Mr Simson Joy Thomas Charivupurayidam v Lapa Armadale Pty Ltd T/A Lapa Brazilian Barbecue

[2017] FWC 1503

[2017] FWC 1503

FAIR WORK COMMISSION

DECISION

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

Mr Simson Joy Thomas Charivupurayidam
v
Lapa Armadale Pty Ltd T/A Lapa Brazilian Barbecue
(U2016/13716)

DEPUTY PRESIDENT BINET PERTH, 10 JULY 2017

Application for relief from unfair dismissal –Small Business Fair Dismissal Code.

[1] On 16 November 2016, Mr Simson Joy Thomas Charivupurayidam (Mr Charivupurayidam) made an application (Application) to the Fair Work Commission (FWC) pursuant to s.394 of the Fair Work Act 2009 (Cth) (FW Act) for a remedy in respect of his dismissal by Lapa Armadale Pty Ltd T/A Lapa Brazilian Barbecue (Lapa).

[2] Mr Charivupurayidam, who was employed by Lapa as a chef, was summarily dismissed from his employment after leaving his workplace before the end of his shift while there were still customers in the restaurant.

[3] Lapa deny that Mr Charivupurayidam’s dismissal was unfair. Lapa assert that it dismissed Mr Charivupurayidam due to serious misconduct and that the process which it undertook to effect that dismissal was consistent with the Small Business Fair Dismissal Code (Code).

[4] A conciliation conference was held by the FWC on 10 February 2017 but the issues in dispute between the parties could not be resolved. At the conclusion of the conference, both parties were advised that directions would be issued in relation to this matter detailing the conduct of the matter in preparation for hearing.

[5] Taking into account the circumstances of, and in the absence of any objection from, the parties, it was determined that a Determinative Conference rather than a Hearing would be the most fair and efficient way to determine the Application.

[6] In accordance with Directions issued on 28 February 2017 and 10 March 2017, the parties filed and served outlines of submissions, witness statements and documentary evidence in relation to the merits of the Application. No submissions seeking permission to be represented by a lawyer or paid agent at the Determinative Conference were filed.

[7] At the Determinative Conference on 3 April 2017, Mr Charivupurayidam gave evidence on his own behalf and Mr Mark Nylund (Mr Nylund), director and majority owner of Lapa, gave evidence on behalf of Lapa. Ms Maria Pintaudi (Ms Pintaudi), Lapa’s accountant, also gave evidence on behalf of Lapa.

Background

[8] In accordance with the Directions, the parties prepared and signed a Statement of Agreed Facts which provided a detailed account of the factual matrix. Except where indicated, the facts below are extracted from the Statement of Agreed Facts.

[9] On 4 November 2013, Mr Charivupurayidam commenced full time employment with Lapa as a Chef de Partie pursuant to a contract of employment dated 15 October 2013. 1 Mr Charivupurayidam’s contract of employment acknowledges that his employment is regulated by the Restaurant Industry Award 2010.2

[10] As at the time of the termination of his employment, Mr Charivupurayidam’s salary was $56,500.00. 3

[11] Clause 4 of Mr Charivupurayidam’s contract of employment provided that he would be based at the Armadale branch of Lapa (Lapa Armadale) but may be directed to work at other locations. 4

[12] Mr Charivupurayidam was one of three chefs employed at Lapa Armadale. The two other chefs were Mr Ahmed Muhammad Estiaque (Mr Estiaque) and Mr Cibu Thomas (Mr Thomas). Mr Charivupurayidam and Mr Estiaque were of equal status. Mr Thomas was the Sous Chef and in charge of the day to day management of the Lapa Armadale kitchen. 5

[13] Mr Charivupurayidam’s contract of employment provided that he was to report to the Head Chef & Operations Manager. The Head Chef separated from Lapa on 28 October 2016 and was not replaced. The Operations Manager is Ms Juanita Spanbroek. Notwithstanding Mr Charivupurayidam’s contract of employment, Mr Charivupurayidam was supervised by, and reported to, on a day-to-day basis Mr Thomas.  6

[14] Due to declining profitability, Lapa Armadale was temporarily closed for refurbishment on 23 October 2016 and Mr Charivupurayidam was directed to work at the Subiaco branch of Lapa (Lapa Subiaco), effective from 31 October 2016. 7 Mr Thomas was directed to work at Lapa Fremantle.

[15] The events which led to Mr Charivupurayidam’s dismissal occurred on his second rostered shift at Lapa Subiaco on 1 November 2016. 8

[16] On that day, Mr Charivupurayidam and Mr Estiaque, who had also been temporarily transferred from Lapa Armadale, were rostered to work. They commenced their shift at 2.00pm. 9

[17] The evening restaurant trade was slow and only 48 customers were served. The last customer arrived at the restaurant at 8.00pm. 10

[18] At around 8.30pm Mr Charivupurayidam asked the Restaurant Supervisor Ms Gabriela Ortiz (Ms Ortiz) if the remaining customers required dessert. Ms Ortiz replied that she did not know but would check with the customers. 11

[19] At some time between 8.30pm and 9.00pm, Mr Charivupurayidam left the restaurant. 12 Mr Charivupurayidam had been rostered to work until 10.00pm.13

[20] Mr Estiaque departed some time thereafter. 14

[21] Shortly after Mr Estiaque departed, Ms Ortiz realised that Mr Charivupurayidam had also left, and that a large pot of boiling ribs had been left on the stove with a note to the kitchen hand (the only person left in the kitchen) stating: “Please don’t forget to take out meat from stove & drain out after keep in the fridge”. Ms Ortiz also discovered a big container with cooking oil with no instructions as to what to do with it. 15

[22] The same evening, Ms Ortiz sent an email to Mr Nylund alerting to him to what had occurred and complaining that the restaurant was left with guests still in the restaurant and no chef to cook desserts. 16

[23] On 3 November 2016, Mr Nylund forwarded Ms Ortiz’s account of the events of the previous night to Mr Charivupurayidam, telling him that the allegations were very serious and inviting him to respond to the allegations. 17

[24] Mr Charivupurayidam responded by email the same day, apologising for leaving early and explaining that his child had been ill and he had been eager to go home. He also explained that he had been working in the barbeque section and, when he had finished, he had begun helping Mr Estiaque prepare desserts, which was what prompted him to check with the serving staff whether any of the remaining guests required desserts. Mr Charivupurayidam told Mr Nylund that he asked Mr Estiaque whether the guests required dessert and that: “later Estiaque told me all done that is why we left.” 18

[25] Mr Nylund stood down Mr Charivupurayidam and Mr Estiaque while he investigated the allegations and their responses. 19

[26] On 5 November 2016, Mr Nylund met with Mr Charivupurayidam and Mr Estiaque. He told both chefs that he was extremely disappointed with their conduct and equated it to “a captain leaving the ship”. He asked them what he should do; given there had been a complete breakdown in trust and an abandonment of responsibility. Mr Nylund explained that, despite not wanting to do so, he had no choice but to terminate their employment for serious misconduct effective immediately. 20

[27] On 8 November 2016, Mr Nylund sent Mr Charivupurayidam a formal written letter of termination confirming the termination of Mr Charivupurayidam’s employment effective from 5 November 2016. 21

[28] On 16 May 2017, Mr Nylund emailed Chambers and advised that Lapa Armadale (trading as Jack’s American BBQ) had ceased trading, having incurred $350,000.00 in losses in the 2016/17 financial year.

[29] Mr Charivupurayidam denies that his departure from the workplace before the end of his shift amounted to serious misconduct. Mr Charivupurayidam submits that he was unfairly dismissed, and seeks an order that he be compensated six months wages. 22

Is Mr Charivupurayidam protected from unfair dismissal?

[30] Section 396 of the FW Act requires the FWC to decide four preliminary issues before considering the merits of an application for unfair dismissal.

“396 Initial matters to be considered before merits

The FWC must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:

(a) whether the application was made within the period required in subsection 394(2);

(b) whether the person was protected from unfair dismissal;

(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;

(d) whether the dismissal was a case of genuine redundancy.”

[31] I am satisfied that the Application was made within the 21 day period required by subsection 394(2) of the FW Act. There is no assertion that Mr Charivupurayidam’s dismissal involved redundancy.

[32] Section 382 sets out the circumstances that must exist for Mr Charivupurayidam to be protected from unfair dismissal:

“382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

(b) one or more of the following apply:

(i) a modern award covers the person;

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.”

[33] There is no dispute, and I am satisfied, that Mr Charivupurayidam had completed the minimum employment period and that his annual rate of earnings was less than the high income threshold.Consequently, I am satisfied Mr Charivupurayidam was protected from unfair dismissal.

Was Mr Charivupurayidam’s dismissal unfair?

[34] Section 385 of the FW Act sets out the circumstances in which a dismissal will be considered unfair:

“385 What is an unfair dismissal

A person has been unfairly dismissed if the Commission is satisfied that:

(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.”

[35] It was not contested, and I am satisfied, that Mr Charivupurayidam was dismissed for the purposes of section 385(a) of the FW Act, and that his dismissal was not a case of genuine redundancy.

Was the dismissal consistent with the Small Business Fair Dismissal Code?

[36] Mr Nylund asserts that Lapa is a small business for the purposes of the Code and that Mr Charivupurayidam’s dismissal was consistent with the Code.

[37] Section 388(2) of the FW Act provides that:

“388 The Small Business Fair Dismissal Code

…

(2) A person’s dismissal was consistent with the Small Business Fair Dismissal Code if:

(a) immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened first), the person’s employer was a small business employer; and

(b) the employer complied with the Small Business Fair Dismissal Code in relation to the dismissal.”

[38] The term “small business” is defined in section 23 of the FW Act as follows:

“23 Meaning of small business employer

(1) A national system employer is a small business employer at a particular time if the employer employs fewer than 15 employees at that time.

(2) For the purpose of calculating the number of employees employed by the employer at a particular time:

(a) subject to paragraph (b), all employees employed by the employer at that time are to be counted; and

(b) a casual employee is not to be counted unless, at that time, he or she has been employed by the employer on a regular and systematic basis.

(3) For the purpose of calculating the number of employees employed by the employer at a particular time, associated entities are taken to be one entity.

(4) To avoid doubt, in determining whether a national system employer is a small business employer at a particular time in relation to the dismissal of an employee, or termination of an employee’s employment, the employees that are to be counted include (subject to paragraph (2)(b)):

(a) the employee who is being dismissed or whose employment is being terminated; and

(b) any other employee of the employer who is also being dismissed or whose employment is also being terminated.”

[39] Mr Nylund and Ms Pintaudi gave evidence that, at the time Mr Charivupurayidam was terminated, Lapa and its associated entities (Lapa Subiaco, Lapa Fremantle and Restaurants OPCP Pty Ltd) employed collectively a total of 11 full time employees and one casual employee engaged on a regular and systematic basis. 23

[40] On the basis of the evidence provided by Ms Pintaudi and Mr Nylund, and in the absence of any evidence to the contrary from Mr Charivupurayidam, I am satisfied that the Respondent employed fewer than 15 employees immediately before the dismissal.

[41] Consequently, I find Lapa was a small business employer within the meaning of section 23 of the FW Act.

[42] The Code was declared by the Minister for Employment and Workplace Relations on 24 June 2009 and provides as follows:

“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.”

[43] Lapa assert that Mr Charivupurayidam and Mr Estiaque abandoned their duties part way through a shift leaving the restaurant without any chefs to serve customers still in the restaurant and with duties in the kitchen uncompleted. Lapa submits that this amounted to serious misconduct, sufficiently serious to justify immediate dismissal.

[44] Mr Charivupurayidam asserts that he had completed his allocated duties before he left the restaurant and that he left the restaurant with the approval of Mr Estiaque because his child was unwell. Mr Charivupurayidam submits that his conduct did not constitute serious misconduct because it was not of the same nature as the examples of ‘serious misconduct’ given in the Code, such as theft.  24

[45] Serious misconduct is defined for the purposes of the FW Act in the Fair Work Regulations 2009 as follows:

“1.07 Meaning of serious misconduct

(1) For the definition of serious misconduct in section 12 of the Act, serious misconduct has its ordinary meaning.

(2) For sub regulation (1), conduct that is serious misconduct includes both of the following:

(a) wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment;

(b) conduct that causes serious and imminent risk to:

(i) the health or safety of a person; or

(ii) the reputation, viability or profitability of the employer’s business.

(3) For subregulation (1), conduct that is serious misconduct includes each of the following:

(a) the employee, in the course of the employee’s employment, engaging in:

(i) theft; or

(ii) fraud; or

(iii) assault;

(b) the employee being intoxicated at work;

(c) the employee refusing to carry out a lawful and reasonable instruction that is consistent with the employee’s contract of employment.

(4) Subregulation (3) does not apply if the employee is able to show that, in the circumstances, the conduct engaged in by the employee was not conduct that made employment in the period of notice unreasonable.”

[46] Mr Charivupurayidam concedes that he left the restaurant at least an hour before his shift was rostered to end and while customers were still in the restaurant. 25 His conduct was clearly deliberate.

[47] When asked to justify his conduct Mr Charivupurayidam told Mr Nylund that he left the workplace early because his child was sick and with the knowledge of Mr Estiaque.

[48] In the Statement of Agreed Facts, Mr Charivupurayidam conceded that, except for his alleged discussion with Mr Estiaque, he had not mentioned to any staff member that his son was ill until Mr Nylund requested an explanation on 3 November 2016 for Mr Charivupurayidam’s early departure from the workplace. 26

[49] Mr Charivupurayidam did not, at any time, apply for personal or recreational leave in relation to his absence from work on 1 November 2016.

[50] Mr Charivupurayidam did not provide any evidence prior to these proceedings that his son had been ill. The medical certificate which was tendered at the hearing was dated 13 January 2017 and stated that Mr Charivupurayidam’s son was “… unwell and undergoing treatment from end of October 2016 till November 2016.” 27

[51] Another medical report tendered indicated that Mr Charivupurayidam’s son had been hospitalised in India for 7 days in early October. 28

[52] No evidence was tendered which indicated that Mr Charivupurayidam’s son’s condition had worsened on the day on which Mr Charivupurayidam left work early or that the child’s mother was unavailable to care for the child on that date.

[53] It was not until these proceedings that Mr Charivupurayidam asserted that it was custom and practise for staff to leave before the completion of their shifts if they had completed their duties, that his duties did not include responsibility for the preparation of desserts and that he was expressly authorised by Mr Estiaque on the evening in question, to leave before his shift was rostered to finish. 29

[54] At the Hearing, when questioned, Mr Charivupurayidam conceded that he had never previously left the workplace before the end of his rostered shift. 30

[55] Mr Charivupurayidam also conceded that Mr Estiaque was at the same level as himself and that, in fact, he was uncertain who was authorised to approve his early departure because he had only recently started working at Lapa Subiaco. 31

[56] Mr Charivupurayidam acknowledged that he was aware that two customers potentially required dessert. Mr Charivupurayidam says that he was responsible for the barbeque area of the kitchen and had completed these duties before he departed from the workplace. He claims he was not responsible for the preparation of desserts. 32

[57] Mr Nylund asserts that the work duties of the two chefs were not as strictly demarcated as asserted by Mr Charivupurayidam and both employees were equally responsible for ensuring that all orders, including dessert orders were filled.

[58] I prefer Mr Nylund’s evidence in this regard, given that Mr Charivupurayidam admits that once he completed his barbeque duties he began assisting Mr Estiaque prepare desserts. He also admits that it was he, rather than Mr Estiaque, who asked Ms Ortiz to confirm whether the remaining customers wished to order dessert. Having asked Ms Ortiz to confirm whether the customers wished to order dessert, Mr Charivupurayidam failed to check the outcome of his inquiry with her before he departed from the workplace.

[59] After being alerted to Mr Charivupurayidam’s early departure from the workplace Mr Nylund immediately raised these allegations with Mr Charivupurayidam in writing providing him with a full copy of the report from Ms Ortiz. Mr Nylund provided Mr Charivupurayidam with the opportunity to respond to the allegations in writing. Mr Nylund then undertook an investigation which included interviewing Ms Ortiz and discussing appropriate disciplinary action with Mr Charivupurayidam’s supervisor and his business co-owner. Mr Nylund subsequently met with Mr Charivupurayidam and discussed his findings and the proposed disciplinary action.

[60] Given the reach and influence of customer online restaurant reviews, even a single instance of poor service poses risk to the reputation, viability and profitability of a restaurant. I am satisfied that Mr Nylund had reasonable grounds for believing that Mr Charivupurayidam and Mr Estiaque’s deliberate early departure from the workplace, leaving the restaurant without any chef during food service and tasks uncompleted in the kitchen, was inconsistent with the continuation of their contracts of employment because that conduct posed a serious risk to the reputation, viability or profitability of his business. I am not satisfied the conduct was sufficient to justify Mr Charivupurayidam’s immediate dismissal.

[61] In all the circumstances, I am not satisfied the dismissal of Mr Charivupurayidam was consistent with the Code.

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

[62] Having been satisfied of each of s.385(a),(c)-(d) of the FW Act, it is necessary to determine whether Mr Charivupurayidam’s dismissal was harsh, unjust or unreasonable. The criteria to be taken into account when assessing whether the dismissal was harsh, unjust or unreasonable are set out at s.387 of the FW Act:

“387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the Commission 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 Commission considers relevant.”

[63] The ambit of the conduct which may fall within the phrase ‘harsh, unjust or unreasonable’ was explained in Byrne v Australian Airlines Ltd(1995) 185 CLR 410 at 465 by McHugh and Gummow JJ as follows:

“.... 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 may 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.”

[64] To determine whether Mr Charivupurayidam’s dismissal was, in the circumstances, harsh, unjust or unreasonable, it is necessary to consider each of the criteria set out in section 387 of the FW Act.

Did Lapa have a valid reason for dismissing Mr Charivupurayidam?

[65] An employer must have a valid reason for the dismissal of an employee protected from unfair dismissal, although it need not be the reason given to the employee at the time of the dismissal.³³ The reasons should be ‘sound, defensible and well founded’³⁴ and should not be ‘capricious, fanciful, spiteful or prejudiced.’³⁵ The reason must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. The requirement to be reasonable must be applied in a practical common sense way to ensure that the employer and employee are each treated fairly. 36

[66] For the reasons outlined earlier in this decision I am satisfied that Lapa had a valid reason for Mr Charivupurayidam’s dismissal.

Was Mr Charivupurayidam notified of the reason for his dismissal?

[67] Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made, 37 in explicit terms38 and in plain and clear terms.39 In Crozier v Palazzo Corporation Pty Ltd40 a Full Bench of the Australian Industrial Relations Commission dealing with similar provision of the Workplace Relations FW Act 1996 (Cth) stated the following:

“As a matter of logic procedural fairness would require that an employee be notified of a valid reason for their termination before any decision is taken to terminate their employment in order to provide them with an opportunity to respond to the reason identified. Section 170(3)(b) and (c) would have very little (if any) practical effect if it was sufficient to notify employees and give them an opportunity to respond after a decision had been taken to terminate their employment. Much like shutting the stable door after the horse has bolted.” 41

[68] In his email of 3 November 2016, Mr Nylund put Mr Charivupurayidam on notice that serious allegations had been made against him and the precise nature of those allegations.

[69] I find therefore that Mr Charivupurayidam was notified of the reason for the dismissal.

Was Mr Charivupurayidam given an opportunity to respond to the reasons for his dismissal?

[70] An employee protected from unfair dismissal must be provided with an opportunity to respond to any reason for dismissal relating to the conduct or capacity of the person. This criterion is to be applied in a common sense way to ensure the employee is treated fairly and should not be burdened with formality. 42

[71] In his email of 3 November 2016, Mr Nylund put Mr Charivupurayidam on notice that serious allegations had been made against him and provided Mr Charivupurayidam with an opportunity to respond to those allegations. Mr Charivupurayidam responded in writing the same day by return email. 43

[72] Mr Charivupurayidam was given a second opportunity to respond to the allegations at the meeting on 5 November 2016. 44

[73] I find Mr Charivupurayidam was given a genuine opportunity to respond to the reasons for the dismissal.

Did Lapa unreasonably refuse to allow Mr Charivupurayidam a support person?

[74] Where an employee protected from unfair dismissal has requested a support person be present to assist in discussions relating to the dismissal, the employer should not unreasonably refuse that person being present.

[75] Mr Charivupurayidam asserts that he was not aware that the meeting held on 5 November 2016 would involve discussions relating to his dismissal and therefore he did not request the presence of a support person at that meeting. 45

[76] Given that Mr Nylund clearly stated in his email of 3 November 2016 that he considered the allegations “very serious” and that he required Mr Charivupurayidam to provide his version of events promptly, Mr Charivupurayidam should have been on notice that the subsequent meeting could involve disciplinary consequences which might include termination of his employment.

[77] In any event Mr Charivupurayidam was accompanied by Mr Estiaque to the meeting of 5 November 2016 and did not attend the meeting on his own.

[78] I find Lapa did not unreasonably refuse to allow Mr Charivupurayidam to have a support person present at discussions relating to his dismissal.

Was Mr Charivupurayidam given any warning regarding unsatisfactory performance?

[79] Where an employee protected from unfair dismissal is dismissed for the reason of unsatisfactory performance, the employer should warn the employer about the unsatisfactory performance before the dismissal. Unsatisfactory performance is more likely to relate to an employee’s capacity than their conduct. 46

[80] Mr Charivupurayidam was not dismissed because of unsatisfactory performance so this criterion is not relevant.

Did the size of Lapa and the absence of dedicated human resources management specialist/expertise impact on the procedures followed?

[81] The size of the Respondent’s enterprise and/or the absence of dedicated human resource management or expertise in the Respondent’s enterprise can have impact on the procedures followed by an employer in effecting a dismissal.

[82] Mr Nylund submits that he did not appreciate the complexities involved in adhering to the FW Act due to the size of the business, and his lack of human resources expertise. 47

[83] Never the less I am satisfied that Mr Nylund afforded Mr Charivupurayidam procedural fairness in the termination process except to the extent Mr Nylund did not appreciate that Mr Charivupurayidam’s conduct did not warrant the summary termination of his employment and that instead Mr Charivupurayidam’s employment ought to have been terminated on notice.

[84] In this regard I find the size of Lapa and the absence of any HR management or expertise may have an impact on notice period provided to Mr Charivupurayidam and consequently the fairness of Mr Charivupurayidam’s dismissal

Other relevant matters

[85] Section 387(h) provides the Commission with a broad scope to consider any other matters it considers relevant.

[86] Mr Charivupurayidam submitted that his dismissal was a disproportionate response to his conduct.

[87] While I am satisfied that Mr Charivupurayidam’s dismissal was for a valid reason and otherwise procedurally fair, I find that his dismissal was harsh because he was dismissed summarily without notice in circumstances when termination on notice would have been a proportionate response to his conduct.

[88] Accordingly, I find that Mr Charivupurayidam’s dismissal was unfair.

May a remedy be ordered?

[89] Mr Charivupurayidam seeks an order that he be compensated six months wages. 48 Section 390 of the FW Act sets out the circumstances in which an order for reinstatement or compensation may be made:

“390 When the Commission may order remedy for unfair dismissal

(1) Subject to subsection (3), the Commission may order a person’s reinstatement, or the payment of compensation to a person, if:

(a) the Commission 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 Commission may make the order only if the person has made an application under section 394.

(3) The Commission must not order the payment of compensation to the person unless:

(a) the Commission is satisfied that reinstatement of the person is inappropriate; and

(b) the Commission 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.”

[90] I am satisfied the Mr Charivupurayidam was protected from unfair dismissal pursuant to section 382 of the FW Act and that his dismissal was unfair.

Is an order for reinstatement appropriate?

[91] Mr Charivupurayidam seeks compensation as a remedy for his unfair dismissal. Regardless of the remedy sought by Mr Charivupurayidam, section 390 of the FW Act requires I first determine whether reinstatement is appropriate before I consider making an order for compensation.

[92] Mr Charivupurayidam submits reinstatement would be inappropriate because he does not trust Mr Nylund anymore and he believes that other employees would view him as a “culprit.” 49

[93] Lapa submit that reinstatement would be inappropriate because Mr Charivupurayidam was based at Lapa Armadale and the restaurant has since ceased trading. 50

[94] In these circumstances, I find that reinstatement is not an appropriate remedy.

Is an order for compensation appropriate?

[95] Section 390(3)(b) provides that an order for compensation to Mr Charivupurayidam may only be made if it is appropriate in all the circumstances.

[96] Section 392 of the FW Act sets out the circumstances that must be taken into consideration when determining an amount of compensation, the effect of any findings of misconduct on that compensation amount and the upper limit of compensation that may be ordered:

“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 Commission 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 Commission considers relevant.

Misconduct reduces amount

(3) If the Commission is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the Commission 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 Commission 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 Commission 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.”

[97] The method for calculating compensation under section 392 of the FW Act was recently dealt with by a Full Bench of the Commission in Bowden, G v Ottrey Homes Cobram and District Retirement Villages Inc. T/A Ottrey Lodge 51 (Bowden). In that decision the Full Bench set out the order in which the criteria and other factors should be applied, taking into account authority under the Workplace Relations FW Act 1996 in Sprigg v Paul’s Licensed Festival Supermarket52 and Ellawala v Australian Postal Corporation53. I have adopted the methodology utilised in Bowden in determining the amount of a payment of compensation.

[98] Mr Charivupurayidam's remuneration was $56,500 per annum. 54]

[99] While Mr Charivupurayidam’s conduct did not justify summary dismissal I am satisfied that Lapa had a valid reason for dismissing him in accordance with the terms of his contract of employment and the relevant Award. Pursuant to both his contract of employment and the Award Mr Charivupurayidam was entitled to 3 weeks notice.

[100] I find that Mr Charivupurayidam would have continued to be employed by Lapa for three weeks had he not been dismissed. The amount Mr Charivupurayidam would have received is therefore $3,259.61

[101] Mr Charivupurayidam gave evidence at the Hearing that up to the date of the Hearing he had earned $3987.47 from Beach Partnership and $758.51 from Skill Hire. 55

[102] I find the Applicant has earned at total of $4745.98 in remuneration for employment or other work during the period since the dismissal and deduct this amount from the compensation to be ordered.

[103] Mr Nylund gave evidence that Lapa sustained trading losses of $277,000 between 1 July 2016 and 28 February 2017 and as at the date of the hearing was experiencing a trading loss of $8,000 week and if not sold before 30 April 2017 would be closed. 56 Mr Nylund said that the restaurant was only trading because of his personal financial contributions which had already exceeded $300,000 in the previous six months.57

[104] Following the hearing Mr Nylund advised Chambers that the Armadale restaurant had, in fact, closed.

[105] In these circumstances I find an order for compensation would affect the viability of the Respondent’s enterprise and on this ground would reduce the amount of compensation to zero.

[106] I find that Mr Charivupurayidam’s period of service with Lapa, should not affect the amount of compensation to be ordered.

[107] At the conclusion of the meeting on 5 November 2016 Mr Nylund offered to recommend Mr Charivupurayidam to a friend who owned a restaurant in Byford. The same day Mr Nylund contacted Mr Tan and Mr Tan confirmed that he did need chefs. 58

[108] Mr Nylund texted Mr Tan’s contact details to Mr Charivupurayidam. 59

[109] Mr Charivupurayidam initially denied receiving Mr Nylund’s text then subsequently conceded that he became aware of it and decided not to contact Mr Tan. 60

[110] I find that the Applicant could have made greater efforts to mitigate the loss he suffered as a result of the dismissal.

[111] A finding has been made that the Respondent had a valid reason for dismissing Mr Charivupurayidam. Section 392(3) requires the amount of compensation that would have been ordered under s.392(1) be reduced by an appropriate amount on account of the misconduct.

Conclusion

[112] I am satisfied that Mr Charivupurayidam was protected from unfair dismissal, that the dismissal was unfair and a remedy of reinstatement or compensation is not appropriate.

[113] An order will be issued with this decision.

DEPUTY PRESIDENT

Appearances:

T Charivupurayidam, Applicant.

M Nylund on behalf of the Respondent.

Hearing details:

2017:

Perth:

April 3.

 1 Exhibit R4 at [1].

 2   Exhibit A3.

 3 Exhibit R4 at [1]...

 4   Exhibit A3.

 5   Exhibit R4 at [3] and [6]

 6 Exhibit R4 at [4].

 7   Exhibit R4 at [15]-[16].

 8   Exhibit R4 at [24] and Exhibit A1.

 9 Exhibit R4 at [24].

 10 Exhibit R4 at [24].

 11 Exhibit R4 at [24].

 12 Exhibit R4 at [24].

 13   Transcript PN138.

 14 Exhibit R4 at [25].

 15   Exhibit R4 at [25]

 16 Exhibit R4 at [25].

 17 Exhibit R4 at [25].

 18 Exhibit R4 at [25].

 19 Exhibit R4 at [26].

 20 Exhibit R4 at [27].

 21   Exhibit R4 at [29.]

 22   Exhibit A1.

 23   Exhibit R2, Exhibit R5 at [2] and PN49 – PN129.

 24   Transcript PN135 - PN136.

 25   Transcript PN139-PN142.

 26 Exhibit R4 at [30].

 27   Exhibit A5.

 28   Ibid.

 29   Exhibit A1.

 30   Transcript PN169-PN170.

 31   Transcript PN151

 32   Transcript PN148-PN149

33 Shepherd v Felt & Textiles of Australia Ltd (1931) 45 CLR 359, 373, 377-378.

34 Selvachandran v Peterson Plastics Pty Ltd (1995) 62 IR 371, 373.

35 Ibid.

 36   Ibid.

 37   Chubb Security Australia Pty Ltd v Thomas Print S2679 at [41].

 38   Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, 151.

 39   Previsic v Australian Quarantine Inspection Services Print Q3730.

 40 (2000) 98 IR 137.

 41   Ibid at 151.

 42   RMIT v Asher (2010) 194 IR 1, 14-15.

 43   Transcript PN175-PN176.

 44   Transcript PN231.

 45   Transcript PN183-PN184.

 46   Annetta v Ansett Australia Ltd (2000) 98 IR 233, 237.

 47 Exhibit R1 at [16].

 48   Exhibit A1.

 49   Exhibit A1.

 50   Exhibit R3 at 13.

 51   [2013] FWCFB 431.

 52 (1998) 88 IR 21.

 53   Print S5109.

 54   Exhibit R4 at [1]

 55   Exhibit A8 and Exhibit A6.

 56 Exhibit R5 at [12].

 57   Transcript PN591

 58   Exhibit R5 at [8]-[11].

 59   Exhibit R5 at [8]-[11].

 60   Transcript PN585-PN587

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