Mr Sudharson Thapaliya v Caddle Investments Pty Ltd T/A Edenwood Automotive

[2021] FWC 3294

[2021] FWC 3294

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
Section 394 - Application for unfair dismissal remedy

Mr Sudharson Thapaliya
v
Caddle Investments Pty Ltd T/A Edenwood Automotive
(U2021/1887)

DEPUTY PRESIDENT ANDERSON ADELAIDE, 9 JUNE 2021

Application for an unfair dismissal remedy – mechanic – whether dismissal harsh unjust or unreasonable – performance failures – counselling but absence of formal warnings – application dismissed

[1] On 6 March 2021 Sudharson Thapaliya (Mr Thapaliya or the applicant) applied to the Commission under section 394 of the Fair Work Act 2009 (the FW Act) for an unfair dismissal remedy in relation to his dismissal by Caddle Investments Pty Ltd trading as Edenwood Automotive 1 (Caddle, the employer or the respondent). He claims to have been unfairly dismissed on 5 March 2021.

[2] Mr Thapaliya was dismissed with a week’s notice paid in lieu. At the date of dismissal he was employed as a mechanic.

[3] Mr Thapaliya claims his dismissal was harsh, unjust or unreasonable. He seeks such orders as the Commission considers appropriate.

[4] Caddle oppose the application. It says it terminated Mr Thapaliya on 5 March 2021 on performance grounds. It contends the dismissal was neither harsh, unjust or unreasonable, and no issue of remedy arises.

[5] Mr Thapaliya declined to participate in conciliation by a staff conciliator. On 29 March 2021 I issued directions requiring the matter be conciliated. Member Assisted Conciliation was conducted. The matter did not resolve. I issued directions (22 April) for determination of the application.

[6] I conducted a hearing (merits and remedy) by video conference on 3 June 2021. Mr Thapaliya was self-represented. Caddle were represented by an officer of an industrial association, the Motor Trade Association of South Australia.

[7] As Mr Thapaliya was self-represented and the employer represented by an experienced industrial officer, I provided a measure of assistance to Mr Thapaliya to present his case and test that of the employer, consistent with my responsibilities as an independent statutory office-holder.

Evidence

[8] The evidence (oral and documentary) was relatively confined to events occurring in the months preceding termination.

[9] I heard evidence from five persons:

•  Sudharson Thapaliya (Applicant) 2;

•  Maria Caddle (Director) 3;

•  Steven Hammer (Head Mechanic) 4;

•  Geoffrey Caddle (Manager, Edenwood Automotive) 5; and

•  Michael Caddle (Manager, Caddle Crash Repairs) 6.

[10] All witnesses other than Mr Thapaliya were called by Caddle.

[11] There is an extreme diversion between the evidence of Mr Thapaliya and the evidence of each of the Caddle witnesses on almost all factual matters. The most material of those factual differences are:

•  whether Mr Thapaliya was made aware of or spoken to by any manager or officer of the employer about substandard workmanship or customer complaints. Mr Thapaliya denied that he had been spoken to. Each of the Caddle witnesses gave evidence they had spoken to Mr Thapaliya on multiple occasions;

•  whether Mr Thapaliya was counselled or warned about substandard workmanship or customer complaints. Mr Thapaliya denied he had been counselled or warned in writing or verbally. Caddle witnesses gave evidence that each had verbally counselled and (in the case of Geoff Caddle) warned Mr Thapaliya; and

•  whether documents produced in the hearing by Caddle in the form of Customer Complaint Forms and Non Conformance Forms were genuine business records. Mr Thapaliya claimed that they were “fake documents” created for the purpose of these proceedings. Each of the Caddle witnesses gave evidence that the documents were genuine business records contemporaneously made with events, and in many cases populated by the witness themselves.

[12] To resolve these factual differences issues of credit are relevant.

[13] With one caveat only, I prefer the evidence of Maria Caddle, Steven Hammer, Geoff Caddle and Michael Caddle over the evidence of Mr Thapaliya on these points and generally.

[14] Maria Caddle (Mrs Caddle) gave evidence with conviction. On matters of direct knowledge her evidence was reliable and plausible. She had oversight, amongst other matters, for staffing and ensuring that customer complaints were addressed by each of the Caddle businesses. Her evidence that Customer Complaint Forms and Non Conformance Forms were genuine business records was plausible, unimpeached and corroborated by the evidence of others. Although somewhat defensive in questions from the Commission as to the hearsay elements of her statement (events involving others to which she was not a party) her evidence on matters where she was directly involved was reliable.

[15] Steven Hammer was clear and gave evidence with no particular gloss. He had good recall of specific dealings with Mr Thapaliya on particular vehicles. He was a witness of credit.

[16] Geoff Caddle was direct and measured in giving evidence. Although Mr Thapaliya’s manager, he did not overstate his evidence of dealings with disgruntled customers or with Mr Thapaliya, or his views on Mr Thapaliya’s shortcomings. He was a witness of credit.

[17] Michael Caddle was considered and balanced in his evidence. He had good recall of specific dealings with Mr Thapaliya in the 10 February to 16 February 2021 period. He did not overstate his views of Mr Thapaliya’s workmanship and acknowledged strengths (in vehicle diagnostics) as well as weaknesses (mechanical repair).

[18] Mr Thapaliya’s evidence requires considerable caution. Except under detailed questioning, it lacked specificity and even then many answers were flat denials or generic responses. The flat denials lacked credibility. The denial of having ever been spoken to about customer complaints or substandard workmanship was not only against the weight of evidence but at odds with the documentary record. His assertion that Caddle’s witnesses “made up history” 7 of sub-standard workmanship was self-serving. The assertion that Customer Complaint Forms and Non Conformance Forms were “fake documents” created for the purpose of these proceedings is implausible and advanced with no supporting evidence whatsoever.

[19] The caveat I express is with respect to how Mr Thapaliya came to work beyond his probationary period and whether there was discussion between he and the employer about that fact. I make findings on that issue in the body of this decision.

[20] I make one final observation on the evidence. A dismissed employee will naturally seek, in unfair dismissal proceedings, to cast their case in the best possible light, as will an employer. From time to time, this may involve some gloss, intentional or otherwise, on evidence or recall of events. However, there is an important difference between placing gloss on one’s evidence, and serious allegations for which no evidence is advanced.

[21] In this matter, Mr Thapaliya made two serious allegations against the employer: that the employer produced and submitted to the Commission fake documents and (in the course of giving his evidence but not notified beforehand) that the employer’s dismissal was racially motivated. Each are serious allegations (indeed, they infer unlawful conduct). Each required the employer’s response, and were responded to.

[22] I make some allowance that Mr Thapaliya, in his own mind, may hold these views given that he sees no basis on which he could have been fairly dismissed. I also make some allowance that Mr Thapaliya was self-represented and appears not to have had the benefit of independent advice on how to present his case. This notwithstanding, it is necessary to observe that the unfair dismissal jurisdiction is not a forum to raise scandalous allegations but then lead no evidence in support. The reputational damage that can be left for either a business or a dismissed employee from such allegations, especially having regard to the principle that the Commission’s hearings and decisions are publicly available but privileged, may be profound.

[23] Given that, I indicate that whilst Mr Thapaliya made allegations that Caddle created false documents to mislead the Commission and acted with racial intent in dismissing him, there is not a scintilla of evidence to support either assertion. I expressly find that Caddle did not engage in such conduct. Such assertions ought not to have been made without some evidence in support. It was only for the purpose of affording Mr Thapaliya procedural fairness during the hearing that these assertions remain on the record.

Facts

[24] I make the following findings.

Background

[25] Caddle is a long-standing family business in the vehicle repair and service industry in South Australia. It operates multiple businesses in suburban Adelaide, one of which is Edenwood Automotive (Edenwood). Edenwood is a mechanical repair workshop in the Adelaide Hills.

[26] Caddle employs forty-two staff. At the relevant time, Edenwood employed six of those staff – one manager (Geoff Caddle), an administrative officer, and four mechanics (head mechanic Mr Hammer, a mechanic Mr Thapaliya, another mechanic and an apprentice).

[27] Mrs Caddle has been a director of Caddle for 49 years, and is a co-owner with other family members. She has overall management of different arms of the business including customer and staffing issues. There is no dedicated human resource management.

[28] Both Geoff Caddle (who manages Edenwood) and Michael Caddle (who manages Caddle Crash Repairs) report to Mrs Caddle. Geoff and Michael Caddle are brothers, and sons of Mrs Caddle.

[29] From time to time, and although not located at Edenwood, Mrs Caddle and Michael Caddle would attend the Edenwood premises. Mrs Caddle would do so most days on her way to work.

Mr Thapaliya’s employment

[30] Mr Thapaliya commenced employment with Caddle at Edenwood on 16 July 2020.

[31] He worked continuously for eight months as a mechanic until dismissed on 5 March 2021.

[32] Mr Thapaliya was employed in response to a job advertisement and interview process overseen by Michael Caddle 8. Mr Thapaliya’s CV indicated that he was a “qualified motor mechanic with 5 years of experience in Australia” and that he had worked for four businesses (motor mechanic and taxi driving) in the preceding five years9. Mr Thapaliya holds a Certificate 3 in Light Vehicle Mechanical Technology obtained in May 2016 from a registered training organisation, Quality Automotive Training. Mr Thapaliya provided Caddle with this certification in his job application.

[33] Upon employment, Caddle provided Mr Thapaliya a Contract of Employment 10 and a Job Description as a Mechanic11.

[34] Mr Thapaliya was employed as a full time employee with a probationary period of six months.

[35] Mr Thapaliya has a young family. For certain periods whilst employed, Mr Thapaliya was unable to work full time and meet his family responsibilities. By agreement, during those periods, Mr Thapaliya was a part time employee working the hours he could. At the date of dismissal, Mr Thapaliya had resumed as a full time employee.

[36] Mr Thapaliya reported to Edenwood’s manager, Geoff Caddle. Geoff Caddle was a hands-on manager. He liaised directly with staff at Edenwood, and with its regular customers. Mr Thapaliya also took direction and guidance from the head mechanic, Mr Hammer.

[37] Upon commencing, Mr Thapaliya was expected to be able to work on light vehicles in parallel with being informally guided by Mr Hammer and Geoff Caddle in Caddle’s systems and expectations.

[38] The expectations of Mr Thapaliya were no different from that of other mechanics. Specific details were contained in the job description. In summary, they included:

•  being able to completely diagnose, disassemble, repair and reassemble mechanical parts of vehicles;

•  carrying our repairs and instructions as per job cards;

•  test drive all vehicles repaired prior to leaving them for customer collection;

•  keep accurate records of parts used and work done;

•  keep the working environment clean and tidy; and

•  be familiar with and refer where necessary to company policies, procedures or manufacturer repair guides.

[39] Work was allocated to mechanics by the manager, Geoff Caddle. The work would be set out in a job card. Upon completion of the work, the mechanic would test drive the vehicle, sign-off the job card and leave the vehicle for customer payment and collection.

Process for customer complaints

[40] When a vehicle was collected, the customer would deal with either Geoff Caddle or the administrative officer, but generally not the specific mechanic who worked on the vehicle.

[41] From time to time, as with any business, customers would raise a concern with a repair job. Customers would either return the vehicle to the workshop or discuss the concern over the telephone or on-line. Caddle’s practice was that when a customer returned a vehicle for re-work, a two-step process would apply. Firstly, a Customer Complaint Form would be completed. Generally these were completed by the manager (Geoff Caddle) or the administrative officer. Secondly, the manager would then discuss the complaint with the mechanic who undertook the repair, and if the manager considered that the vehicle required re-work by Caddle then re-work would be performed at Caddle’s expense (or on terms negotiated with the customer). The manager would determine, in their discretion, which mechanic would perform the re-work; sometimes, but not always was re-work allocated to the original mechanic.

[42] Occasionally but rarely, Caddle would need to outsource (at its expense) re-work to a third party repairer. Also occasionally but rarely a customer decided to have re-work done by a third party and, only after the re-work was complete, approach Caddle for reimbursement. In those circumstances, Caddle’s management (often including Mrs Caddle) would need to approve reimbursement of third party costs where appropriate to do so. The original Caddle mechanic would be typically informed when there had been approved third party re-work on a vehicle they had repaired.

Concerns with Mr Thapaliya’s workmanship

[43] In the first six months of Mr Thapaliya working in the business, Geoff Caddle and Mr Hammer developed concerns with Mr Thapaliya’s workmanship. These concerns arose from two sources:

•  by direct observation of Mr Thapaliya whilst working on vehicles in the workshop; and

•  by an emerging number of customer complaints concerning vehicles that had been repaired by Mr Thapaliya and which had been assessed as requiring re-work and where the re-work had identified shortcomings with the initial repair.

[44] Mr Hammer developed doubts whether Mr Thapaliya had the skills to perform some basic repair tasks beyond diagnosing problems and disassembling mechanical parts. He considered that basic mistakes in repair and reassembly were being made, especially with respect to brakes.

[45] Progressively, Geoff Caddle came to share these concerns.

[46] Both Geoff Caddle and Mr Hammer spoke to Mr Thapaliya on a regular basis when they observed concerns, and made suggestions to him about how he might, or might better, go about performing or completing a mechanical task.

[47] However, each got on well with Mr Thapaliya in a person-to-person sense, and neither wanted to be too hard on him as he was a new employee (albeit a qualified mechanic). They wanted him to improve and provided guidance and oversight.

[48] Over time, and in both 2020 and into 2021 customer complaints became more frequent concerning vehicles that had been repaired by Mr Thapaliya, and which required re-working.

[49] Between 16 July 2020 and 5 March 2021 Edenwood had fourteen non-conformances (that is vehicles assessed as requiring re-work at Caddle’s expense). Twelve of the fourteen concerned vehicles which had been repaired by Mr Thapaliya. Most but not all of the twelve re-works concerned problems with brakes or brake repairs.

Work beyond probationary period

[50] As January 2021 came and passed, neither Geoff Caddle nor Mrs Caddle identified that Mr Thapaliya’s six month probation expired on 16 January 2021.

[51] Mr Thapaliya’s evidence was that in January 2021 he had a brief conversation with Geoff Caddle about his probationary period. Mr Thapaliya says that around the time of his probationary period expiring (16 January 2021) he asked Geoff Caddle for confirmation that he was continuing in employment and was given that assurance.

[52] Geoff Caddle could not recall any such conversation.

[53] Despite my caution about Mr Thapaliya’s evidence, it is not implausible that such a conversation occurred, albeit informally and briefly. It is not implausible that Mr Thapaliya may recall it, and that Mr Caddle, given his overall responsibilities, may have been unable to recall it.

Attendance by Michael Caddle 10 to 16 February 2021

[54] Michael Caddle was asked to work in the Edenwood business for a dedicated period between 10 to 16 February 2021.

[55] Michael Caddle did so at the request of Geoff Caddle and Mrs Caddle and for two purposes: to assist Geoff Caddle because Edenwood was understaffed; and to audit Edenwood’s operations and provide advice to Geoff and Mrs Caddle about the business.

[56] Prior to working at Edenwood during this period, Michael Caddle had been informed in general terms about concerns with Mr Thapaliya’s workmanship and customer complaints. An element of Michael Caddle’s brief over these six days, but by no means the sole purpose, was to observe Mr Thapaliya (as well as the other mechanics) and assist them where required.

[57] During the course of these six days, Michael Caddle had multiple discussions with Mr Thapaliya arising from occasions when he observed errors in Mr Thapaliya’s workmanship. Michael Caddle provided guidance, made suggestions and occasionally gave instruction.

[58] I deal further with these issues in considering valid reason.

Decision to dismiss

[59] In the fortnight following Michael Caddle’s deployment to Edenwood, regular discussions occurred between Michael Caddle, Geoff Caddle and then Mrs Caddle about concerns with Mr Thapaliya’s workmanship.

[60] As further issues of concern arose following 16 February 2021 the discussions became focussed on whether the business needed to dismiss Mr Thapaliya.

[61] On or either the day prior to 5 March 2021 (more probably than not, on that day), in a joint discussion between Michael Caddle, Geoff Caddle and Mrs Caddle a decision to dismiss was made. Mrs Caddle expressed the view that the business could no longer have trust and confidence in Mr Thapaliya’s workmanship and that he had been given enough opportunities. She expressed the view that his poor workmanship left the business and its customers seriously exposed. She believed that the safety of customers was at risk when repaired cars were returned with brake problems. She said that the business was suffering reputational damage due to verified customer complaints. She said that it was costing the business in re-work, including paying for third party re-works.

[62] Mrs Caddle recommended dismissal. That was agreed by Geoff and Michael Caddle.

[63] As Michael Caddle had been the person who first employed Mr Thapaliya, it was decided that Michael Caddle would advise Mr Thapaliya of his dismissal.

[64] Later that day, 5 March 2021, Michael Caddle travelled to the Edenwood business. He approached Mr Thapaliya and took him aside, adjacent to Geoff Caddle’s office. He said words to the effect:

“Sudi, we have decided to terminate your employment. Your work is not up to standard. It is causing a real problem for the business. You’ll get a week’s pay in lieu of notice. Your annual leave entitlements will be paid out. This is a business decision and not a personal one.”

[65] Mr Thapaliya immediately went into Geoff Caddle’s office. He sought confirmation whether he was in fact dismissed. Geoff Caddle confirmed the dismissal. He told Mr Thapaliya that it was a decision that had to be made by the business and was not about him personally. Mr Thapaliya said that it was personal and that it was not right.

[66] Mr Thapaliya collected his belongings and left.

[67] The following morning (7.31am), Mr Thapaliya commenced these proceedings.

[68] Once advised that Mr Thapaliya had been dismissed, Mrs Caddle prepared a formal letter and sent it to Mr Thapaliya. It read: 12

“Date: 5.3.2021

Subject: Confirmation of Termination of Employment of Sudharson Thapaliya

Dear Sudharson,

I write to confirm that on 5.03.2021 your employment with this company was terminated after a review of your performance and discussions with you regarding the many reworks as a result of repairs performed by you, and your inability to improve where required.

The specific reasons for your termination include:

1. lack of knowledge to diagnose and safely repair vehicles

2. lack of care of customer vehicles

3. unsafe work practices and unacceptable behavior

As discussed with you, your employment is terminated from the date of this letter by payment of one weeks salary in lieu of notice.

A breakdown for your final pay was emailed to you.

If you have any enquiries regarding this advice, please contact the undersigned.

Yours sincerely,

Maria Caddle”

Consideration

[69] The issue for determination is simply put: was Mr Thapaliya’s dismissal harsh, unjust or unreasonable having regard to the considerations in section 387 of the FW Act and, if so, is it appropriate to order a remedy by way of reinstatement or compensation?

[70] No jurisdictional issues arise. Mr Thapaliya was protected from unfair dismissal within the meaning of section 382 of the FW Act. He served the statutorily required minimum employment period (section 382(2)(a)). His annual rate of earnings did not exceed the high income threshold (section 382(2)(b)(iii)). His employer was a “national system employer” within the meaning of section 14 of the FW Act. His application was filed within the statutorily required 21 days after dismissal took effect.

[71] I am under a duty to consider each of the criteria in section 387 of the FW Act 13, and now do so.

[72] Section 387 of the FW Act provides 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.”

Valid reason (section 387(a))

[73] An employer must have a valid reason for dismissal of an employee. It is the Commission’s task to determine if a valid reason exists. The reason(s) should be “sound, defensible and well founded” 14 and should not be “capricious, fanciful, spiteful or prejudiced”15.

[74] To fairly assess whether alleged deficiencies in Mr Thapaliya’s performance were, individually or collectively, a valid reason for dismissal his performance needs to be objectively assessed against his employment obligations and considered in the context of surrounding circumstances applicable at the time of any relevant performance failures.

[75] Mr Thapaliya’s employment obligations were the duties and skills identified in the job description he signed on 4 August 2020 16, as summarised earlier in this decision.

[76] A relevant surrounding circumstance is that, at the time of employment and throughout his employment, Caddle sought the services of a fully qualified mechanic and Mr Thapaliya held himself out as such with five years of experience. He was not employed as an apprentice or trainee, or with an expectation that he would need to be shown by the head mechanic or others how to competently perform basic repair functions.

[77] There are multiple alleged deficiencies relied upon by Caddle relevant to the dismissal. I now deal with those principal amongst them.

Failure to competently repair brakes

[78] It is alleged that on multiple occasions across months, and including after guidance and instruction, Mr Thapaliya failed to competently and safely repair brakes on vehicles or return vehicles to customers with brakes in full repair.

[79] The evidence establishes this proposition.

[80] Mr Hammer’s evidence was that “Sudi could not do brakes or clutches” 17.

[81] Numerous of the recorded customer complaints relevant to Mr Thapaliya’s work concerned brakes. Specific examples are given in the evidence of Mr Hammer, Geoff Caddle and Mrs Caddle about customers coming back within days of the repair work and complaining of brakes or brakes still being spongy, leaking or shuddering, and requiring rework 18.

[82] Alarmingly, Mr Hammer’s further evidence 19 was that on at least one occasion Mr Thapaliya had left a vehicle for collection by a customer, and only by virtue of Mr Hammer having to move that vehicle in the car park before collection, did he identify that the vehicle’s brakes were not working properly. He had to deploy the handbrake to stop the vehicle.

[83] Relevantly, Mr Hammer’s evidence 20 was that the failure to competently repair brakes continued after instruction and guidance. In the instance of having to deploy the handbrake, he personally reviewed the issue with Mr Thapaliya, identified that a degreasing process had not been competently performed, and instructed Mr Thapaliya on what he had failed to do.

[84] I also accept Mr Hammer’s evidence that this was not an advanced process or skill but a basic competency.

[85] This failure also raises questions (considered below) whether Mr Thapaliya actually test drove this vehicle before leaving it for customer pick-up. In Mr Hammer’s words “we all could smell the burning” 21.

[86] Mr Hammer’s evidence was also that he retrained Mr Thapaliya at least three times on the brake machine. I accept that evidence. Mr Thapaliya claimed that the brake machine was not working properly, and this caused problems with his workmanship. I reject that assertion. There is no evidence whatsoever to support that position. Mr Hammer’s and Geoff Caddle’s evidence was that there was only one brake machine in the workshop; the one used by Mr Thapaliya was the same as used by all mechanics. No other mechanic reported problems with the machine. Brakes worked on customer cars by other mechanics using the same machine were handed over in working order.

[87] I find that on multiple occasions Mr Thapaliya failed to competently repair brakes on customer vehicles, that this failure was ongoing despite instruction, and that this was a basic competency required of a qualified mechanic.

[88] Being a basic and essential requirement of the job, this failure individually constituted a valid reason for dismissal.

Other repair failures

[89] The evidence of Mr Hammer, Geoff Caddle and Michael Caddle raised multiple other alleged failures of mechanical skill and competency on the part of Mr Thapaliya. These included:

•  recurring misdiagnosis of wheel bearing issues 22;

•  failure to fill transmission fluid 23;

•  damage to nuts connecting belt tensioner pulley 24; and

•  damage to a hub when disassembling a vehicle caused by hitting the hub contrary to instruction 25.

[90] I accept this evidence for two reasons. Firstly it is supported by direct observation of these witnesses, and by the documentary record (Customer Complaint Forms and Non Conformance Reports).

[91] Secondly, the evidence was presented in a balanced manner. This is not a matter where the employer has sought to load up every conceivable criticism and present an unbalanced view of overall performance. The evidence of Mr Hammer, Geoff Caddle and Michael Caddle did not assert that every vehicle worked on by Mr Thapaliya over eight months was, on each occasion, deficient. Their evidence was that whilst some core skill deficiencies became apparent reasonably early in this period, not all aspects of the job were beyond Mr Thapaliya. Mr Thapaliya was generally considered capable at diagnostics and usually competent in disassembly of mechanical parts. However repair and reassembly were primary areas of shortcoming 26.

[92] The work of a mechanic, as is evident from Mr Thapaliya’s position description, involved all four elements. His job was not just to identify a problem and pull a vehicle’s mechanics apart. These were necessary preconditions to doing what ultimately the customer was paying for – having the vehicle competently repaired. This required technical skill on repair and reassembly. It was in these areas that Mr Thapaliya underperformed – not always, but on multiple occasions and in serious ways.

[93] I am well satisfied that aside from failures to competently repair brakes, other areas of underperformance occurred on a regular basis. Those matters, collectively, constituted a valid reason for dismissal.

Failure to take instruction

[94] The evidence is that Mr Thapaliya received instruction on the workshop floor but was inconsistent in attentiveness to instructions. On more than the rare occasion Mr Thapaliya showed disinterest by either looking away, looking distracted or walking away. Yet on other occasions he was attentive.

[95] More relevantly, when instruction was given, particularly with respect to brakes, Mr Thapaliya was not consistent in subsequent application of the instructions given. For example, brakes continued to be machined incorrectly.

[96] Allied to this is a view formed initially by Mr Hammer and then by Geoff Caddle that Mr Thapaliya’s technical knowledge was poor. It was said that he referenced Google and on occasions phoned other mechanics (including the apprentice) whilst they were on leave to seek guidance. The evidence on these issues is hearsay and equivocal. I make no findings of failure of technical knowledge or inappropriate research.

[97] Whilst inconsistent failure to take instruction was not, of itself, sufficient to warrant dismissal, in conjunction with other performance failures it formed part of a collective of issues that constituted a valid reason.

Failure to abide by test drive procedures

[98] This failure comprises three elements:

•  that Mr Thapaliya did not test drive every vehicle prior to signing off the job card and leaving the vehicle for customer collection;

•  that Mr Thapaliya did not safely drive customer cars; and

•  that Mr Thapaliya took excessive time to drive vehicles when he test drove them.

[99] There is some evidence to support each of these propositions, though the evidence that each of these failures was routine is not made out.

[100] In respect of vehicles signed off as completed but where brakes were not operative or transmission fluid had not been replaced, an inference clearly can be made that those vehicles were not test driven. As Mr Hammer noted, if they had been, the smell or noise would have readily been evident (and occasionally was).

[101] On at least two occasions Mr Thapaliya was careless in driving a vehicle in and around the workshop. The most serious was when he reversed a vehicle and three times struck a wall resulting in damage. Caddle had to outsource the repair at a cost to the business of $660 27.

[102] The evidence also points to the fact that at least once, when Mr Hammer happened to be test driving a vehicle a short distance behind Mr Thapaliya doing the same, he noticed Mr Thapaliya having pulled over, talking on his phone and smoking. A test drive in a customer vehicle was required to be a test drive only, not a break from work.

[103] I am also satisfied that Mr Thapaliya took some liberties with the length of test drives. On his evidence he said that some test drives took one to two hours. No other witness could conceive of how a test drive could occupy that amount of time. The objective of a test drive was to ascertain if the vehicle had been repaired and was in working order. Mr Thapaliya did not always exercise discipline over the length of time he took to test drive.

[104] The failure to routinely test drive every vehicle prior to signing off the job card and leaving some vehicles for customer collection that had not been test-driven was a serious failure, no matter how many times it occurred. The other failures to abide by test drive procedures and protocols were not, of themselves, sufficient to warrant dismissal, but in conjunction with the failure to test drive all vehicles and other performance failures, formed part of a collective of issues that constituted a valid reason.

Failure to keep work area clean and leave customer vehicles in a clean state

[105] The employer witnesses gave evidence to the effect that whilst Mr Thapaliya was a pleasant and active member of the workshop team, his workshop practices were regularly deficient. In particular:

•  Mr Thapaliya would regularly leave his work environment dirty;

•  Mr Thapaliya occasionally did not safely store or place parts; and

•  Mr Thapaliya occasionally left a vehicle for a customer in a dirty state.

[106] There is evidence to support each of these propositions, though the evidence that each of these failures was routine is not made out.

[107] I accept the evidence 28 of Mr Hammer and Geoff Caddle, and specific example given in the evidence of Michael Caddle29, that from time to time Mr Thapaliya left his working area dirty and messy. On one occasion he allowed transmission oil to remain on the workshop floor and then drove the vehicle through the oil. Mr Thapaliya’s job description specifically required a mechanic to “keep work areas clean”. Whilst the work of a mechanic can be dirty and greasy, the obligation to keep the work environment clean was reasonable and lawful. I do not accept Mr Thapaliya’s evidence that when his work environment was left dirty it was simply because the job was incomplete. This was not the direct observation of Mr Hammer or Michael Caddle.

[108] I also accept the evidence of Michael Caddle that on at least one occasion he told Mr Thapaliya not to store or place parts on the bonnet or roof of a vehicle he was working on, that the instruction was ignored, and that the parts fell across the car and onto the workshop floor.

[109] I also accept that on at least one occasion Mr Thapaliya left a vehicle for collection by a customer with plainly visible grease marks around the inside door lining and that this led to a customer complaint. This was a failure by Mr Thapaliya to take due care before signing off the vehicle for customer collection. Photographs of the soiled car are in evidence 30.

[110] Whilst a failure to keep his work area clean and leave customer vehicles in a clean state was not so routine that it was, of itself, sufficient to warrant dismissal, in conjunction with other performance failures it formed part of a collective of issues that constituted a valid reason.

Reputational damage to the business

[111] I am satisfied that the failures by Mr Thapaliya caused and (had he not been dismissed) had the potential to cause further damage to the reputation of the business.

[112] Twelve out of fourteen customer complaints in a short period of time attributable to the work of Mr Thapaliya represented an issue of serious consequence for the business. Whilst a customer complaint is not evidence of error by an employee (it is evidence only of a complaint) and making allowance for the tendency of some businesses to give its customers benefit of the doubt, it remained the case that customer complaints requiring re-work were not approved without Caddle assessing the complaint and whether the relevant mechanic had in fact been deficient in the work performed. The assessed failures on the twelve customer complaints concerning Mr Thapaliya’s repair work were not fleeting or minor.

[113] In particular, the failure by Mr Thapaliya to leave all repaired vehicles with roadworthy and safe brakes put the safety of customers and other road users at risk. This alone had the potential to cause reputational damage to the business.

[114] Re-work cost the business and inconvenienced customers returning vehicles which had been repaired and paid for. Re-working occupied workshop time allocated to other scheduled work. More directly, on some occasions customers simply had the vehicle re-worked by a third-party repairer and returned to the business with a third party invoice seeking reimbursement. In those instances, re-work became a direct financial cost. An inference is capable of being drawn that those customers at least had no confidence in the business re-working the original repair. I accept Geoff Caddle’s evidence 31 that some customers told him directly that they did not want Mr Thapaliya working on their vehicles or performing re-work.

[115] Caddle acted reasonably in concluding that its reputation was being put at risk by Mr Thapaliya’s workmanship and acted reasonably in protecting its reputation by dismissing an underperforming mechanic.

Conclusion on valid reason

[116] Was Mr Thapaliya’s performance failures a valid reason for dismissal?

[117] The standard an employer can reasonably expect of an employee is that of competence. Whilst the standard is not one of perfection it is more than someone simply trying their best 32. A handful of errors in the ordinary course of a mechanic’s work scattered across months of otherwise competent service would not be a sound or defensible ground for dismissal.

[118] In this matter, the performance failures concerned core duties and competencies, included serious issues, and were continuing. I conclude they were, in combination, a valid reason for dismissal. Moreover, signing off a job when the customer vehicle had a defective brake repair or had not been test driven were valid reasons in their own right.

[119] It is axiomatic that a vehicle delivered back to a customer with brakes in an unroadworthy condition is a matter that placed the business at substantial risk, let alone harm to its customers and the general public. That was an intolerable circumstance, and no responsible business owner could allow that situation to continue.

[120] There were reasonable grounds for a loss of trust and confidence in Mr Thapaliya notwithstanding that at a personal level the owners and managers liked Mr Thapaliya and sought to persevere with him. Trust and confidence is a necessary ingredient of an employment relationship. Its loss, where reasonably founded, is a valid reason for dismissal.

[121] The conclusion that a valid reason for dismissal existed weighs against a finding of unfair dismissal.

Notification of the reason for dismissal (section 387(b))

[122] Mr Thapaliya was only advised in general terms on 5 March 2021 of the reason for dismissal, when Michael Caddle told him it was because of problems with his work. It was not until he received the letter of termination some days later that the reasons were more specifically outlined (lack of knowledge to diagnose and safely repair vehicles; lack of care of customer vehicles and unsafe work practices).

[123] Though Mr Thapaliya clearly disagreed with the reasons, he was notified of them.

[124] This is a neutral consideration.

Opportunity to respond (section 387(c))

[125] Mr Thapaliya was not given the opportunity to respond to the collective allegations of performance failure in advance of the dismissal decision being made and communicated. His brief discussions with both Michael Caddle and then Geoff Caddle on 5 March 2021 were to advise of dismissal, not to seek his views.

[126] However, for reasons considered below, I have concluded that Mr Thapaliya was given opportunities, as performance problems arose, to explain his side of the alleged performance failure(s).

[127] In these circumstances, the failure to be provided an opportunity to respond to the collective reasons for dismissal prior to being dismissed, and the opportunity to do so only as and when the issues arose, denied Mr Thapaliya capacity to express a view about the overall seriousness of his failures or proportionality of the dismissal sanction.

[128] This was in part a denial of procedural fairness that weighs somewhat in favour of a finding of unfair dismissal.

Opportunity for support person (section 387(d))

[129] Even though Mr Thapaliya was not refused a support person, as Mr Thapaliya was not provided a final opportunity to explain, he was not given the opportunity to ask for a support person.

[130] In isolation, this is a neutral consideration.

Warnings concerning performance (section 387(e))

[131] There was no formal written warning issued by Caddle concerning Mr Thapaliya’s performance or conduct.

[132] In circumstances where his performance failures were serious and continuing, this is a material deficiency in procedural fairness.

[133] However, the evidence points to Mr Thapaliya being instructed, retrained, counselled and warned as and when issues of concern arose. Relevantly, what occurred was a combination of instruction, retraining, counselling or warning depending on the seriousness of a performance problem and whether it was repeated.

[134] For example:

•  Mr Thapaliya was provided “retraining” on the brake machine (on multiple occasions);

•  Mr Thapaliya was provided written instruction requiring “corrective action” on “taking care of vehicles” (after he damaged a customer car) 33;

•  Mr Thapaliya was counselled on how “to replace brake pads”, and this was recorded in a Non Conformance Report requiring corrective action 34;

•  Mr Thapaliya was “warned re mess and failing to fill (transmission) oil” and this was recorded in a Non Conformance Report requiring corrective action 35; and

•  Mr Thapaliya was “warned he is not repairing brakes correctly” and this was recorded in a Non Conformance Report requiring corrective action 36.

[135] In total, the Non Conformance Reports of 23 February 2021, 19 February 2021, 5 February 2021, 3 February 2021 (twice), 2 February 2021, 29 January 2021, 10 December 2020 and 4 November 2020 each expressly “required corrective action by Sudi”.

[136] Having accepted the evidence of Geoff Caddle, I am satisfied that these Non Conformance Reports, signed off as they were by the manager (together with the Customer Complaint Form), were usually notified to Mr Thapaliya notwithstanding that the reports were not counter-signed by the originating mechanic.

[137] This notwithstanding, it remains the case that no formal written warning was issued to Mr Thapaliya that drew express attention to the prospect that ongoing failures on his part were likely to lead to disciplinary sanction or dismissal.

[138] This is a material and relevant issue, and must be given weight. It is no minor failing on Caddle’s part.

[139] Notwithstanding the fact of instruction, retraining, counselling and warning (including in written Non Conformance Reports), the absence of a formal warning about potential dismissal, was a material denial of procedural fairness that weighs in favour of a finding of unfair dismissal.

Size of employer’s enterprise (section 387(f)) and human resource capability (section 387(g))

[140] Caddle was not, at the time of dismissal, a small business within the meaning of the FW Act. It was a family business of (at best) moderate size but with no dedicated human resource capacity. I note that the business of Edenwood was conducted on an informal and personal basis though this consideration only goes so far; Edenwood may have had only six employees but was part of the broader Caddle Group as evidenced by the active involvement of Mrs Caddle and Michael Caddle in the dismissal.

[141] It was within the capacity of Caddle to be more considered and formal concerning procedural fairness issues, and more attentive to the expiry of Mr Thapaliya’s probationary period in January 2021.

[142] Overall, the size of the business and its lack of human resource capacity is a neutral consideration and does not explain the failures of procedural fairness.

Other matters (section 387(h))

[143] Mr Thapaliya submits that if his employment was going to end then it should have been when his probationary period expired (on or about 16 January 2021), and that had he been warned of the looming dismissal, he would have voluntarily resigned.

No opportunity to resign

[144] Given my reservations about Mr Thapaliya’s evidence, I do not conclude on the balance of probabilities that he would have volunteered a resignation though it may have been a possible point of discussion given the good interpersonal relations between he and Geoff Caddle.

[145] Moreover, there is no obligation on an employer to provide an opportunity to an employee to resign if they otherwise have a valid reason for dismissal and make the reasons for dismissal known.

Working beyond probationary period infers satisfaction

[146] There are circumstances where an inference can be drawn that an employer continuing to employ a person beyond their probationary term is representing to the employee that the employer is satisfied with their work. However, each case must be determined on its own facts.

[147] This is not a matter where Mr Thapaliya was informed, at the time his probationary period expiring, that the employer was satisfied with his performance. To the contrary, there had already been customer complaints and Non Conformance Reports in the last quarter of 2020, and Mr Thapaliya had already received guidance, instruction and retraining.

[148] Whilst it is uncontroverted that Mr Thapaliya worked beyond his probationary period, no formal performance assessment occurred at the time and no record exists as to whether this was by decision or omission.

[149] It is more probable than not that it was by omission, and that Geoff Caddle in a brief conversation initiated by Mr Thapaliya indicated that Mr Thapaliya was a continuing employee as there had been no decision otherwise. It is more probable than not that Geoff Caddle had not turned his mind to the question until that point, only did so at the time of Mr Thapaliya’s approach, and did not subsequently revisit the issue.

[150] It is readily apparent from my earlier findings that Caddle had concerns with Mr Thapaliya’s workmanship as at 16 January 2021. The evidence of Geoff Caddle was that on both sides of the probationary period the business had concerns but that Mr Thapaliya needed time to overcome identified deficiencies.

[151] On having worked beyond the probationary term, in this matter I do not conclude this to be any more than a neutral consideration.

Conclusion on unfairness

[152] This matter concerns dismissal on notice for ongoing performance failures that resulted in a loss of trust and confidence in Mr Thapaliya.

[153] The onus of proof in establishing that the dismissal was harsh, unjust or unreasonable rests on Mr Thapaliya, being the applicant.

[154] Unfair dismissal matters are multifactorial 37. I take into account all matters in section 387 of the FW Act, as relevant to this application and as considered above. In arriving at an overall assessment, the statutory considerations must be applied in a practical, common sense way to ensure that the employer and employee are each treated fairly38. The Commission will not stand in the shoes of an employer and assess what the Commission would have done had it been in the position of the employer39 but has a statutory obligation to objectively determine fairness given the relevant circumstances.

[155] The ambit of the phrase ‘harsh, unjust or unreasonable’ was explained in Byrne v Australian Airlines Ltd  40 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.”

[156] In reaching my conclusion, I adopt the approach set out by a Full Bench of this Commission in B, C and D v Australian Postal Corporation T/A Australia Post: 41

“[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’.”

[157] I have concluded that there were valid reasons for dismissal of Mr Thapaliya for the collective performance failures and for the specific failure to competently repair brakes and to test drive all repaired vehicles before customer collection.

[158] I take into account the observations of a Full Bench of the Commission in Parmalat Food Products Pty Ltd v Wililo: 42

“The existence of a valid reason is a very important consideration in any unfair dismissal case. The absence of a valid reason will almost invariably render the termination unfair. The finding of a valid reason is a very important consideration in establishing the fairness of a termination. Having found a valid reason for termination amounting to serious misconduct and compliance with the statutory requirements for procedural fairness it would only be if significant mitigating factors are present that a conclusion of harshness is open.”

[159] In this passage both the importance of a valid reason and procedural fairness are emphasised.

[160] Mr Thapaliya was, in part, denied procedural fairness.

[161] A material denial of procedural fairness must be weighed against other relevant factors. As noted, the denial of procedural fairness to Mr Thapaliya weighs in favour of a finding of unfairness. However it does not follow that it necessarily renders his dismissal unfair. As observed by a full bench of this Commission in Federation Training v Sheehan: 43 

“It is trite to observe that any issue/s of procedural unfairness may not be of such significance as to outweigh the substantive reason/s for an employee’s dismissal...”

[162] In this matter, the denial of procedural fairness, when weighed against the serious and collective performance failures and their continuing nature notwithstanding instruction, retraining, counselling and warning, and the reasonably held loss of trust and confidence, do not lead to a conclusion that the dismissal was, considered overall, unfair.

[163] In arriving at this overall assessment, I have applied the statutory considerations in a practical, common sense way to ensure that Mr Thapaliya and Caddle are each treated fairly. Both Mr Thapaliya and Caddle are entitled to a “fair go all round” 44.

[164] For the foregoing reasons, I do not conclude that Mr Thapaliya’s dismissal was harsh, unjust or unreasonable.

Conclusion

[165] As Mr Thapaliya was not unfairly dismissed, the application must be dismissed.

[166] In conjunction with the publication of this decision I issue an order to this effect 45.

DEPUTY PRESIDENT

Appearances:

Mr S Thapaliya, on his own behalf.

Mr C Morey, on behalf of Caddle Investments Pty Ltd T/A Edenwood Automotive with Ms M Caddle.

Hearing details:

2021
Adelaide (by video)
3 June

Printed by authority of the Commonwealth Government Printer

<PR730552>

 1   Mr Thapaliya’s application originally named “Edenwood Auto Trading as Caddle investment pvt ltd” as the Respondent. I granted leave to amend the name of the Respondent to Caddle Investments Pty Ltd T/A Edenwood Automotive on 27 April 2021.

 2   Statement A1; Reply Statement A2

 3   R1

 4   R2

 5   R3

 6   R4

 7   Audio transcript at 3:11pm.

 8 R3 document R

 9 R1 document B

 10 R1 document A

 11 R1 document C

 12 R3 document U

 13   Selvachandran v Peterson Plastics Pty Ltd (1995) 62 IR 371 at 373

 14   ibid

 15   ibid

 16 R1 document C

 17   Evidence of Steven Hammer R2 paragraph 16

 18   For example, evidence of Geoff Caddle R3 paragraphs 26 to 28; evidence of Michael Caddle R4 paragraphs 10 and 11

 19 R2 paragraph 33

 20 R2 paragraphs 29 to 32

 21 R2 paragraph 33

 22   Evidence of Geoff Caddle R3 paragraph 17

 23   Evidence of Michael Caddle R4 paragraph 13

 24   Evidence of Michael Caddle R4 paragraph 12

 25   Evidence of Steven Hammer R2 paragraph 25

 26   For example, evidence of Michael Caddle R4 paragraph 8

 27 R1 paragraph 38 document M

 28 R2 paragraph 11; R3 paragraph 10

 29 R4 paragraph 7 and R1 document E

 30 R1 document F

 31 R3 paragraph 31

 32   Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport Print S5897 at 62 [(2000) 98 IR 137]

 33 R1 document M Non Conformance Report 10 December 2020

 34 R1 document N Non Conformance Report 5 February 2021

 35 R1 document K Non Conformance Report 29 January 2021

 36 R1 document L Non Conformance Report 3 February 2021

 37   Jones v Brite Services[2013] FWC 4280 at [24]

 38   Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371 as cited in Potter v WorkCover Corporation (2004) 133 IR 458 per Ross VP, Williams SDP, Foggo C and endorsed by the Full Bench in Industrial Automation Group Pty Ltd T/A Industrial Automation [2010] FWAFB 8868, 2 December 2010 per Kaufman SDP, Richards SDP and Hampton C at [36]

 39   Walton v Mermaid Dry Cleaners Pty Ltd(1996) 142 ALR 681 at 685

 40 [1995] HCA 24; (1995) 185 CLR 410 at 465 per McHugh and Gummow JJ

 41   [2013] FWCFB 6191

 42   [2011] FWAFB 1166 at 24

 43   [2018] FWCFB 1679 at 55

 44 Section 381(2) FW Act

 45   PR730553