, where I have found that the Applicant was protected by unfair dismissal at the time of being dismissed and that he was unfairly dismissed from his employment by the Respondent, I now turn to addressing the element of remedy, as prescribed under section 390 of the Act.
Accordingly, I am satisfied that the Applicant:
· made an application for an order granting a remedy under section 394;
· was a person protected from unfair dismissal; and
· was unfairly dismissed within the meaning of section 385 of the Act,
Subject to the prescribed requirements under section 390 of the Act, I will consider ordering the Applicant’s reinstatement or the payment of compensation to the Applicant if satisfied that such an order is appropriate in all the circumstances of the matter.
Legislation
Under section 390(3) of the Act, I must not order the payment of compensation to the Applicant unless:
(a) I am satisfied that reinstatement of the Applicant is inappropriate; and
(b) I consider an order for payment of compensation is appropriate in all the circumstances of the case.
Further, 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
(2) 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
(3) 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
(c) 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.”
In relation to reinstatement, section 391 of the Act provides that:
“391 Remedy—reinstatement etc.
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 the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC 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 the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC 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), the FWC 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.”
Reinstatement – Appropriateness
Submissions
The Applicant in his initial application filed with the Commission sought compensation. The Applicant did not file any submissions in relation to reinstatement.
The Respondent submits that, as it no longer requires the Applicant’s position to be performed by anyone, an order for reinstatement would not be appropriate.
Findings
Having regard to the above and based on the information provided by the Applicant at the hearing, the Applicant is meaningfully employed with another employer.
Having considered this, I am satisfied that there exists mutual contention and shared understanding that both parties agree reinstatement is not an appropriate remedy in the circumstances.
Having regard to the matters referred to above, I consider that reinstatement is inappropriate.
I will now consider whether a payment for compensation is appropriate in all the circumstances.
Compensation – Appropriateness
Having found that reinstatement is inappropriate, it does not automatically follow that a payment for compensation is appropriate.
As noted by the Full Bench in Nguyen v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter:[2]
“[t]he question whether to order a remedy in a case where a dismissal has been found to be unfair remains a discretionary one…”[3]
Where an applicant has suffered financial loss as a result of the dismissal, this may be a relevant consideration in the exercise of this discretion.[4]
Submissions
The Applicant did not file any submissions. However, in the application form the Applicant confirmed that they are seeking compensation.
The Respondent submits that payment of compensation is the appropriate remedy in this circumstance.
Findings
Due to the Respondent’s decision to unjustly terminate the Applicant’s employment, I find that an order for compensation is appropriate.
Compensation – Considerations
Section 392(2) of the Act requires all of the circumstances of the case to be taken into account when determining an amount to be paid as compensation to the Applicant in lieu of reinstatement including:
(a)the effect of the order on the viability of the Respondent’s enterprise;
(b)the length of the Applicant’s service;
(c)the remuneration that the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed;
(d)the efforts of the Applicant (if any) to mitigate the loss suffered by the Applicant because of the dismissal;
(e)the amount of any remuneration earned by the Applicant from employment or other work during the period between the dismissal and the making of the order for compensation;
(f)the amount of any income reasonably likely to be so earned by the Applicant during the period between the making of the order for compensation and the actual compensation; and
(g)any other matter that the Commission considers relevant.
I consider all the circumstances of the case currently before the Commission below.
Effect of the order on the viability of the Respondent’s enterprise
The Respondent confirmed that any order for compensation would not have an effect on the viability of the employer’s enterprise.
Length of the Applicant’s service
The Applicant’s length of service with the Respondent was 2 years and 2 weeks.
The Applicant did not make any submissions in relation to the length of service being a factor to increase the amount of compensation ordered.
The Respondent submits that the Applicant’s length of service was not an extended period of time.
The Respondent submits that the Applicant’s length of service in this case should not weigh in favour of increasing the amount of compensation ordered.
I consider that the Applicant’s length of service does not support reducing or increasing the amount of compensation ordered and is a neutral consideration.
Remuneration that the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed
As stated by the majority in He v Lewin;
“[i]n determining the remuneration that the Applicant would have received, or would have been likely to receive… the Commission must address itself to the question whether, if the actual termination had not occurred, the employment would have been likely to continue, or would have been terminated at some time by another means. It is necessary for the Commission to make a finding of fact as to the likelihood of a further termination, in order to be able to assess the amount of remuneration the employee would have received, or would have been likely to receive, if there had not been the actual termination.”[5]
The Applicant did not provide any detailed submissions or evidence in relation to this point. At the hearing on merits, the Applicant confirmed that the hourly rates at his current employment were similar or close to that of the Respondent. However, there was less overtime available at his new employment which impacted his overall earnings. Despite being provided with the opportunity to provide evidence in support of this claim, the Applicant failed to provide any evidence to support this statement.
The Respondent notes that the dismissal was deemed unfair as the Respondent failed to provide the Applicant with procedural fairness.
The Respondent submits that had they formally consulted with the Applicant over the redeployment of the operation then the Applicant’s employment would have ended after an additional two weeks.
Accordingly, the Respondent submits that the Applicant should only receive compensation for a maximum period of one or two weeks.
The Respondent asserts that this duration is reflective of the length of time in which the Respondent could have conducted a procedurally fair process. The Respondent submits this is consistent with the finding of the majority in UES v Harvey.[6]
I accept the position of the Respondent that, if had they followed a procedurally fair process, it would be reasonable to conclude that the Applicant’s employment would have ceased in a period of no more than two weeks.
Efforts of the Applicant to mitigate the loss suffered by the Applicant because of the dismissal
The Applicant must provide evidence that they have taken reasonable steps to minimise the impact of the dismissal.[7] What is reasonable depends on the circumstances of the case.[8]
The Applicant, when giving evidence before the Commission, confirmed that he had taken the below steps to mitigate his loss:
· Commenced employment with Hill’s Transport in Mackay on 24 October 2022.
· The Applicant was employed by Hill’s Transport for approximately two to three weeks.
· Commenced employment with Lowe’s Transport in Mackay on 27 November 2022.
· At the time of the hearing the Applicant was still employed with Lowe’s Transport, the Applicant has not provided any evidence that his employment with Lowe’s Transport has ceased.
The Respondent did not dispute that the Applicant had taken steps to mitigate his loss.
I am satisfied that, in the circumstances of this case, the Applicant took reasonable steps to mitigate their loss by obtaining employment after the termination of his employment with the Respondent.
Amount of remuneration earned by the Applicant from employment or other work during the period between the dismissal and the making of the order for compensation
The Applicant was paid a termination payment when the Respondent made the Applicant redundant. In total, the Applicant received nine weeks’ payment, which was made up of three weeks’ notice in lieu and six weeks’ redundancy.
The Applicant commenced new employment with Hill’s Transport in Mackay, this was approximately 7 weeks after his employment with the Respondent was terminated.
The Applicant ceased working with Hill’s Transport in mid-November 2022 and commenced employment with Lowe’s Transport in on 27 November 2022.
The Respondent submitted that the nine-week payment received by the Applicant, covered the Applicant until he had found alternative employment first with Hill’s Transport then with Lowe’s Transport.
The Respondent submits that the Applicant’s loss was fully mitigated by the redundancy payment he received prior to the commencement of new employment. Therefore, the Applicant should not receive any financial compensation.
The Respondent also noted that, due to the different legislative requirements between Western Australia and Queensland, in Queensland there are laws that place a restriction on the number of hours the Applicant can work per week or fortnight which are not applicable in Western Australia.
The Respondent also highlighted the evidence of the Applicant at the hearing, in which the Applicant confirmed that there were quiet periods in the Respondent’s business so therefore it is not possible to conclude that the Applicant was always working a significant amount of overtime.
Amount of income reasonably likely to be so earned by the Applicant during the period between the making of the order for compensation and the actual compensation
The Respondent submitted that there is no reason to believe there will be any delay between an order and payment. The Respondent submitted that there is no evidence on current earnings for the Commission to consider.
Other relevant matters
The Respondent also highlighted that the parties were in dispute over the rate of pay the Applicant earned per week. The figure provided by the Applicant was $2,909.09 per week. The Respondent submitted that the correct figure is $2,096.44 per week. I note that, in either case, the calculation below results in nil.
Compensation – Calculation
As noted by the Full Bench in Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries:
“[t]he well-established approach to the assessment of compensation under s.392 of the FW Act… is to apply the “Sprigg formula” derived from the Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul’s Licensed Festival Supermarket (Sprigg).[9] This approach was articulated in the context of the FW Act in Bowden v Ottrey Homes Cobram and District Retirement Villages[10].”[11]
The approach in Sprigg is as follows:
· Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).
· Step 2: Deduct monies earned since termination. Workers’ compensation payments are deducted but not social security payments. The failure of an applicant to mitigate his or her loss may lead to a reduction in the amount of compensation ordered.
· Step 3: Discount the remaining amount for contingencies.
· Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.
Step 1
I have estimated the total amount of remuneration the Applicant would have received or would have been likely to receive, had the Respondent not terminated the employment, to be $5,818.18 using the Applicant calculations.
I have determined that this figure is appropriate based on my finding that it was likely that the Applicant would have remained employed for a further two weeks with the Respondent.
This estimate of how long the Applicant would have remained in employment is the “anticipated period of employment”.[12]
Step 2
I have found that as the Applicant’s employment would have ended within two weeks, had the Respondent followed a procedurally fair process.
Only monies earned since termination for the anticipated period of employment are to be deducted.[13]
The Respondent submits that the Applicant was paid in total three weeks’ notice in lieu and six weeks’ redundancy, this equates to an amount of nine weeks in total. From the final payslip received, the Applicant received a redundancy payment of $27,047.25.
Based on the information provided by the Applicant at the hearing, the Applicant worked for three weeks at Hill’s Transport and had completed around four weeks’ work for Lowe’s Transport before commencing a period of personal leave.
I have formulated this number based on the below calculations:
· Hill’s Tankers = $50.53 per hour x 38 per week x 3 weeks = $5,760.42
· Lowe’s Transport = $50.53 per hour x 38 per week x 4 weeks = $7,680.56
The above is based on the Applicant confirming his hourly rate was similar or the same as to what he earned with the Respondent. I have also not factored any overtime into the above calculations. Based on the above calculations, a conservative estimate of the Applicant’s earnings in this period would be $13,440.98.
I therefore deduct the sum of $13,440.98 from $5,818.18. It is therefore evident that the redundancy payment and remuneration earned by the Applicant at his new employment has offset the estimated remuneration in the event the Applicant’s employment continued for a further period of two weeks.
Step 3
I now need to consider the impact of contingencies on the amounts likely to be earned by the Applicant for the remainder of the anticipated period of employment.[14]
Having found that the Applicant’s employment would have been terminated within two weeks, had the Respondent followed a procedurally fair process, I do not consider there needs to be a further deduction for any other contingencies in this matter.
Step 4
Having considered the above, I determine that the appropriate compensation is $0.
Having applied the formula in Sprigg, I am nevertheless required to ensure that “the level of compensation is an amount that is considered appropriate having regard to all the circumstances of the case”[15], notably:
· Confirmation from the Respondent that any potential compensation will not negatively impact the viability of the enterprise.
· Having found that, if the Respondent followed a procedurally fair process, the Applicant’s employment would have ended within a period of no more than two weeks.
· Having considered the Applicant’s steps to mitigate his loss and find alternative employment.
I am satisfied the amount of compensation, that I have determined above, takes into account all the circumstances of the case as required by section 392(2) of the Act.
Compensation – Reductions
If I am satisfied that misconduct of the Applicant contributed to the employer’s decision to dismiss, I am obliged by section 392(3) of the Act to reduce the amount I would otherwise order, by an appropriate amount, on account of the misconduct.
I am satisfied that there is no evidence or suggestion of misconduct on behalf of the Applicant.
Therefore, this consideration is not relevant.
Compensation – Cap
Section 392(5) of the Act provides that the amount of compensation ordered by the Commission must not exceed the lesser of:
(a)the amount worked out under section 392(6); and
(b)half the amount of the high-income threshold immediately before the dismissal.
The amount worked out under section 392(6) of the Act is the total of the following amounts:
(a)the total amount of the remuneration:
(a) received by the Applicant; or
(ii) to which the Applicant 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 Applicant 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 Applicant for the period of leave in accordance with the regulations.
The Applicant was not on leave without pay or without full pay during the 26 weeks immediately before the dismissal.
Based on the figures provided, the Applicant’s earnings in the 26 weeks prior to his dismissal were approximately $75,636.34 ($2,909.09 x 26 weeks).
The high-income threshold immediately before the dismissal was $158,500. Half of that amount is $79,250.
The amount of compensation ordered by the Commission must therefore not exceed $75,636.34.
I confirm that, consistent with section 394(2) of the Act, the amount does not include payment for shock, distress, or humiliation caused by the Applicant’s dismissal.
Conclusion
I have found that the dismissal of the Applicant was unfair, and that reinstatement is not appropriate.
I have found that compensation is an appropriate remedy in this matter.
However, due to the calculations above, I decline to order the payment of any compensation.
Due to the Applicant so successfully mitigating any loss and the previous payment made upon his termination, any compensation that could be ordered under the Act has been reduced to nil.
The matter is determined accordingly.
COMMISSIONER
[1] [PR767075].
[2] [2014] FWCFB 7198.
[3] Ibid, [9].
[4] [2020] FWCFB 550, [20]; [2015] FWCFB 4171, [5]-[7].
[5] [2004] FCAFC 161, [58].
[6] [2012] FWAFB 5241, [43] and [53].
[7] PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34]; citing PR908053 (AIRCFB, Giudice J, Lacy SDP, Blair C, 23 August 2001), [45].
[8] PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34]; citing [1919] 2 KB 581; see also, [2015] FWCFC 2267, [23]; citing, PR915963, [34].
[9] (1998) 88 IR 21.
[10] [2013] FWCFB 431.
[11] [2016] FWCFB 7206, [16].
[12] Print S5109 (AIRCFB, Ross VP, Williams SDP, Gay C, 17 April 2000), [34].
[13] Ibid.
[14] PR910779 (AIRCFB, Williams SDP, Acton SDP, Gay C, 31 October 2001), [39].
[15] [2016] FWCFB 7206, [17].
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