Mr William Patrick Ward v Arcadian Nominees T/A Instant Waste Management
[2009] FWA 609
•14 OCTOBER 2009
[2009] FWA 609 |
|
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
v
Arcadian Nominees T/A Instant Waste Management
(U2009/10991)
COMMISSIONER WILLIAMS | PERTH, 14 OCTOBER 2009 |
Termination of Employment.
[1] This application has been lodged by Mr William Patrick Ward who is applying for an unfair dismissal remedy under section 394 of the Fair Work Act 2009. The respondent employer is Arcadian Nominees T/A Instant Waste Management.
[2] The application was dealt with by a Fair Work Australia conciliator however the matter was not settled.
[3] A notice of listing with attached directions was provided to both parties on 11 September 2009 stating that the matter had been listed for a determinative conference on 9 October 2009. The directions explained that the conference was convened to decide whether the applicant was unfairly dismissed and required both parties to provide a written statement of evidence for each witness that they intended to rely upon. Those directions included a cautionary note that in the event that either party failed to comply with the directions the conference would proceed and the application would be decided on the basis of the materials filed in compliance with these directions.
[4] In compliance with the directions Mr Ward provided a witness state of his evidence.
[5] No witness statements were lodged by the respondent employer.
[6] On Friday 2 October 2009 at 11.18 PM a Mr Jarrad Green, the General Manager of the respondent e-mailed my chambers regarding the matter stating that “…he had to take leave…” and would not be back in the office until 14 October 2009 and requesting that another time and date be set for the proceedings.
[7] The following week on 6 October 2009 the applicant rang my chambers regarding the respondents adjournment request advising that he objected to the adjournment and that he and his wife had already made leave arrangements from their work to attend the conference.
[8] On Tuesday, 6 October 2009 at 10.11 AM the respondent was advised that the adjournment request had not been granted and the matter would proceed as previously listed.
[9] At the proceedings on 9 October 2009 Mr Ward was self represented and Mr Mangione appeared for the respondent. Mr Mangione is a Director of the respondent.
[10] The parties were given a further opportunity to have private discussions to see if the matter could be settled by agreement between themselves however following these discussions both parties advised me that they had not been able to reach agreement.
[11] Consequently I proceeded to hear and determine this matter.
The evidence
[12] Mr Ward provided sworn evidence as below.
[13] He was employed by Arcadian Nominees trading as Instant Waste Management on 19 January 2009.
[14] At the time of employment there was no stipulation of a required weekly sales quota, however some three months or so into his employment the respondent introduced a weekly sales quota. Mr Ward and others were advised verbally at a meeting of the increased expected target.
[15] After six months on 22 July 2009 Mr Jarrad Green the General Manager called Mr Ward into his office for a one on one meeting.
[16] Mr Ward says he was dismissed at this meeting and the reason given was that he did not reach the required sales target for June 2009.
[17] Mr Ward says that although he was not the only sales employee not to meet the required target, he was the only sales employee that was dismissed. The dismissal was effective immediately.
[18] Mr Ward says that he believes the reason the quota was not met was because Mr Green had not submitted a particular service agreement No. 0654 which he had provided to him earlier. This agreement represented almost 50% of his weekly sales quota.
[19] Prior to this meeting Mr Ward says he had never been informed either verbally or in writing that he had not met his weekly sales quota.
[20] Mr Ward's evidence was that if he had not been performing to the required level expected of him he would have valued the opportunity, through the company disciplinary process, to address this.
[21] As previously noted the respondent employer has not provided any witness statements in this matter.
[22] From the bar table Mr Mangione made a number of general observations about how the business operates to refute Mr Ward's evidence.
[23] Mr Mangione has been employed with the respondent for the last 10 years and is aware of the quota that is set for sales staff. He says there is a monthly management meeting where sales performances is discussed and Mr Green is involved in that meeting. The outcome of those meetings are minuted.
[24] Mr Mangione says he finds it astounding that Mr Ward was not aware of the sales quota in the way he says and that he was not performing to the necessary standard.
[25] Mr Mangione says that he believes Mr Green would have met with Mr Ward.
[26] Having heard Mr Mangione's statements from the bar table, Mr Ward also from the bar table reiterated that at no time had he been counselled by anyone about his performance and nothing had been provided to him in writing about his performance.
[27] The sworn evidence of Mr Ward in this matter is limited but specifically deals with the critical issues in an unfair dismissal matter such as this.
[28] The respondent in this matter has had an opportunity to provide specific sworn witness evidence but has not. The respondent has had an opportunity to challenge Mr Ward in cross examination but chose not to.
[29] Whilst I accept the statements of Mr Mangione were honestly made he has not provided any specific information to refute Mr Ward's evidence. Rather his statements from the bar table were broad generalisations about how the business operates, what he believes would have occurred, what he believes Mr Green might have done and what he believes Mr Ward should have been aware of.
[30] Having considered the evidence in this matter and the statements by Mr Mangione I accept the evidence of Mr Ward in full.
The legislation
[31] The relevant provisions of the Act are considered below.
s. 396 Initial matters to be considered before merits
FWA must decide the following matters relating to an application for an order under Division 4 before considering the merits of the application:
(a) whether the application was made within the period required in subsection 394(2);
(b) whether the person was protected from unfair dismissal;
(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;
(d) whether the dismissal was a case of genuine redundancy.
Was the application made within the period required?
[32] Mr Ward made this application on 4 August 2009 and his evidence is that he was dismissed on 22 July 2009. Consequently I'm satisfied that the application has been made within the period required in subsection 394 (2) being 14 days after the dismissal took effect.
Is the applicant protected from unfair dismissal?
s. 382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and
(b) one or more of the following apply:
(i) a modern award covers the person;
(ii) an enterprise agreement applies to the person in relation to the employment;
(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.
Note: high income threshold indexed to $108,300 from 1 July 2009
[33] The respondent advised that it has approximately 90 staff of which approximately half may be contractors. I'm satisfied then that the respondent is not a small business employer and so the minimum employment period applicable is six months. The evidence of Mr Ward is that he was employed for just over this period. The evidence of Mr Ward was that his salary was $55,000 per year with a $15,000 car allowance for using his own vehicle. Therefore I am satisfied that Mr Ward's annual rate of earnings was less than the high income threshold.
[34] Consequently I find that the applicant is protected from unfair dismissal.
Was the dismissal consistent with the Small Business Fair Dismissal Code?
[35] The respondent is not a small business employer so in terms of the definition in s. 388(2) the dismissal was not consistent with the Small Business Fair Dismissal Code.
Was this a genuine redundancy?
[36] The respondent has not asserted that the dismissal was a case of genuine redundancy.
[37] Having considered the initial matters I will now consider the merit of the application.
s. 385 What is an unfair dismissal
A person has been unfairly dismissed if FWA is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.
Has the applicant been dismissed?
[38] It is clear from the evidence and I find that the applicant has been dismissed.
Was the dismissal harsh, unjust or unreasonable?
s. 387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWA 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 FWA considers relevant.
[39] In this case there is no evidence that there was a valid reason for the dismissal related to Mr Ward's capacity or conduct.
[40] Mr Ward was notified of the reason for termination at the time of termination and it appears likely that at that meeting he did have an opportunity to respond to that reason.
[41] The issue of a support person being present did not arise.
[42] The dismissal did apparently relate to unsatisfactory performance from the respondent's perspective but on the evidence provided to Fair Work Australia, Mr Ward had not been warned about that unsatisfactory performance before the dismissal.
[43] Given the limited evidence provided, the size of the respondent's enterprise and its impact on the procedures followed in effecting the dismissal has no bearing on the determination in this instance.
[44] The evidence is that the respondent does not have dedicated human resource management specialists or expertise and so it may not be reasonable to hold the respondent to a very high standard in terms of procedural fairness. However here the respondent has terminated an employee on the grounds that their performance was unsatisfactory without any warning that the respondent was of the view that their performance was unsatisfactory and that continued poor performance may lead to termination. This approach by the respondent inevitably leads to a finding that regardless of the absence of human resource management specialists or expertise the respondent's actions were unreasonable.
[45] In conclusion then in this case there was no valid reason for the dismissal related to the applicant's capacity or conduct and the applicant was not warned about the supposed unsatisfactory performance before the dismissal occurred.
[46] That being the case I find that the dismissal in this instance was both unjust and unreasonable.
Was the dismissal consistent with the Small Business Fair Dismissal Code?
[47] The respondent at the time of the dismissal was not a small business so consequently the dismissal was not consistent with the Small Business Fair Dismissal Code.
Was the dismissal a case of genuine redundancy?
[48] There is no suggestion that this dismissal was a case of redundancy.
Was this an unfair dismissal?
[49] Having applied the tests provided for in s. 385 I am satisfied that the applicant in this instance has been unfairly dismissed.
Remedy
[50] The legislative provisions that deal with the remedy to be ordered are set out below.
Division 4—Remedies for unfair dismissal
s. 390 When FWA may order remedy for unfair dismissal
(1) Subject to subsection (3), FWA may order a person’s reinstatement, or the payment of compensation to a person, if:
(a) FWA is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) FWA may make the order only if the person has made an application under section 394.
(3) FWA must not order the payment of compensation to the person unless:
(a) FWA is satisfied that reinstatement of the person is inappropriate; and
(b) FWA considers an order for payment of compensation is appropriate in all the circumstances of the case.
Note: Division 5 deals with procedural matters such as applications for remedies.
[51] The pre-requisites provided in section 390 (1) and (2) for Fair Work Australia to exercise its discretion to make an order regarding a remedy have been satisfied.
[52] In this case Mr Ward has indicated that he does not wish to be reinstated. Mr Ward has also recently gained other employment. It is clear from the respondent's approach to this matter that the respondent for all their failings in communicating this to Mr Ward, were not satisfied with his performance. Consequently then I am satisfied that reinstatement of Mr Ward is inappropriate. Further I do consider that an order for payment of compensation is appropriate in the circumstances of this case.
[53] An order for the payment of compensation in lieu of Mr Ward's reinstatement can be made subject to the legislative considerations below.
s. 392 Remedy—compensation
Compensation
(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.
Criteria for deciding amounts
(2) In determining an amount for the purposes of an order under subsection (1), FWA must take into account all the circumstances of the case including:
(a) the effect of the order on the viability of the employer’s enterprise; and
(b) the length of the person’s service with the employer; and
(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and
(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and
(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and
(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and
(g) any other matter that FWA considers relevant.
Misconduct reduces amount
(3) If FWA is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, FWA must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.
Shock, distress etc. disregarded
(4) The amount ordered by FWA to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.
Compensation cap
(5) The amount ordered by FWA to be paid to a person under subsection (1) must not exceed the lesser of:
(a) the amount worked out under subsection (6); and
(b) half the amount of the high income threshold immediately before the dismissal.
Note: subsection 392(5) indexed to $54,150 from 1 July 2009
(6) The amount is the total of the following amounts:
(a) the total amount of remuneration:
(i) received by the person; or
(ii) to which the person was entitled;
(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and
(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.
[54] In this case Mr Ward has a short period of service a few days longer than six months.
[55] Mr Ward would have received his salary had he not been terminated. I do not believe it appropriate to have consideration however for the car allowance given that since the day of termination Mr Ward has not been required to use his vehicle for business purposes.
[56] A relatively short period of time has passed since the termination and Mr Ward has successfully mitigated his loss by gaining new employment.
[57] There is no evidence that Mr Ward has earned any income since the termination and in fact he is yet to be paid in his new employment. However it is expected that Mr Ward will soon be paid in his new employment and so this fact should be taken into account.
[58] The considerations in s.392 (3) to and including (6) are not applicable.
[59] Taking into account all these considerations above and the effect of an order of compensation on the viability of the respondents enterprise I believe an amount of compensation based on the salary that would have been earned by Mr Ward for the period between the day of termination and the day of hearing of this matter is appropriate.
[60] This period is that between 22 July 2009 and 9 October 2009. This equates to 11 weeks salary. Deducted from this should be an amount of two weeks which on termination was paid in lieu of notice. Consequently the amount of compensation to be paid is 9 weeks salary.
[61] The annual salary was $55,000 per year. Therefore the weekly salary was $1058.
[62] Consequently the amount of compensation I order to be paid by the respondent to Mr Ward is the amount of $9,522 gross which will be subject to taxation.
[63] An order to that effect will issue in conjunction with this decision.
COMMISSIONER
Hearing:
2009.
Perth:
October 9
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