Mr Wei Ping Chen v Frontal Pty Ltd T/A Rico Furniture Company

[2012] FWA 10499

[2012] FWA 10499

FAIR WORK AUSTRALIA

DECISION

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

Mr Wei Ping Chen
v
Frontal Pty Ltd T/A Rico Furniture Company
(U2012/13506)

SENIOR DEPUTY PRESIDENT HAMBERGER SYDNEY, 19 DECEMBER 2012

Application for unfair dismissal remedy; high income threshold; whether employment was terminated at the initiative of the employer.

[1] Mr Chen (the applicant) filed an application for an unfair dismissal remedy on 26 September 2012. The respondent (Frontal Pty Ltd, trading as Rico Furniture) filed a jurisdictional objection that the applicant had not been dismissed, and that he was was not a person protected from unfair dismissal, as the sum of his annual rate of earnings, together with other relevant amounts paid on his behalf, were above the high income threshold ($123,300). The respondent also objected that if the applicant had been dismissed, his application was filed outside the 14 day lodgement period.

[2] A hearing was conducted to deal with these jurisdictional issues on 7 December 2012. At the hearing, the applicant was represented by Mr P. Rochfort, and the respondent by Mr J Zervos, of the Furnishing Industry Association of Australia. During the hearing evidence was given on behalf of the respondent by Mr William Sun and Ms Kim Chapman. The applicant gave evidence on his own behalf.

The evidence

[3] This matter largely turns on the differing factual accounts given by the witnesses. I should indicate at the outset that I did not find the applicant a credible witness. His responses in relation to important matters were vague. 1 He was evasive about a number of matters, including his status with the respondent2 and his activities on and around 5 September 2012. The respondent’s witnesses, by contrast, gave their evidence in a clear and compelling fashion. Where there is a conflict I prefer the evidence of the respondent’s witnesses to that of the applicant.

[4] Mr Chen was a Director and Company Secretary of the respondent from its incorporation as a company in 1996 until his removal as a Director on or about 21 September 2012. Ms Deng, Mr Chen’s wife, was also a Director of the respondent. Mr Sun is a general manager of the respondent, as was Mr Chen 3. I am satisfied that until 6 September 2012 both Mr Chen and Mr Sun had responsibility for the day to day operations of the respondent4.

[5] When the respondent’s business was originally established, Mr Chen was largely responsible for its running. 5 Both men have at various times been described as Managing Director of the company6. Mr Chen was primarily responsible for the logistics aspect of the operation7. Mr Sun was primarily responsible for sales and marketing.8 In more recent times Mr Chen started neglecting certain parts of the work, and Mr Sun took greater responsibility.9

[6] I am satisfied that during August 2012 Mr Sun raised the issue of unreconciled credit card expenses with Mr Chen. Mr Sun alleged that the statements for Mr Chen’s company credit cards showed expenses that did not relate to any legitimate business use 10. He told Mr Chen that he needed to reconcile and appropriately administer these expenses or reimburse the respondent if they were for personal use. The issue was raised again on 4 September 2012 when Mr Sun emphasised that Mr Chen had to reimburse the company for private expenses incurred on the company credit cards.11 Mr Chen said he needed to contact a friend who could lend him the money. He then said he would leave work early that day and return on 5 September 2012. However he failed to return on 5 September. It is clear from his mobile phone records that he had flown to the Gold Coast and was at Jupiter’s Casino12. He eventually came into the office on 6 September 2012. Mr Sun confronted him about his gambling and said he needed to seek help. Mr Chen said to Mr Sun words in Mandarin to the effect of “Your idea is right. I can’t work here”.13 He left the office, though he came back later that night to sign a cheque. He has not returned to the office since then.14 After the conversation on 6 September 2012, Mr Sun had no further contact with Mr Chen. He received no responses to any of his attempts to contact Mr Chen until 4 October 2012 when he received a communication from Mr Rochfort.

[7] As an employee of the respondent, Mr Chen was paid $1,325 per week ($68,900 per annum). Mr Chen also received the unconditional use of a fully maintained company vehicle with an estimated annual value of $15,000 per annum. An amount of $975 was also paid weekly into the nominated bank account of his wife, Ms Deng 15 (equivalent to $50,700 per annum).

[8] According to Mr Sun the respondent issued annual group certificates to Ms Deng as part of an arrangement with Mr Chen, presumably to minimise taxation. The group certificates were either signed by Mr Chen, or by an officer of the company at Mr Chen’s direction.

[9] Ms Chapman is the National Sales and Marketing Manager of the respondent. She commenced employment with the respondent in 1996. She was hired by Mr Chen and Mr Sun. For most of this period, she reported to Mr Chen. 16 Ms Chapman’s evidence was that Ms Deng was not and has never been an employee of the respondent.17 Mr Rochfort referred to some documents which he claimed had been prepared by Ms Deng. He sought to put these to Ms Chapman and suggested they showed that Ms Deng may have done work for the company, of which she may have been unaware. These documents were never filed as evidence. Nor was Ms Deng called as a witness, despite being present at the hearing. I am satisfied, based on the evidence, that Ms Deng was not an employee of the respondent. Rather the $975 paid weekly into her bank account was an amount directed by Mr Chen on his own behalf18.

Conclusion

[10] I am satisfied that Mr Chen abandoned his employment on 6 September 2012. He was not dismissed by the respondent.

[11] I am also satisfied that Ms Deng was not an employee of the respondent. The amount of $975 paid weekly into her bank account was in reality an amount paid on behalf of Mr Chen, and should be included in assessing his income for the purposes of the high income threshold. Taking into account the money paid to him directly, and the value of the company car, his income was above the high income threshold.

[12] In accordance with both these findings, Mr Chen’s unfair dismissal application is dismissed.

SENIOR DEPUTY PRESIDENT

Appearances:

P Rochfort, for the applicant

J Zervos, for the respondent

Hearing details:

2012

SYDNEY

7 December

 1   See for example: PN868

 2   PN918-936

 3   PN37

 4   PN 38-9

 5   PN 654-657

 6   PN704 and PN723

 7   PN159

 8   PN218

 9   PN671

 10   PN49-53

 11   PN60

 12   Exhibit R2

 13   PN288-90

 14   PN75

 15   Exhibit R1

 16   Exhibit R6

 17   PN642 - 644

 18   Exhibit R1

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