Mr Steven Rouessart v Automotive Sales Vic Pty Ltd
[2024] FWC 1917
•26 JULY 2024
| [2024] FWC 1917 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Mr Steven Rouessart
v
Automotive Sales Vic Pty Ltd
(U2024/17)
| COMMISSIONER WILSON | MELBOURNE, 26 JULY 2024 |
Application for an unfair dismissal remedy. Merits considered. Dismissal found to be unfair. Compensation appropriate.
This decision concerns an application for an unfair dismissal remedy made by Steven Rouessart (the Applicant) pursuant to s.394 of the Fair Work Act 2009 (the FW Act). The application was filed in the Fair Work Commission (the Commission) on 1 January 2024, after he was dismissed by Automotive Sales Vic Pty Ltd, trading as North East Shepparton (North East Shepparton, or the Respondent), with effect from Monday, 11 December 2023.
For the reasons set out below I find Mr Rouessart was unfairly dismissed and that while reinstatement is inappropriate an award of compensation is appropriate.
PRELIMINARIES
Section 396 of the FW Act requires the determination of four initial matters before consideration of the merits of the application. Those matters are whether the application was made within the period required in s.394(2), whether the person was protected from unfair dismissal, whether the dismissal was consistent with the Small Business Fair Dismissal Code, and whether the dismissal was a case of genuine redundancy. Neither party put forward that any of the initial matters required consideration. In relation to the elements within s.396, I find that Mr Rouessart’s application was lodged with the Commission within the 21-day period for making such applications, that at the relevant time he was dismissed he was a person protected from unfair dismissal and that a question of whether his dismissal was a genuine redundancy does not arise. The Respondent is not a small business employer, and consideration of the Small Business Fair Dismissal Code is not required.
The merits of the application were the subject of a determinative conference convened by me on 11 and 23 May 2024, at which Mr Rouessart appeared for himself. Mr Ned Politt, Human Resources Business Partner of the North East Group appeared for the Respondent.
Evidence was given in these proceedings by Mr Rouessart on his own behalf and by his wife, Ms Lisa Rouessart. Evidence was given on behalf of the Respondent by Mr Deane Crowhurst, Dealer Principal with North East Shepparton and Ms Suzanne Cornish, Group Manager, Strategic Projects with the parent company, the North East Group.
BACKGROUND
Mr Rouessart was employed by North East Shepparton as a Truck Sales Manager on 23 January 2023 and dismissed on Monday, 11 December 2023. North East Shepparton is part of a group of truck sales companies in South Australia and Victoria.
Before he started with North East Shepparton, Mr Rouessart was provided with a letter of offer which dealt with a number of matters relevant to this decision, including his hours of work, salary arrangements and access to private use of a company supplied motor vehicle. The letter of offer is dated 18 January 2023 and relates to employment that started on 23 January 2023. On 20 January 2023, a People & Culture Advisor with the North East Group sent Mr Rouessart an email enclosing a draft Employment Contract and invited him to sign and return the contract. A signed copy of the contract is not before the Commission, with the Respondent arguing that there is “implied consent” to the terms of the draft, as Mr Rouessart worked to its terms for the period of his employment.[1]
The following may be drawn from these documents with respect to hours of work and reasonable private use of a company issued motor vehicle;
Hours of work
oThe letter of offer of employment states first that Mr Rouessart’s conditions of employment are in accordance with the Vehicle Repair, Services and Retail Award 2020; and second that in respect of working hours;
“This is a full time position requiring approximately 38 hours + per week. Your regular weekly schedule will be from Monday to Friday, with regular expected hours being from _8_am to _5_pm and occasional Saturday’s”[2]
oThe unsigned “Employment Contract” provides, not inconsistently;
“6.3. The Employee will be required to work a minimum of 38 hours per week. The employee may be rostered on to work on any day of the week, Monday to Saturday. Currently the usual business hours are from 8:00am until 5:00pm, Monday to Friday, and from 8:00am until 12:00pm Saturdays, with an expectation of working alternating Saturday's.”[3]
Reasonable private use of company issued motor vehicle
oMr Rouessart’s letter of offer of employment, dated 18 January 2023 provides under a heading of “Compensation and award” that he be provided with a “Fully Maintained Company Vehicle (*reasonable private use) with Fuel Card”.[4]
othe remuneration schedule to the unsigned “Employment Agreement” includes a similar provision: “Other: Fully Maintained Company Vehicle (*reasonable private use) with Fuel Fob”.[5]
oThose references each include an asterisk implying that there is some condition attached to the provision of the vehicle however none of the material before me sets out the nature of any such condition.
When he was dismissed on 11 December 2023, Mr Rouessart was provided with a termination letter which set out three reasons for his termination of employment;
1.Dishonesty to Ms Cornish the Group Manager, Strategic Projects in relation to his whereabouts on Wednesday, 29 November 2023;
2.In relation to the same date use of company time and resources to undertake personal errands;
3.Approval of an invoice for a customer Andrew Hudson, knowing the level of poor workmanship.
The letter also expressed disappointment that he was asked by Ms Cornish to make himself available during working hours to attend a meeting on the day of termination, but failed to do so, despite several attempts by the Respondent to call and text him.
Precipitating Mr Rouessart’s dismissal was a decision by him on 29 November 2023, while travelling back from Melbourne to Shepparton, to backtrack to Melbourne Airport so that he could drop off his son’s luggage which had been left in his company provided vehicle. Later that day he untruthfully said to Ms Cornish that he had had to return to the premises of the customer he had visited in the morning so that he could collect his laptop which had been left at the customer’s premises. He repeated that lie the following day and then only admitted the truth about the circumstances when confronted by Ms Cornish with questions on 8 December 2023.
North East Shepparton’s F3 Employer Response Form describes this as involving travel for unrelated work purposes of 286kms, taking “3 Hours, 48 minutes and 41 seconds, far beyond what any reasonable private use of a vehicle could be deemed as. This travel occurred between 12:07pm and 3:55pm, during the expected working hours”.[6]
The Respondent also points to Mr Rouessart being subject, from late November 2023, to a performance improvement plan which was about to be implemented. Mr Rouessart contests that he had been told he was to be subject to a performance improvement plan.
Before turning to matters associated with Mr Rouessart’s alleged misconduct, it is relevant to consider several other matters, largely taking place before 29 November 2023.
General employment issues
Commencing 2 October 2023 Mr Rouessart and his direct manager, Mr Crowhurst, the Dealer Principal travelled to New Zealand on a business trip. The Applicant considers he was inappropriately admonished by Mr Crowhurst on a boat in front of other people. He says he was pulled aside by Mr Crowhurst and spoken to in front of various industry colleagues who couldn’t help but hear the conversation due to the limited room. He accuses Mr Crowhurst of other inappropriate activities.[7] Mr Crowhurst accepts that the conversation was robust but does not accept that it was conducted in the way the Applicant describes, with the conversation taking place out of earshot of colleagues.[8]
On 10 November 2023, after arriving at work one and half hours late due to the troubled birth of a foal on his small farm, Mr Rouessart met with Mr Crowhurst who questioned his commitment to the business and the effect of the Applicant’s external business on his employment.[9]
On Sunday, 12 November 2023, Mr Rouessart responded to criticisms of his performance in an email.[10] This correspondence was in turn responded to by Mr Crowhurst on 13 November 2023.[11]
The concerns raised by Mr Rouessart in his 12 November 2023 email were to be the subject of a meeting with Mr Crowhurst and Ms Cornish on Thursday 29 November 2023.[12]
The Applicant’s email to Ms Cornish and Mr Crowhurst on 12 November 2023 records the criticisms made of his performance with the following headings;
New deals not being loaded into the system in a timely manner
Commitment to the business – my external business transactions affecting my performance
Training dates – not formalising time and dates with you
Contract report – sold not delivered, cleaning up report
Truck stock – knowing what stock
Phone calls – not returning calls in a timely manner. – Andrew Hudson and Gary from proplaster
Advertising – timeliness of stock going online, refers to him and Bailey
Tony and Suzanne are watching my movements closely.[13]
Foundations of the misconduct allegations
The meeting that was scheduled for 29 November 2023 did not take place. Mr Rouessart had advised several people at 7:23 AM, that he would be in Campbellfield that morning, after which he would return to the office. When Ms Cornish arrived in Shepparton for the meeting, she learned that Mr Rouessart was not there and had gone to meet with a customer.[14]
After Mr Rouessart finished with that customer, he started to return to Shepparton when his wife called and told him that he had his son’s bag in his car, with his son about to take a flight to Tasmania. Without telling anyone in North East Shepparton, he turned round, drove to Melbourne Airport and dropped off his son’s bag. He then restarted the journey to Sepparton.[SF1]
At about 1:40 PM, Ms Cornish called Mr Rouessart to enquire about his whereabouts. Mr Rouessart says that “When Suzanne rang to advise she was over for the meeting I panicked, as ever since the email I felt that I was in the firing line after her comments”.[15] Instead of telling the truth, Mr Rouessart told Cornish that he had needed to return to Melbourne as he had forgotten his laptop. Mr Rouessart says that statement was truthful to an extent, as he had in fact left his laptop in Melbourne earlier in the day. Mr Rouessart also told Ms Cornish that he did not think the meeting would be happening, as Mr Crowhurst was away.[16]
Ms Cornish’s evidence is that she told Mr Rouessart she did not cancel the meeting. Mr Rouessart responded by saying, “five minutes ago I realised I didn’t have my laptop and left it at the customer’s premises I had to turn around and go and get it”.[17]
After being told by the Applicant that he would be back in the office at about 4:30 PM, Ms Cornish advised him that she had an off-site meeting and suggested they catch up for dinner instead, as she was leaving the following day. That plan subsequently changed and Ms Cornish advised the Applicant she could now meet with him at 8 AM on Thursday 30 November 2023 instead. The Applicant agreed.[18]
In the 30 November 2023 meeting, Mr Rouessart maintained his story that he had returned to Melbourne to pick up his laptop, rather than telling Ms Cornish that he had gone to Melbourne Airport. Ms Cornish says she queried why the Applicant would attend the customer meeting in Melbourne the day before the end of the month and why he didn’t return to the office at 4:30 PM.[19]
During the meeting, Ms Cornish discussed the Applicant’s email response to Mr Crowhurst, as well as other performance concerns. Ms Cornish advised the Applicant that the Respondent would be putting him on a performance improvement plan, as the business was not performing to the expectations and the Applicant was responsible for performance of the sales department. She said that she would return to meet with him when Mr Crowhurst returned to the office and they would together commence the performance improvement plan process.[20] Mr Rouessart contests that he was told this, with his recollection being that he was told that, when Mr Crowhurst returned to the office, they would get together to discuss his email further.[21]
Ms Cornish says further that Mr Rouessart responded by saying that, being put on a performance improvement plan was embarrassing, being a manager and that the Respondent should not have reasons to put him on one. She says Mr Rouessart said in response that if he was going to go on a performance plan, then he should exit. Ms Cornish’s evidence is that she responded that she could not make that decision for him and rather, it needed to be something he decided for himself.[22] Mr Rouessart contests these things were said.
Ms Cornish says she reinforced to Mr Rouessart in their meeting that he needed to understand what was going on in his department and needed know what was happening with each truck in the yard.
Ms Cornish gave evidence that she said that from where she was sitting, “things are just not working” and there needs to be change, which included change in the relationship with Mr Crowhurst. Further, Mr Rouessart needed to get the department performing quickly and he needed to know and understand what was going on in his department. Ms Cornish says that she and the Applicant discussed his email response and then she advised him that she did not think it was appropriate and he should have spoken with Mr Crowhurst, to which the Applicant acknowledged his email response was not appropriate and that his relationship with Mr Crowhurst was not a good one.[23]
Ms Cornish gave further evidence that Mr Rouessart said he was disillusioned about the fact that salesperson salaries were not far behind design, to which she replied that the Respondent was not in a position to review his salary the way he and his department were performing. Ms Cornish says that she said to the Applicant that he needed to really think about whether this was going to work and her personal opinion was that there were too many things broken and she was not confident of his ability to turn things around. Ms Cornish says that Mr Rouessart acknowledged this and that he was going to go home talk to his wife and think about things.[24]
The meeting ended with Ms Cornish saying that she would be in touch with the Applicant when Mr Crowhurst returned.
Mr Rouessart contests that he acknowledged that his email to Ms Cornish and Mr Crowhurst was inappropriate, but accepts some parts of what Ms Cornish puts forward;
“I did not acknowledge that the email was inappropriate, nor did I say I was disillusioned by the salaries. I asked her, with the new hire of the salesman, Sam, coming on board at a high level wage, as well as two other sales staff, and also one of them being on an higher than average wage - this staff member Deane directly employed - how was it cost-effective for the department, and in conjunction with her statement of no coming back from this, I made comment, 'Should I start working on an exit plan?'”[25]
On Friday, 8 December 2023 at 11:55 AM, Mr Crowhurst emailed Mr Rouessart about the truck build for a customer (Andrew Hudson) saying the “build on this truck is a fucking disaster”.[26]
Also on Friday, 8 December 2023, Ms Cornish became aware of vehicle tracking information for Mr Rouessart’s company issued vehicle, which appeared to show that he had travelled to different places on 29 November 2023 than those which he had told her about. According to Ms Cornish’s evidence, this came about by accident: she had been in the company’s IT office and was shown information about a speeding vehicle, which turned out to be the one allocated to Mr Rouessart, as well as the information showing different locations on 29 November 2023 to those which he had told her about.[27] The information also suggested Mr Rouessart had stopped at a property some time near to his home, about which she was suspicious.
Ms Cornish consequently made a face time call to Mr Rouessart (the time of which is not stated). In the face time call, Ms Cornish asked Mr Rouessart about his whereabouts on 29 November 2023. In relation to his whereabouts, Mr Rouessart told Ms Cornish that he had gone to the airport with his son’s belongings. Mr Rouessart’s evidence is that Ms Cornish replied that her GPS tracking did not have him at the airport, but rather another property at which he had stopped.[28]
Ms Cornish says that, in the course of this call, the Applicant admitted he had dropped a parcel or something off at the airport. After further questioning, he changed his account and admitted he had dropped something to his son at the airport. Ms Cornish says that the Applicant then admitted his dishonest conduct. She advised him that this was serious and needed to be escalated to executive senior management.[29]
Ms Cornish said to the Applicant that he should not attend work on Monday, 11 December 2023. She also said that she would be in a meeting for most of the day and that he should make himself available later that afternoon and/or possibly after hours to receive a phone call and be available for a meeting.[30]
Later on Friday, 8 December, Ms Cornish rang the Applicant on his way home from work and informed him that all his access to the company’s business systems had been cut off, which he took as notification that he was being stood down. Ms Cornish also advised him not to attend the Christmas party which was to take place the following night, on Saturday 9 December.[31]
Mr Rouessart’s evidence is that, on the evening of Friday 8 December 2023, he suffered a medical episode which required him to first attend the hospital and then his own doctor on the Monday morning for a stress test, for which he was provided a medical certificate dated 11 December 2023. Mr Rouessart’s wife, Mrs Rouessart, provided the certificate to Mr Crowhurst by email on Monday, 11 December 2023 at 1:08 PM, in which she said that she and her husband would advise the Respondent if this was to become a WorkCover claim.[32] Mrs Rouessart sent the email to Mr Crowhurst, whom she understood had attended the Christmas party and returned to work.
Mr Rouessart was dismissed by an email sent to him one minute later, on Monday, 11 December 2023 at 1:09 PM. The termination letter set out the following;
“Dear Steven
RE: NOTICE OF TERMINATION
Further to your discussion on Friday, 8th December 2023 with Suzanne Cornish, Group Manager, Strategic Projects, this letter serves to provide you notice of the termination of your employment, with immediate effect without notice in accordance of Clause 19.1.1.(c) Engages in dishonest conduct or other gross misconduct (including but not limited to theft, fraud, assault, being intoxicated at work, refusing to carry out the Employer’s lawful and reasonable instructions that are consistent with the Employee’s employment and this Agreement.
This follows the recent dishonest conduct information that was discovered for the day on Wednesday 29th November 2023 where upon your own admission you were dishonest with Suzanne in relation to your whereabouts that day. In addition to this, you used Company time and resources (vehicle and fuel) to undertake personal errands and travel for over a four hour period not returning to the dealership that day. This occurring one day before end of month closing, a critical time for you to be present and around your staff making every attempt to finish off the month as strongly as possible.
In addition to this, the recent complaint I received from customer Andrew Hudson in relation to the quality of his truck body build and how you approved to pay the supplier knowing the level of poor workmanship; all without Deane Crowhurst or any other Manager being informed. We are now required to transport his truck to Adelaide, repair it to the level it should have been and transport it back to Shepparton; an extremely costly exercise. This also, in such a competitive business puts the company reputation at risk.
We are bitterly disappointed your employment is ending this way, however the relationship between you and the Executive Team, including owner Tony Emanuele is now untenable due to your dishonest conduct. As a senior manager you are trusted to act in a certain manner and to be honest and ethical in your dealings with both customers and staff. You have completely breached this level of trust.
What else is disappointing is you were asked by Suzanne Cornish to make yourself available during working hours today to attend a meeting and after several attempts in calling and texting your work mobile and personal mobile this morning, there has not been a response from you.
You will be required to return the company mobile phone, vehicle and laptop to the dealership tomorrow, being 12th December 2023 to Renee Nelson or Hermanus Reyneke in the absence of Deane Crowhurst no later than 5.00pm.
Your final termination payment will be processed 7 days following the return of all company property, assets and resources tomorrow.
Kind regards”[33] (bold text in original)
The termination letter was signed by Michelle Papalia, Group General Manager who did not give evidence in these proceedings.
After the dismissal on Monday, 11 December 2023, at 6:35 PM, Mrs Rouessart sent a long email to Ms Cornish disputing the dismissal.[34]
LEGISLATION
The legislative provisions relevant to this matter are set out in s.387 of the Act, which is as follows:
“387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that the FWC considers relevant.”
Determination of whether the Applicant’s dismissal was harsh, unjust or unreasonable requires each of the matters specified in s.387 to be taken into account. The Full Bench has summarised the approach that should be taken by the Commission when considering the criteria within s.387 in the following way:[35]
“[28] The following propositions concerning consideration as to whether there is a valid reason for dismissal for the purpose of s.387 are well established:
· a valid reason is one which is sound, defensible and well-founded, and not capricious, fanciful, spiteful or prejudiced;[36]
· a reason would be valid because the conduct occurred and justified termination; conversely the reason might not be valid because the conduct did not occur or it did occur but did not justify termination (because, for example, it involved a trivial misdemeanour);[37]
· it is not necessary to demonstrate “serious misconduct” or misconduct sufficiently serious to justify summary dismissal in order to establish a valid reason for dismissal;[38]
· the existence of a valid reason to dismiss is not assessed by reference to a legal right to dismiss[39] (so that, for example, where summary dismissal has occurred, it is not necessary to determine whether the right of summary dismissal was legally available); and
· the criterion for a valid reason is not whether serious misconduct as defined in reg.1.07 has occurred, since reg.1.07 has no application to s.387(a) (although a finding that misconduct of the type described might well ground a conclusion that there is a valid reason for dismissal based on the employee’s conduct).”[40] (original references)
In cases where the reason for termination is based on misconduct, the Commission must determine whether the alleged conduct took place and what it involved.[41]
WAS MR ROUESSART UNFAIRLY DISMISSED?
So far as it is relevant to the circumstances of this case, a dismissal is unfair, in the case of a person protected from unfair dismissal, when that person is dismissed in a manner that was harsh unjust or unreasonable, taking into account the criteria within s.387. I will deal with each of the criteria within s.387 in turn.
(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)
Valid reason – general principles
To be a valid reason, the reason must be “… sound, defensible or well-founded.” A reason which is “… capricious, fanciful, spiteful or prejudiced …” cannot be a valid reason.[42] The reason for termination must be defensible or justifiable on an objective analysis of the relevant facts.[43] The valid reason for termination is not to be judged by legal entitlement to terminate an employee, “… but [by] the existence of a reason for the exercise of that right” related to the facts of the matter.[44] Ascertainment of a valid reason involves a consideration of the overall context of the “practical sphere” of the employment relationship.[45]
“Capacity”
Mr Rouessart was not dismissed for reasons of capacity, but instead because of misconduct.
“Conduct”
Where an employee has been dismissed without notice (summary dismissal) for serious misconduct, the Commission may find that, although there was a valid reason for the dismissal, the dismissal was harsh because summary dismissal was a disproportionate response. Where the conduct involves serious misconduct, the principle established in Briginshaw v Briginshaw[46] may be relevant. While an “elevated standard”,[47] the standard of proof remains the balance of probabilities but “the nature of the issue necessarily affects the process by which reasonable satisfaction is attained” and such satisfaction “should not be produced by inexact proofs, indefinite testimony, or indirect inferences” or “by slender and exiguous proofs or circumstances pointing with a wavering finger to an affirmative conclusion”.[48]
It is not the Commission’s role to “stand in the shoes of the employer and determine whether or not the decision made by the employer was a decision that would be made by the court.”[49] However, the Commission “must consider the entire factual matrix in determining whether an employee’s termination was for a valid reason.”[50]
For there to be a valid reason for the dismissal, related to the Applicant’s conduct, it must be found that the conduct actually occurred, as a necessary step in the process of determining whether a valid reason for dismissal existed.[51] Further, “[t]he question of whether the alleged conduct took place and what it involved is to be determined by the Commission on the basis of the evidence in the proceedings before it. The test is not whether the employer believed, on reasonable grounds after sufficient enquiry, that the employee was guilty of the conduct which resulted in termination.”[52]
It has been said by the Full Bench, with reference to the definition of “serious misconduct” within the Fair Work Regulations 2009, that “the criterion for a valid reason is not whether serious misconduct as defined in reg.1.07 has occurred, since reg.1.07 has no application to s.387(a) (although a finding that misconduct of the type described might well ground a conclusion that there is a valid reason for dismissal based on the employee’s conduct).”[53] The Full Bench has also found there is not a “clear rule of law defining the degree of misconduct justifying summary dismissal”,[54] and that it “is certainly well established that, for the purposes of s.387(a), it is not necessary to demonstrate misconduct sufficiently serious to justify summary dismissal on the part of the employee in order to demonstrate that there was a valid reason for the employee’s dismissal (although established misconduct of this nature would undoubtedly be sufficient to constitute a valid reason).”[55]
The Commission, when determining whether there was a valid reason for dismissal, must assess whether the conduct was of sufficient gravity or seriousness such as to justify dismissal as a sound, defensible or well-founded response to the conduct.[56] In its assessment of whether there was a valid reason for dismissal, the Commission is not limited to the reason relied on by the employer for dismissing the employee.
Serious misconduct
Regulation 1.07 of the Fair Work Regulations 2009 provides:
“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 subregulation (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.
(5) For paragraph (3)(b), an employee is taken to be intoxicated if the employee’s faculties are, by reason of the employee being under the influence of intoxicating liquor or a drug (except a drug administered by, or taken in accordance with the directions of, a person lawfully authorised to administer the drug), so impaired that the employee is unfit to be entrusted with the employee’s duties or with any duty that the employee may be called upon to perform.”[57]
The matter of misconduct is also dealt with in the unsigned Employment Contract provided in the Respondent’s documents. So far as is relevant, the document provides the following in relation to termination of employment without notice;
“c) Engages in dishonest conduct or other gross misconduct (including but not limited to theft, fraud, assault, being intoxicated at work, refusing to carry out the Employer’s lawful and reasonable instructions that are consistent with the Employee’s employment and this Agreement); or
d) Wilful or deliberate behaviour that is inconsistent with the continuation of the Employee’s employment contract;”[58]
The termination letter from North East Shepparton set out three grounds for dismissal, each regarded as serious misconduct;
1.Dishonesty to Suzanne Cornish the Group Manager, Strategic Projects in relation to his whereabouts on Wednesday, 29 November 2023;
2.In relation to the same date use of company time and resources to undertake personal errands;
3.Approval of an invoice for a customer Andrew Hudson, knowing the level of poor workmanship;
Dishonesty
During November, there had been criticism of the Applicant’s performance, particularly in a conversation between him and the North East Shepparton’s Dealer Principal, Deane Crowhurst, on 10 November 2023. Mr Rouessart had a small farm in addition to being employed and that day had a foaling horse, which caused him to be late for work. That event led to Mr Crowhurst speaking to him about his employment and what was expected of him. Mr Rouessart says that Mr Crowhurst was aggressive to him and that, “Over the next few days Deane was abrupt and rude to me.[59] Mr Rouessart responded to Mr Crowhurst’s commentary to him in writing, somewhat robustly, on Sunday, 12 November 2023 and Mr Crowhurst responded on Monday, 13 November 2023 firmly, but not as robustly. Mr Rouessart later spoke with Suzanne Cornish, who advised that he “should not have sent the email and that there was probably no coming back from this”.[60] A meeting was planned for 16 November 2023, however it did not proceed, owing to a family emergency for Mr Crowhurst and was rescheduled for Wednesday, 29 November 2023, when Ms Cornish would be in Shepparton. By that date, Mr Crowhurst’s family circumstances had not resolved, and he was not able to attend the scheduled meeting.
The Wednesday, 29 November 2023 meeting also did not take place, as Mr Rouessart was himself unavailable, with Ms Cornish setting out in her witness statement how she learned of that circumstance;
“Suzanne arrived in Shepparton for the meeting that morning and was advised the Applicant was offsite on a customer visit.
Suzanne spoke with Renee Nelson, who advised she had been informed the Applicant was expected back in the office around 2pm.
Suzanne called Steven at around 1.40pm that day to ask him where he was as she was here for the meeting.
The Applicant advised he didn’t think the meeting would be happening as Deane was away. Suzanne advised the Applicant she didn’t cancel the meeting.
The Applicant advised during the call that “5 mins ago I realized I didn’t have my laptop and left it at the customer’s premises so had to turn around and go and get it”.”[61]
The two agreed that they would meet over dinner later that evening to have the scheduled discussion. As it turned out, that discussion did not occur on 29 November 2023, as Ms Cornish had a higher priority engagement that needed to be undertaken instead.
The two then met the following day at about 8 AM, with Ms Cornish giving this evidence about the discussion which then ensued;
· “At the commencement of the meeting, the Applicant apologised for not being able to be at the meeting the day prior and thought it was not happening. Suzanne advised she didn’t cancel it, and he agreed he should have checked with her before he made the customer meeting. The Applicant said the meeting was still in his calendar, but he dismissed it. Suzanne said it was very disappointing that he was not at the meeting given she specifically flew over for it and he should not have dismissed this type of meeting with an Executive Manager. The Applicant apologised again to Suzanne.
· Suzanne stated how annoying it would have been for him to have to go back all that way to retrieve his laptop. He said he only noticed it was missing when he was almost back to the office and had to turn around and get it.
· Suzanne said she didn’t understand why he would attend a customer meeting in Melbourne the day before end of month – he should have been here on site trying to finish off the month and be with his staff to finish off the month strongly. Also with Deane being away, more reason to be on site to support the staff.
· Suzanne asked the Applicant why he didn’t return to the office at 4.30pm again, reiterating end of month, sorting his staff out etc. The Applicant advised he didn’t think he needed to and went home.”[62]
At the conclusion of the meeting, Ms Cornish told Mr Rouessart that North East Shepparton would be putting him on a performance management plan as the business was not performing to the expectations and he is responsible for the performance of the Sales Department and that once Mr Crowhurst return from leave there would be a discussion about commencement of the performance management plan. Ms Cornish then says in her statement;
“During this meeting the Applicant advised that being a manager and being on a Performance Improvement Plan was embarrassing and we shouldn’t have reasons to put him on one. The Applicant acknowledged the Company did have good reasons and agreed a performance improvement plan would be a good idea however in the next breath said he will work on exiting the business. Suzanne advised the Applicant we are not asking him to exit the business, but we need to work on the performance of the department and his individual performance. The Applicant said if he was going to go on a performance plan then he should exit.
Suzanne said she can’t make that decision for the Applicant, that needs to be something he decides for himself.”[63]
Mr Rouessart contests he was told he was to be put on a performance improvement plan, or that he might as a consequence exit the business, giving these answers in cross-examination from Mr Pollitt for North East Shepparton;
“Okay. Thank you. Just turning back to the meeting with Ms Cornish on 30 November, she says that she advised you that she would be putting you on a performance management plan, as the business was not performing to the expectations, and you were responsible for performance of the sales department. Do you recall her saying that to you?‑‑‑No, I don't recall that part of the conversation.
Do you recall her saying that she would be putting you on a performance improvement plan?‑‑‑No, I don't.
It then says that she would return to meet with you when Mr Crowhurst returned to the office, and together they would commence a performance improvement plan process. Again do you recall that being said to you?‑‑‑I remember her saying, when Deane returns to the office, we will – we can then get together and discuss the email further, that I sent through.
She says that you then said:
Being put on a performance improvement plan was embarrassing being a manager -
And that the respondent shouldn't have reasons to put you on one.
Do you recall having said that?‑‑‑No, I wouldn't have put 'embarrassed', I never use the word 'embarrassing' in that – in those sort of contents ‑ ‑ ‑
Did you otherwise say anything which would say, 'That's concerning to me, I don't want that to occur'?‑‑‑Not that I can recall, from the contents.
Her evidence is that you acknowledge that the respondent did have good reasons, and you agreed that a performance improvement plan would be a good idea, but you will then work on exiting the business. Do you recall saying either of those things?‑‑‑No, the exiting of the business, I'll go on to that in a moment. The – if you can just repeat the first part, without the exiting of the business. Sorry, I didn't write all of it down.
Just one moment. Her evidence is that you acknowledge the company did have good reasons, and agreed a performance improvement plan would be a good idea. So did you say that?‑‑‑No, not to that exact words. The words were agreeing if I – if I'm not in – if I'm not in – if I need improvement in certain areas, I'm happy to improve on those areas.
And then she says that you said you will work on exiting the business?‑‑‑No, I didn't say I'd work on exiting the business. If the business no longer wants me within the business, does she want me to work on an exit plan with the business. And there she said, 'No', she cannot inform me to do that. So that was the only context that that was used in, because she said she could not stipulate that.”[64]
Mr Rouessart accepts that his initial statement to Ms Cornish, that he had left his laptop at a customer’s premises, was not truthful, with him putting forward in his own material this explanation;
“On the day of the 29th I was returning to work when I received a call from my Son who was on his way from Bendigo going to the airport as he had been visiting from Tasmania, the original plan was that I was going to drop him at the airport in the morning whilst I was in Melbourne so I had his belongings in my vehicle, however the plans had changed and he did not return to our house from Bendigo that evening due to poor weather, I forgot I had his bag. I made the decision to turn around near Nagambie and drive back to the airport to drop off his bag. When Suzanne rang to advise she was over for the meeting I panicked, as ever since the email I felt that I was in the firing line after her comments. So instead of the truth I said I had to return to Melbourne as I had forgot my laptop, this had in fact happened earlier in the day but I did stretch the truth.”[65]
However, Mr Rousseart did not give this explanation to Ms Cornish until 8 December 2023, and then only when she queried him about the subject.
North East Shepparton, along with other parts of the North East Group, routinely tracks its vehicles with electronic devices, having more than 600 across its fleet of vehicles and equipment. Ms Cornish learned on 8 December 2023 that Mr Rouessart’s vehicle had been involved in speeding on 29 November 2023. She later formed the view that the timing of the speeding event suggested his explanation may not be accurate;
“… it was determined the Applicant did go back to the customer to get his laptop but he did this some time between 10.50am and 10.59 in the morning, not at approx. 1.40pm when Suzanne had called him.
After the Applicant retrieved his laptop it appears he was on his way back to Shepparton and got to a BP Service Station at Wallan then turned around and went to back to Melbourne to the airport – this was a near 4 hour round trip.
The Applicant arrived in Shepparton at 4.52pm but decided not to return to the office and go home at 4.52pm.
Suzanne then called the Applicant on 8 December 2023 to get clarification on his whereabouts on 29 November 2023.
The Applicant admitted during this call he had to drop a parcel or something off at the airport; Suzanne questioned this further, and the Applicant then changed his recount and admitted he was dropping something to his son at the airport that his son left in the back seat of his car.
The Applicant then admitted his own dishonest conduct.
Suzanne advised the Applicant due to him lying and being dishonest, this was serious and needed to be escalated to Executive Senior Management”.[66]
In his oral evidence, Mr Rouessart denied that he had picked up his son from another vehicle and then taken him to the airport.[67] Mr Rouessart explained that his son’s bag had been left in his vehicle the day before.[68] After visiting the customer near Melbourne, Mr Rouessart’s wife had called and told him that he had his son’s bag in his car. Mr Rouessart then says;
“And she's asked me to basically, you know, put one in for the family and, 'If you can drop that off at the airport there', because she's already dropped Jacob off at the airport, and continued on to the client where she was going. So I made that decision to then return to the airport to drop that off to Jacob. So he was waiting at the – at the drop-off for me, because it was the easiest way in there, and less impact of having to stop a car and try and find parking and that, so I advised him to meet me at the drop-off point. I then dropped off the baggage to him, and continued on my way back.”[69]
Ms Cornish says in her evidence that after arriving at Shepparton on 29 November 2023 and finding that Mr Rouessart was not there, she rang him at about 1:40 PM to ask where he was. He told her two things of significance; that he had assumed the meeting would not be happening as Mr Crowhurst was not in Shepparton and that he had been required to return to his customer, to collect his laptop which had been left there. Less significantly, he also told Ms Cornish that he would be back in the office at 4:30 PM, although she deflected having a meeting at that time. Then, despite having said he would return to work at 4:30 PM, Mr Rouessart instead returned home.
There is no question, on the material before the Commission, that Mr Rouessart took very seriously the counselling that had been provided to him by Mr Crowhurst earlier in the month of November and that, even though he objected to much of its nature, he understood only too well the significance of what had been said to him. Formation of the view that an arranged meeting, for the purposes of further counselling on 29 November 2023 would not take place, simply because Mr Crowhurst was not presently at work, is at least questionable as well as being a very poor judgement. There had been no attempt by Mr Rouessart to check with Ms Cornish in the days before 29 November 2023 as to whether she still expected the meeting to take place.
I am satisfied that the first part of the conduct complained of actually occurred; namely that Mr Rouessart was deliberately dishonest to Ms Cornish about his whereabouts on 29 November 2023. He was dishonest about this subject on Wednesday, 29 November 2023 and then again on Thursday 30 November 2023. He did not admit to this dishonesty until the conversation between Ms Cornish and Mr Rouessart on Friday, 8 December 2023, when Ms Cornish challenged him about the subject.
Mr Rouessart claims a number of factors held him back from honesty to Ms Cornish, including that earlier events caused him to believe he could not be open and honest with his employer in relation to his personal life.[70]
I am satisfied that Mr Rouessart was dishonest to Ms Cornish on two separate occasions and that he would not have disclosed the truth about his travel on 29 November 2023 if he had not been confronted about the matter by Ms Cornish on 8 December 2023.
Misuse of company resources and time
This allegation is in two parts. First is the allegation that Mr Rouessart undertook unauthorised travel in his company vehicle when he returned to Melbourne Airport on 29 November 2023. Second is the allegation that, by undertaking a round-trip back to Melbourne Airport, which North East Shepparton estimates is a four hour round trip, Mr Rouessart made himself unavailable for work despite being paid for that time.
The first element of the resource misuse complaint is that Mr Rouessart used company resources to undertake a personal trip to the Melbourne Airport. The facts before me establish that Mr Rouessart did this, with there being no contest from him on the subject.
The second part of the resource misuse complaint is that Mr Rouessart made himself unavailable when he returned to the airport which, on the Respondent’s view, extended the trip by four hours. It is established that Mr Rouessart used the vehicle issued to him by the Respondent to undertake this trip. However, it is not established that the total additional time taken to undertake the trip back to Melbourne Airport was four hours, as asserted by North East Shepparton. This element appears overstated, as Mr Rouessart was only part way through his return journey when he made the decision to backtrack and would still have had a substantial amount of time to return to Shepparton, if the journey had not been interrupted by the additional trip to the airport. Precisely where Mr Rouessart turned around is unclear in the evidence: he puts the turnaround point as Nagambie, whereas Ms Cornish puts it at Wallan.[71]
Beyond the strictly factual elements, the more important question associated with the resource misuse complaint is whether a finding can be made that the trip or the use of the company issued motor vehicle was not authorised or contrary to policy and thereby misconduct.
Whereas the Respondent put forward on multiple occasions in the presentation of its case, that Mr Rouessart’s use of the motor vehicle to return to Melbourne Airport on 29 November 2023 was contrary to policy, it has not satisfactorily addressed in these proceedings what its policy may be, or even if there is one. Mr Crowhurst’s evidence was that he was not aware of there being any dedicated company vehicle policy for automotive sales Victoria, and that he never discussed with Mr Rouessart the reasonable use of his motor vehicle.[72]
A statement in an offer of employment letter that an employee may have the “reasonable private use” of a company vehicle, is to be taken as just that, in the absence of widely known policy which limited the undertaking in some way. No such policy is before me.
Accordingly, reasonable private use in the context of Mr Rouessart must mean the ability to use the vehicle for performance of private and personal needs in some way, unconnected with its use for business purposes, as if it was Mr Rouessart’s own vehicle. Taking into account these matters, as well as that Mr Rouessart and others employed by North East Shepparton are located in country areas and likely have both business and personal reasons to travel to Melbourne or other distant locations, a finding that the use of the vehicle by Mr Rouessart to return to Melbourne Airport for the purposes described was not “reasonable private use” and thereby permitted of him is not reasonably open to me.
I also take into account that Mr Rouessart’s evidence on the day in question was that he had first travelled from Shepparton to a client in Campbellfield, in the northern suburbs of metropolitan Melbourne and was travelling back to Shepparton when he made the decision to return to Melbourne Airport.
I find therefore the use of the Respondent’s vehicle for the purpose of returning to Melbourne Airport for private reasons, was reasonable private use and not conduct of the type alleged, namely an unauthorised use of the vehicle and fuel to undertake personal errands and travel.
I am also not satisfied that the misuse of the time component of the allegation is made out. Aside from the contractual issues referred to above Mr Rouessart plainly had access to flexibility with his working hours to some degree at least, being able to plan his working day and week according to particular needs. In this respect, the email Mr Rouessart sent to a number of people on the morning of 29 November 2023, explaining that he would be in Campbellfield that day visiting a customer, confirms the flexibility. Rather than seeking permission or something of that nature, the email simply says that that is what he planned to do. Both the offer of employment letter and the unsigned employment agreement state the ordinary hours of work are to commence at 8 AM. The unsigned employment contract says that the employee is required to work a minimum of 38 hours per week and that the “usual business hours” are from 8 AM. The vehicle tracking information relied upon by North East Shepparton shows that Mr Rouessart commenced his journey on 29 November 2023 at 7:32 AM, however no complaint is made by either party that this was improper.[73]
The Respondent also complains that the additional journey taken by Mr Rouessart back to Melbourne airport added four hours to the overall journey. That is not established in the evidence before me, and such evidence as is before me would suggest that the period of time taken to return to the airport and then back to where the deviation started was substantially less than complained of by the Respondent.
For the reasons stated, while I find Mr Rouessart used his company issued vehicle to return to Melbourne Airport and took time in working hours to do so, I do not find either element of conduct to be unauthorised and thereby open to a finding of misconduct.
Approval of the Hudson invoice
This allegation pertains to work which had been undertaken by North East Shepparton on a vehicle owned by Mr Hudson. The work came to an end and Mr Rouessart then, it is alleged, released the vehicle to Mr Hudson and issued an invoice for the work undertaken in relation to the vehicle. It has been alleged that Mr Rouessart knew both that the remedial work on the truck was not to the standards required by the customer and that he then issued an invoice to Mr Hudson, knowing that the invoice was overstated and would have to be recast at a later time.
Ms Papalia, in the termination letter, characterises the issue as a matter pertaining to;
“the recent complaint I received from customer Andrew Hudson in relation to the quality of his truck body build and how you approved to pay the supplier knowing the level of poor workmanship; all without Deane Crowhurst or any other Manager being informed” (underlining added)[74]
The Respondent’s case on the matter is set out briefly in its outline of submissions in a section dealing with poor work performance;
“3. The build quality was well below what was considered satisfactory. The Applicant made no attempt to stop payment to the Body Builder after inspecting the product and acknowledging the poor quality. By the Applicants own admission the quality was not of an acceptable level.
4. The Applicant was aware of the process on payment of invoices after approx. 11 Months in the role and did not intervene in the payment being actioned”[75]
The invoice itself, or documentation relating to its approval is not in evidence before me.
Mr Rouessart denied authorising the invoice.[76] The absence of the invoice itself or other evidence that Mr Rouessart actually approved the invoice to be issued, as well as cross-examination about his state of knowledge at the time it was issued means the conduct alleged by North East Shepparton in its termination letter is not substantiated.
Whether a valid reason
The conduct found to have actually occurred, and open to a finding of misconduct, is that Mr Rouessart was untruthful to Ms Cornish on two occasions over his whereabouts on 29 November 2023.
Having made these findings about Mr Rouessart’s conduct, the question then turns to whether the Respondent had a valid reason for dismissing him.
The single point of misconduct occurred on two separate occasions, when Mr Rouessart lied to Ms Cornish about his travel on 29 November 2023. The nature of those lies were that part way through his return journey he had to return to the customer’s premises to pick up a laptop. The evidence does not support that in putting this to Ms Cornish he also downplayed the length of time that part of the journey took.
Mr Rouessart’s untruths were to his employer and upon discovery, impacted only their relationship. That is, Mr Rouessart was not untruthful to customers or others and the consequence of what he said was confined to the employment relationship. He did not bring his employer into disrepute either generally or publicly or with other employees. While repeated over two days, the deception of Ms Cornish was to prevent her from having a further reason to criticise Mr Rouessart or his performance, but was not to deflect her from greater matters, such as might be if the deception related to an assault, a fraud or the destruction of company property.
The circumstances do not allow a finding that the Applicant’s conduct was inconsistent with the continuation of the contract of employment, being a consideration of both the meaning of serious misconduct within regulation 1.07 and the terms of the unsigned employment contract. I am not persuaded from the evidence before me that Mr Rouessart’s conduct, either in respect of those considerations or otherwise, was serious misconduct.
In the circumstances, I am not satisfied that the Respondent held, at the time it dismissed Mr Rouessart, a valid reason for his dismissal.
(b) whether the person was notified of that reason
It is well established that the consideration of s.387(b) is directed to whether or not the dismissed person was notified of the valid reason for their termination, before the decision to dismiss them was made, with it being expected that the notification of the valid reason is in explicit terms.
At no time prior to receipt of the matter of termination was Mr Rouessart aware that his dismissal was being contemplated by North East Shepparton.
Mr Rouessart was notified of his dismissal by letter, dated 11 December 2023. The dismissal took immediate effect. The letter comprehensively set out the reasons relied upon by North East Shepparton for his termination.
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person
For the Commission to have regard to whether an employee has been given an opportunity to respond to the reason for dismissal, there needs to be a finding that there is a valid reason for dismissal.[77] While so, it is also accepted that “an opportunity to respond” amounts to an opportunity to provide reasoning to a decision maker that would, all things being equal, allow a reasoned explanation to cause the decision maker to accept what is proffered and to change from their foreshadowed path.[78]
A provision in predecessor legislation, requiring there not be dismissal until “the employee has been given an opportunity to defend himself or herself against the allegations made”, has been held to be a requirement not needing any particular formality, being “intended to be applied in a practical, common sense way so as to ensure that the affected employee is treated fairly.[79] Where the employee is aware of the precise nature of the employer’s concern about his or her conduct or performance and has a full opportunity to respond to this concern, this is enough to satisfy the requirements of the section”.[80]
The evidence shows that Mr Rouessart had a conversation with Ms Cornish on Friday, 8 December 2023 and, in the course of the conversation, made admissions about his whereabouts on 29 November 2023. After being asked about the vehicle tracking information, he voluntarily made those admissions, and did not have to be dragged into making them.
Following the discussion with Ms Cornish on Friday, 8 December 2023, Mr Rouessart was stood down and told to remove himself from the workplace and to not attend either the end of year dinner, due to take place the following evening, or work on Monday, 11 December 2023. He was also told to “ensure he remain available to receive a phone call and be available for a meeting” on Monday, 11 December 2023.[81] Despite this, Mr Rouessart left his company issued laptop and phone in the vehicle issued to him.
At no stage was Mr Rouessart told that his termination of employment was contemplated, or the reason that would be relied upon by North East Shepparton for dismissal.
While the Respondent is critical of Mr Rouessart for not being available when Ms Cornish tried to call him on Monday, 11 December 2023, nothing within the evidence about that day would suggest that North East Shepparton or Ms Cornish sought to have a discussion or have a meeting with Mr Rouessart for the purposes of giving him an opportunity to respond to the reasons it considered termination of employment was appropriate. Ms Cornish made some phone calls to Mr Rouessart in the morning of that day, without success, and then sent a termination letter to him at 1:09 PM.[82] I also take into account that Mr Rouessart’s health changed significantly over the weekend. While the Respondent was not to know of this, it explains to a degree why Mr Rouessart was not available as directed on 11 December 2023.
Instead of moving to dismiss Mr Rouessart when it could not get hold of him on 11 December 2023, the Respondent should have waited until he was available, sought an explanation from him, as well as a response to the reasons it considered he should be dismissed, and then made a reasoned decision about the continuation of employment.
(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
As there were no discussions held with Mr Rouessart relating to his dismissal, this is a neutral consideration in my decision.
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal
Mr Rouessart was not dismissed for reason of unsatisfactory work performance. Accordingly, consideration of this criterion is a neutral factor in my decision.
(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
There is no direct evidence before me on the subject of whether North East Shepparton’s size likely impacted on the procedures it followed in effecting the dismissal. Accordingly, this is a neutral consideration in my determination of whether Mr Rouessart’s dismissal was an unfair dismissal.
(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
There is no evidence before the Commission that there may have been an absence of dedicated human resource management specialists or expertise in the Respondent. To the contrary, the Respondent appears to have been assisted in its decision-making through its internal human resource management staff. Even so, consideration of this criterion is a neutral factor in my decision.
(h) any other matters that the FWC considers relevant
It is necessary for the Commission to undertake a weighing process in relation to its ultimate finding as to whether a dismissal was harsh, unjust or unreasonable, with the Full Bench in B, C and D v Australian Postal Corporation T/A Australia Post finding;
“[58] Reaching an overall determination of whether a given dismissal was “harsh, unjust or unreasonable” notwithstanding the existence of a “valid reason” involves a weighing process. The Commission is required to consider all of the circumstances of the case, having particular regard to the matters specified in s.387, and then weigh:
(i) the gravity of the misconduct and other circumstances weighing in favour of the dismissal not being harsh, unjust or unreasonable;
against
(ii) the mitigating circumstances and other relevant matters that may properly be brought to account as weighing against a finding that dismissal was a fair and proportionate response to the particular misconduct.
[59] It is in that weighing that the Commission gives effect to a ‘fair go all round’.”[83]
As set out above in relation to s.387(a), I have not found that there was a valid reason for Mr Rouessart’s termination of employment. Assessment of his overall misconduct is that it is, on the evidence before me, insufficient to be characterised as serious misconduct. That being said I would relevantly take into account for the purposes of s.387(h) that the misconduct is at the lower end of the scale, for the reasons set out above. With that in mind, a decision to dismiss was disproportionate to the level of misconduct actually found.
I also take into account that, even though the misconduct was not found to be serious misconduct, Mr Rouessart’s conduct is still unambiguously misconduct and he cannot have expected, had it been discovered, as it was, that there would be no repercussions. In my view, this is especially so, given that from at least mid November 2023, it was known to him that his immediate manager, Mr Crowhurst, held significant reservations about his work performance.
Finally, I take into account that, at the time of the termination of his employment, Mr Rouessart had been employed only for a short period, of about 10 ½ months, and was in discussions with his managers about his work performance.
While the weight of these elements leans toward a finding of unfair dismissal, the commencement of a performance management process would have been justified on the part of North East Shepparton.
I do not find there were any other matters of relevance requiring consideration.
CONCLUSION
Conclusion on the s.387 criteria
After considering each of the criteria within s.387, I am not satisfied there was a valid reason for North East Shepparton’s dismissal of Mr Rouessart. I am also of the view that his dismissal was procedurally unfair, as the reasons held by the Respondent for his dismissal were neither put to him before he was dismissed, nor was he given an opportunity to respond to those reasons.
The Act requires the Commission to consider whether a dismissal was harsh, unjust or unreasonable by taking into account the matters at ss.387 (a) to (h). The meaning of the term “harsh, unjust or unreasonable” was considered by the High Court in the matter of Byrne and Frew v Australian Airlines Limited:
“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.”[84]
It has been further held that a dismissal may be unjust, because the employee was not guilty of the misconduct on which the employer acted; unreasonable, because it was decided on inferences which could not reasonably have been drawn from the material before the employer; and/or harsh, because of its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct.[85]
I find that Mr Rouessart’s dismissal was harsh and unjust. It was harsh since the penalty of dismissal was disproportionate to his misconduct and unjust since he was not given an opportunity to respond to the Respondent’s conclusion that he should be dismissed.
Accordingly, I find that Mr Rouessart’s dismissal was an unfair dismissal.
REMEDY
The sections of the Act dealing with remedy once a finding of unfair dismissal has been made are set out in ss.390 – 393.
Pursuant to sub-s.390(3), an order for the payment of compensation to a person must not be made unless the Commission “is satisfied that reinstatement of a person is inappropriate” and also that the Commission “considers an order for payment of compensation is appropriate in all the circumstances of the case.”
Mr Rouessart does not seek reinstatement from his application. North East Shepparton also argue against reinstatement for several reasons, arguing that reinstatement in any capacity would not be appropriate as well as there being a breach of trust arising from Mr Rouessart’s actions. The Respondent also argues that reinstatement would be inappropriate for a person holding a senior management position in which the requirements of trust and professionalism had been breached. The Respondent also argues that Mr Rouessart’s “conduct during their employment is still having significant and long- lasting financial impacts on the Company along with damaged relationships with key customers”, despite there being no evidence capable of acceptance before the Commission on this contention.
After reviewing the evidence and other material before the commission, I concur that in this case reinstatement would be inappropriate.
Compensation – what must be taken into account in determining an amount?
Having determined that reinstatement is inappropriate, compensation may only be ordered if the Commission considers an order for payment of compensation is appropriate in the circumstances of the case (s.390(3)(b)). That is, an order for compensation is not automatic if reinstatement is found to be inappropriate, and is instead a discretion to be exercised, subject to certain further consideration. In this regard, s.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 below.
Effect of the order on the viability of the Respondent’s enterprise
There is no evidence before me about the effect of an order for compensation on the viability of the employer’s enterprise.
Length of the Applicant’s service
Mr Rouessart’s length of service with the Respondent was short, having been employed on 23 January 2023 and dismissed with effect on 11 December 2023 a period of about two weeks more than 10 months.
Remuneration that the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed
Assessment of the remuneration an Applicant would have received, had it not been for their dismissal is both an essential and difficult task.
As stated by a majority of the Full Court of the Federal Court, “[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.”[86]
I consider that it is likely that, had Mr Rouessart not been dismissed on 11 December 2023, his employment with North East Shepparton would not have continued for very long. In this respect there are three relevant issues.
First is the Respondent’s contention that Mr Rouessart was placed on a performance management plan on 30 November 2023, against his wishes, with Ms Cornish saying to him that the process would commence once Mr Crowhurst had returned from leave.
Second is that, Ms Cornish’s evidence is that Mr Rouessart said about the performance process that he was embarrassed it commenced and that, on Ms Cornish’s evidence, Mr Rouessart “said if he was going to go on a performance plan then he should exit.”[87] Mr Rouessart contests either that he was told he was about to be put onto a performance plan or that he had responded by saying that if such happened he should exit. Instead, he puts forward that he said something to the effect of “Do we need to work on an exit plan if the business doesn't want me anymore?”[88]
I consider that, at the least, it was made clear to Mr Rouessart by Ms Cornish that his performance was wanting and that, from that point forward, it would be closely monitored. On Mr Rouessart’s evidence, he denied having said that he might exit, but he does agree that exiting the business had been discussed in some way, albeit more neutrally than Ms Cornish characterises the conversation. I consider it highly unlikely in the situation described that Mr Rouessart would not commence an active job search for other employment following both the performance discussion as well as having been found to be untruthful on two occasions to his employer.
Third, I take into account that Mr Rouessart had been untruthful to Ms Cornish on two occasions which had been discovered by her. While not presenting a valid reason for Mr Rouessart’s termination of employment, the situation at least would warrant disciplinary action with sanctions against him, which may well include the provision of a first and final warning in writing to the effect that repetition of any kind would lead to his dismissal.
The tone of the conversations and communications between Mr Rouessart and Mr Crowhurst as well as Ms Cornish are such that a termination of employment, on the basis of the performance concerns which had been put to him was also likely at some stage in the early New Year. To the extent that the concerns held by North East Shepparton about the Hudson invoice were real, Mr Rouessart’s exit from the business would likely be sooner rather than later.
These matters in my view lead to a situation in which Mr Rouessart’s anticipated period of employment would be very low, likely numbered only in weeks. Given the time of the year, mid-December, if Mr Rouessart took the view that he needed to leave the Respondent’s employment, it could be expected that he would start a job search as soon as possible in the New Year. It cannot be ruled out from the evidence in total that he may well have decided to leave without another job to go to and then take his chances in obtaining other employment.
Subject to the levelling up consideration required of me in application of the Sprigg principles, I consider that Mr Rouessart future anticipated period of employment with North East Shepparton would have been no more than mid-January 2024. Had North East Shepparton provided him with a warning or imposed other disciplinary action against him as a consequence of his conduct, that may well have further shortened this period. In the overall circumstances, I set the anticipated period of employment at five 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.[89] What is reasonable depends on the circumstances of the case.[90]
In his submissions on the subject, Mr Rouessart says that he had, at the time of completing them, applied to several sales/General Manager roles. To that date he had four interviews, however had been unsuccessful in obtaining a position, with him commenting that his distance from the relevant workplaces seems to be an issue for potential employers.
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
There is no evidence that the Applicant had any amount of remuneration from employment or other work during the period between his dismissal and my consideration of an order for compensation.
The letter of termination issued to Mr Rouessart states that he was dismissed, with immediate effect, without notice, from which it may be drawn that Mr Rouessart was not provided with any payment in lieu of notice.
The Respondent’s submissions put forward that Mr Rouessart has a “private commercial business” which generates income from different streams including aquaculture, livestock or spreading and cropping. No evidence of any substance was put forward by the Respondent in relation to this contention. Mr Rouessart himself contests that the business, being a small farm, generates any significant income. As there is no evidence before me that the income generated from the farm was anything more than incidental, and that this did not change after he was dismissed, I do not consider any deduction needs to be made from an award of compensation for the purpose of this criterion.
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
There is no evidence before me on the subject.
Other relevant matters
I do not consider there are any other relevant matters that required being taken into account in setting the amount of compensation, other than to follow the Commission’s usual practice in its calculation.
Compensation – how is the amount to be calculated?
The well-established approach to the assessment of compensation in unfair dismissal matters 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).[91] The approach and Sprigg reasoning has been confirmed several times in Full Bench decisions, and most recently in ERGT Australia Pty Ltd v Kevin Govender.[92]
The approach in Sprigg is as follows:
Step 1: Estimate the remuneration the Applicant 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.
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
At the time of Mr Rouessart’s dismissal, he received a salary of $100,000 per year, as well as being issued with a mobile phone, work laptop and a fully maintained vehicle for which he had reasonable private use. He also participated in a sales incentive scheme which provided him with 10% gross profit on vehicles delivered.
According to the Respondent, Mr Rouessart earned $72,065.13 in the six months prior to his dismissal, which equates to $2771.74 per week.[93] That amount though likely includes payments made to Mr Rouessart as a result of the sales incentive scheme. No information is before me as to be imputed reasonable private use value of the company provided motor vehicle. On the one hand, given that concerns about his performance had been raised in detail with him in November, it could be said that use of the weekly rate derived from the six-month earnings is inappropriate for the purpose of this decision, however, given that I do not have material before me in relation to the value of the motor vehicle or the elements of sales incentive scheme included in calculation of the six month rate, I consider the two potentially even out, one against the other. As a result, the estimate of the Applicant’s remuneration will be on the basis of $2,771 per week.
I have estimated the remuneration Mr Rouessart would have received, or would have been likely to have received, if North East Shepparton had not terminated him, to be $13,855, on the basis of my finding that he would likely have remained in employment for a further period of 5 weeks.
Added to that amount is $1,524, being the amount of statutory superannuation contributions Mr Rouessart would have received for the anticipated period of employment (on the basis of 11% being the applicable rate from 1 July 2023).
Step 2
The second step in Sprigg requires the deduction of monies earned since termination, with the only exclusions being moneys received from other sources and unrelated to work done. There is no evidence of any monies in this respect. To the extent that Mr Rouessart received any income from his farm, if any, I consider this to be a neutral consideration with no deduction required on the basis that it is likely such income did not appreciably change before and after the dismissal.
Step 3
It is necessary to consider the impact of both favourable and unfavourable contingencies on the amounts likely to be earned by the Applicant for the remainder of the anticipated period of employment,[94] noting that it may not be appropriate to deduct contingencies if all of the projected period of continued employment has passed.[95] In Mr Rouessart’s case, I find there are none that ought to be taken into account in this matter, since the whole of the anticipated period of employment has passed.
Step 4
I have considered the impact of taxation, but have elected to settle a gross amount as set out in the table below and the compensation to be ordered will be subject to taxation according to law.
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.”[96]
I am satisfied that the compensation to be ordered by me is proportionate to the circumstances of the case. In this regard I consider the total quantum to be appropriate, with no deductions either for efforts to obtain further employment, or post-termination earnings.
Compensation – is the amount to be reduced on account of misconduct?
If I am satisfied that misconduct of the Applicant contributed to the employer’s decision to dismiss, I am obliged by s.392(3) of the Act to reduce the amount I would otherwise order by an appropriate amount on account of the misconduct.
In determining the amount by which it is appropriate to reduce an order for compensation on account of misconduct, the Commission must consider, amongst other things, whether the Applicant engaged in misconduct and, if so, whether that misconduct contributed to the Respondent’s decision to dismiss the person. A Full Bench of the Commission has observed that, “[t]he section seems to require such consideration even if the FWC has found there was no valid reason for the person's dismissal.”[97] However, the Full Bench goes on to say that, “if there was no valid reason for the dismissal we think that may be relevant to the FWC's decision as to the ‘appropriate’ amount by which to reduce the amount of compensation the FWC would otherwise order.”[98]
In the circumstances set out in this decision, I consider it appropriate to reduce the award of compensation to Mr Rouessart by one week.
My calculation of the amount payable to Mr Rouessart is set out in the following table:
| 1. Estimate the amount the employee would have received or would have been likely to receive if the employment had not been terminated, | 5 weeks projected lost income at the rate of $2,771 per week. | $13,855 |
| Employer superannuation contribution – 11% (as applicable after 1 July 2023) | + $1,524 | |
| Subtotal | $15,379 | |
| Deduction attributable to mitigation efforts | $0 | |
| Deduction for misconduct (1 week at $2,771 + $305 superannuation) | – $3076 | |
| 2. Deduct monies earned since termination, | $0 | |
| 3. Deductions for contingencies, | $0 | |
| TOTAL | $12,303 | |
| 4. Calculate any impact of taxation, | To be taxed according to law | |
| 5. Apply the legislative cap. | Does not exceed the compensation cap. |
An order for compensation consistent with the above table will be issued by me at the same time as this decision.[99] The order will require a payment of wages in the amount of $11,084, to be taxed according to law, and of superannuation in the amount of $1,219, to be paid into Mr Rouessart’s nominated superannuation fund (a total of $12,303), each to be paid within 14 days of the date of this decision.
Mr Rouessart’s application is determined accordingly.
COMMISSIONER
Appearances:
S Rouessart, the Applicant
N Politt, for North East Group
Hearing details:
23 May.
2024.
[1] Respondent Outline of Arguments: Merits; Digital Hearing Book, p.120.
[2] Rouessart, Steven - Letter of Offer; Digital Hearing Book, p.50.
[3] Rouessart, Steven - Employment Contract, Digital Hearing Book, p.147.
[4] Letter of Offer; DHB, p.50.
[5] Employment Contract, DHB, p.157.
[6] Employer Response Form, Form F3, Item 3.1; Digital Hearing Book, pp.98 – 99.
[7] Applicant Outline of Arguments: Merits; Digital Hearing Book, p.16.
[8] Respondent Witness Statements: Suzanne Cornish and Deane Crowhurst, Crowhurst WS; Digital Hearing Book, p.136.
[9] Applicant Outline of Arguments; DHB, p.17.
[10] Applicant’s Document 20; Digital Hearing Book, pp.78 – 79.
[11] Respondent’s Document 5; Digital Hearing Book, pp.207 – 209.
[12] Cornish WS; DHB, p.133.
[13] Applicant’s Document 20; DHB, pp,78 – 79.
[14] Applicant’s Document 8; DHB, p.47.
[15] Applicant Outline of Arguments: Merits; DHB, p.18.
[16] Cornish WS, DHB; p.133.
[17] Ibid.
[18] Ibid.
[19] Ibid, pp.133 – 134.
[20] Ibid, p.134.
[21] Transcript, PN 397.
[22] Cornish WS; DCB, p.134.
[23] Ibid.
[24] Ibid.
[25] Transcript, PN 95.
[26] Respondent’s Document 9; DCB, p,223.
[27] Respondent Outline of Argument: Merits; DCB, p,120; Cornish WS; DCB, p.135.
[28] Applicant Outline of Arguments: Merits; DCB, p.19.
[29] Cornish WS; DCB, p.135.
[30] Applicant Outline of Arguments: Merits; DCB, p.19; Respondent Outline of Argument: Merits; DCB, p.120; Cornish WS; DCB, p.135.
[31] Applicant Outline of Arguments: Merits; DCB, p.19.
[32] Applicant Outline of Arguments: Merits; DCB, p.19; Applicant’s Document 13; DCB, p.67.
[33] Employer Response Form, Form F3, Attachment 1; Digital Hearing Book, pp.102 – 103.
[34] Applicant's Document 24; DHB, p.73.
[35] Titan Plant Hire Pty Ltd v Shaun Van Malsen[2016] FWCFB 5520.
[36] Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371 at 373.
[37] Edwards v Giudice [1999] FCA 1836; (1999) 94 FCR 561 at [6] - [7].
[38] Sharp v BCS Infrastructure Support Pty Limited[2015] FWCFB 1033 at [32]; Annetta v Ansett Australia (2000) 98 IR 233 at [9] - [10].
[39] Sharp v BCS Infrastructure Support Pty Limited[2015] FWCFB 1033 at [32]; He v Lewin [2004] FCAFC 161; (2004) 137 FCR 266 at [15].
[40] Sharp v BCS Infrastructure Support Pty Limited[2015] FWCFB 1033 at [33]-[34]; O'Connell v Wesfarmers Kleenheat Gas Pty Ltd [2015] FWCFB 8205 at [22] - [23].
[41] Edwards v Giudice and Others [1999] FCA 1836, 94 FCR 561, [4].
[42] Selvachandran v Peteron Plastics (1995) 62 IR 371, 373.
[43] Robe v Burwood Mitsubishi Print R4471 (AIRCFB, Ross VP, Polites SDP, Foggo C, 11 May 1999).
[44] Miller v UNSW [2003] FCAFC 180 (Gray J), [13].
[45] Selvachandran v Peteron Plastics (1995) 62 IR 371, 373.
[46] [1938] HCA 34; (1938) 60 CLR 336.
[47] Wong v Taitung Australia Pty Ltd[2017] FWCFB 990 at [11].
[48] [1938] HCA 34; (1938) 60 CLR 336 at 350, 363.
[49] Commonwealth of Australia (Australian Taxation Office) t/a Australian Taxation Office v Shamir[2016] FWCFB 4185 at [46] citing Walton v Mermaid Dry Cleaners Pty Ltd (1996) 142 ALR 681 at 685.
[50] Commonwealth of Australia (Australian Taxation Office) t/a Australian Taxation Office v Shamir[2016] FWCFB 4185 at [46] citing Allied Express Transport Pty Ltd v Anderson (1998) 81 IR 410 at 413.
[51] Edwards v Giudice [1999] FCA 1836 at [7].
[52] King v Freshmore (Vic) Pty Ltd Print S4213 (AIRCFB, Ross VP, Williams SDP, Hingley C, 17 March 2000) at [23] - [24].
[53] Titan Plant Hire Pty Ltd v Malsen[2016] FWCFB 5520 at [28].
[54] Sharp v BCS Infrastructure Support Pty Limited[2015] FWCFB 1033 at [36].
[55] Ibid, [32].
[56] Bista v Glad Group Pty Ltd[2016] FWC 3009.
[57] See Fair Work Act 2009, s.12 Dictionary “serious misconduct” has the meaning prescribed by the regulations.
[58] Respondent's Documents, Unsigned Employment Contract; Digital Hearing Book, p.277.
[59]Applicant Outline of Arguments: Merits; DCB, p.17.
[60] Ibid.
[61] Cornish WS; DHB, p.133.
[62] Ibid, pp.133 - 134.
[63] Ibid, p.134.
[64] Transcript, PN 395 – 405.
[65] Applicant Outline of Arguments: Merits; DCB, p.17.
[66] Cornish WS; DHB, p.135.
[67] Transcript, PN 177.
[68] Transcript, PN 370.
[69] Transcript, PN 367.
[70] Applicant Outline of Arguments: Merits; DCB, p.16.
[71] Transcript, PN 487 – 488; Cornish WS; DHB, p.135.
[72] Transcript, PN 729 – 730.
[73] Applicant's Document 27; DHB, p.87.
[74] Employer Response Form, Form F3, Attachment 1; Digital Hearing Book, pp.102 – 103.
[75] Respondent Outline of Argument: Merits, Item 5a; DHB, p.121.
[76] Transcript, PN 118.
[77] Chubb Security Australia Pty Ltd v Thomas (unreported, AIRCFB, McIntyre VP, Marsh SDP, Larkin C, 2 February 2000) Print S2679 [41].
[78] Wadey v YMCA Canberra [1996] IRCA 568 cited in Dover-Ray v Real Insurance Pty Ltd[2010] FWA 8544; (2010) 204 IR 399 at [85].
[79] Royal Melbourne Institute of Technology v Asher (2010) 194 IR 1; [2010] FWAFB 1200 at [26] citing Gibson v Bosmac Pty Ltd [1995] IRCA 222; (1995) 60 IR 1 at 7 (Wilcox CJ).
[80] Gibson v Bosmac Pty Ltd [1995] IRCA 222 (5 May 1995); (1995) 60 IR 1 at 7 (Wilcox CJ).
[81] Cornish WS; DHB, p.135.
[82] Applicant’s Document 18; DHB, p.74.
[83] [2013] FWCFB 6191.
[84] [1995] HCA 24 (McHugh and Gummow JJ), [128].
[85] Australia Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1,10 citing Byrne v Australian Airlines Ltd [1995] HCA 24 (McHugh and Gummow JJ), [128].
[86] He v Lewin [2004] FCAFC 161, [58].
[87] Cornish WS; DHB, p.134.
[88] Transcript, PN 417.
[89] Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34] citing Lockwood Security Products Pty Ltd v Sulocki and Ors PR908053 (AIRCFB, Giudice J, Lacy SDP, Blair C, 23 August 2001), [45].
[90] Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34] citing Payzu Ltd v Saunders [1919] 2 KB 581.
[91] (1998) 88 IR 21.
[92] [2021] FWCFB 5389, [35].
[93] Respondent Outline of Argument: Merits, Items 2a – 2c; DHB, pp.110 – 111.
[94] Enhance Systems Pty Ltd v Cox[2001] AIRC 1138, [39]
[95] Bowden v Ottrey Homes[2013] FWCFB 431, [54].
[96] Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries[2016] FWCFB 7206, [17].
[97] Read v Gordon Square Child Care Centre Inc [2013] FWCFB 762, [83].
[98] Ibid.
[99] PR777545
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