Mrs Kerry Vince v Pro Health Care Kingswood Clinic Pty Ltd T/A Pro Health Care

[2018] FWC 2123

[2018] FWC 2123

FAIR WORK COMMISSION

DECISION

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

Mrs Kerry Vince
v
Pro Health Care Kingswood Clinic Pty Ltd T/A Pro Health Care
(U2018/1135)

DEPUTY PRESIDENT ANDERSON ADELAIDE, 16 APRIL 2018

Application for an unfair dismissal remedy – redundancy based dismissal – alleged small business employer - application filed out of time – claim of representative error – claim of ‘reverse synergy effect’ when dealing with multiple claims - no exceptional circumstances – application dismissed

[1] Kerry Vince has lodged an application with the Fair Work Commission (the Commission) under section 394 of the Fair Work Act 2009 (the FW Act) in relation to the termination of her employment with Pro Health Care Kingswood Clinic Pty Ltd (Pro Health Kingswood or ‘the employer’). Pro Health Kingswood operates a medical practice. It is one of a number of Pro Health clinics operating in Adelaide though the employer asserts each have their own ABN number and are not associated entities. That is a contested matter.

[2] Mrs Vince was dismissed on 15 December 2017 on the purported ground of redundancy, with immediate effect. She had worked for the employer as Practice Manager since 8 February 2016 (approximately 1 year 10 months). She was paid two weeks in lieu of notice and one week ex gratia in addition to her accrued entitlements.

[3] Mrs Vince claims her dismissal was not a genuine redundancy. She claims her dismissal was harsh, unjust or unreasonable. She seeks compensation.

[4] The application was the subject of a conciliation conference by a Commission-appointed conciliator on 6 March 2018. The matter did not resolve.

[5] Pro Health Kingswood raises three jurisdictional challenges. The employer says the application was lodged out of time and that no extension of time should be granted. It claims that the dismissal was a genuine redundancy (section 385(d) and section 389 FW Act). It claims that the employer is a small business employer and has complied with the Small Business Fair Dismissal Code (section 385(c) and section 389 FW Act). For each of these reasons it says that the application, if heard, would be dismissed without determining whether the dismissal was harsh, unjust or unreasonable and without considering remedy.

[6] This decision concerns one issue only: whether an extension of time should be granted for the late lodgement of the application so that it can proceed to a hearing and determination of the further jurisdictional issues and, if necessary, merits and remedy.

[7] Mrs Vince’s application was lodged with the Commission on 6 February 2018. That is 53 days after her dismissal took effect. Applications under section 394 of the FW Act must be made within 21 days. The application is 32 days out of time. The merits of Mrs Vince’s application cannot be heard and determined unless the Commission grants an extension of time. Pro Health Kingswood oppose an extension.

[8] On 16 March 2018 my Associate corresponded with both Mrs Vince and Pro Health Kingswood advising that the extension of time issue would be determined at a telephone hearing on 12 April 2018. Information about an extension of time under the FW Act was provided to the parties. Mrs Vince was directed to provide a witness statement and a copy of any document relied upon relevant to the extension of time issue by 3 April 2018. The employer was given an opportunity to file written material in response by 9 April.

[9] Written materials were lodged by Mrs Vince and by the employer in accordance with these directions.

[10] Although the parties preferred that the matter be simply determined on the papers, I conducted a hearing by telephone on 12 April 2018. I did so in order to adduce sworn evidence should factual matters be in dispute. A sound file recording of the hearing was made.

[11] Mrs Vince appeared and was represented by her husband Mr David Vince. The employer sought permission to be represented by a legal practitioner. This request was not opposed. I granted conditional permission on the ground that the efficient conduct of the hearing would be assisted if the employer was represented by the legal practitioner who prepared the employer’s materials and was familiar with the matter.

[12] At the hearing I heard evidence from Mrs Vince and from Mr Vince. Submissions were made by both Mr Vince and the representative of the employer.

[13] This decision is reached on the basis of all of the documentary and oral evidence and submissions before me.

The Legal Principles

[14] Section 394 of the FW Act relevantly states:

“394 Application for unfair dismissal remedy

…

(2) The application must be made:

(a) within 21 days after the dismissal took effect; or

(b) within such further period as the FWC allows under subsection (3).

(3) The FWC may allow a further period for the application to be made by a person under subsection (1) if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and

(b) whether the person first became aware of the dismissal after it had taken effect; and

(c) any action taken by the person to dispute the dismissal; and

(d) prejudice to the employer (including prejudice caused by the delay); and

(e) the merits of the application; and

(f) fairness as between the person and other persons in a similar position.”

[15] Mrs Vince’s application can only proceed to a full hearing and determination if she can establish that “exceptional circumstances” exist within the meaning of section 394(3). I have considered the provisions of section 394(3) as they apply to this matter in the context of the Full Bench decision in Nulty v Blue Star Group Pty Ltd 1 which stated:

“[13] In summary, the expression “exceptional circumstances” has its ordinary meaning and requires consideration of all the circumstances. To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. Circumstances will not be exceptional if they are regularly, or routinely, or normally encountered. Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. It is not correct to construe “exceptional circumstances” as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural “circumstances” as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of “exceptional circumstances” includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon.”

The Facts

[16] I make the following findings relevant to the extension of time issue based on the evidence before me. By and large these are uncontested findings.

[17] Mrs Vince had worked for the employer as Practice Manager since 8 February 2016.

[18] Mrs Vince was dismissed by the employer at a meeting on 15 December 2017. The reason given was redundancy. She was provided a written letter of termination. She was not entirely surprised by the redundancy. It had been foreshadowed to her a week prior, though its timing and terms were, at that stage, unknown. 2

[19] Her dismissal had immediate effect.

[20] Mrs Vince was paid two weeks in lieu of notice and one week ex gratia in addition to her accrued entitlements.

[21] Mrs Vince discussed the matter with her husband and close family members in the days and weeks that followed. She formed the view that there were valid reasons for the redundancy but that she wanted to press a claim for redundancy pay. 3

[22] On 27 December 2017 Mrs Vince wrote to the employer 4 thanking it “for the manner in which the process was undertaken” and “for the one week’s ex gratia” but asserting that she had a right to a four-week redundancy payment on the ground that the employer was not a small business employer. She sought an explanation in the event that her claim was disagreed.

[23] On 8 January 2018 the employer wrote to Mrs Vince rejecting the claim and asserting that it was a small business employer. It disputed that the Pro Health businesses were associated entities. Mrs Vince received this letter by post some time shortly after 10 January. 5 On 9 January she had emailed the employer following up her query6, and had received an email reply from the employer the following day (10 January) to the effect that a letter had been sent via post.7

[24] Until being notified of the unfair dismissal claim after it had been lodged on 6 February 2018, the employer heard no more from Mrs Vince after its letter of 8 January 2018 had been received by her. 8 Mr and Mrs Vince believed they had unlimited time to commence proceedings for a redundancy payment.9

[25] Following her dismissal Mrs Vince was taking advice from close family members being primarily but not exclusively her husband Mr David Vince. Mrs Vince’s evidence was that she took her husband’s advice but checked or questioned some of it as she was by nature less upbeat about being able to assert a redundancy pay entitlement. 10 Mr Vince has professional human resource capacity but no specific technical capacity in the fair work laws. He is employed as the HR Business partner in the Human Resources Division of the State Attorney-General’s Department.11

[26] Mr Vince was aware at all relevant times that a right to challenge a dismissal as an unfair dismissal could be made under the FW Act, and that such a claim, if made, would have to be lodged within 21 days. 12 This was information he conveyed to Mrs Vince. However, both Mr and Mrs Mr Vince were unaware of the fact that a redundancy could be litigated in the Commission as an unfair dismissal on the ground that it was said to be non-genuine. Mr Vince only became aware of this fact on 2 February 2018 when researching the fair work laws.

[27] Upon learning on 2 February 2018 that a redundancy could be litigated as an unfair dismissal an application was lodged four days later, on 6 February.

[28] Mr and Mrs Vince were during this period dealing with a second dismissal matter in their family. Their son Mr Chris Vince also worked at Pro Health Kingswood, as a casual employee. He resigned on 27 December 2017, the same day Mrs Vince made her redundancy pay demand. On 12 January 2018 Mr Chris Vince lodged an unfair dismissal in the Commission contending that his resignation was a forced resignation. He was assisted by his father Mr David Vince in preparing his application, and it was done with the knowledge of Mrs Vince. 13 The application by Mr Chris Vince was made within 21 days because at least Mr David Vince knew that applications for unfair dismissal needed to be lodged within 21 days.

[29] Since her dismissal, Mrs Vince secured alternative employment in late January 2018.

Consideration

[30] I now consider each of the factors set out in section 394(3) of the FW Act.

Reason for the delay (section 394(3)(a))

[31] Two reasons for the delay are advanced: firstly, representative error by Mr Vince and secondly, confusion created by what is said to be a ‘reverse synergy effect’ caused by dealing with multiple dismissals.

Representative Error

[32] It is clearly established on the facts that Mr Vince formed a view at all relevant times until 2 February 2018, wrongly as it turned out, that a claim arising out of a redundancy could not be litigated as an unfair dismissal. This view was imparted to Mrs Vince who adopted the same view.

[33] The long standing approach adopted by the Commission and its predecessors establishes that representative error may be an acceptable reason for a delay insofar as it may not be fair to visit the error of a representative on the applicant. 14 However, that approach requires that primary consideration must be given to the behaviour of the applicant to establish that an applicant took all appropriate steps to action the application and did not contribute to the delay.15

[34] This is not a case where the representative was at an arms-length professional relationship that made communication formal or difficult. The representative was Mrs Vince’s husband with whom she was in daily contact and dialogue. 16 She knew and had the ability to find out exactly what her representative was doing or thinking with respect to her rights. She also had the ability to inform herself of her rights, and to a limited extent did so in that she queried views being advanced by her husband and gave them her independent thought.

[35] Nor is this a case where the representative failed to implement an instruction from the applicant (such as an instruction to file proceedings). The error was a lack of knowledge about an alleged non-genuine redundancy being able to be litigated as an unfair dismissal.

[36] It is a well-established principle that mere ignorance of the law is not an exceptional circumstance. 17

[37] This explanation for the delay is genuine but in the context of the need to establish exceptional circumstances, unpersuasive. Both Mr and Mrs Vince knew inside the 21 day period that there were unfair dismissal rights under the FW Act, and Mr Vince (at least) knew that they were accompanied by a 21 day limitation. They simply did not know that her circumstance could enliven a claim. I accept that they were operating in good faith and on an incorrect presumption that a redundancy could only be prosecuted as an underpayment claim, not an unfair dismissal. However, that incorrect presumption was capable of being cured by independent advice or further research.

[38] I take into account that neither Mr nor Mrs Vince were legally qualified. Neither had technical capacity in the operation of the fair work laws. However they had capacity to inform themselves of her rights and were actively doing so. A reading of the unfair dismissal provisions of the FW Act or the Commission’s on-line information would have disclosed that redundancies can be litigated as unfair dismissals. This is not a hidden or inferential proposition. A specific section of the FW Act in the unfair dismissal division is devoted to the meaning of genuine redundancy.

[39] I also take into account that Mr and Mrs Vince were dealing with a stressful situation and that Mrs Vince particularly was at times confused and uncertain about the opinions being expressed by her husband and the best way to deal with her former employer. That said, the advice she took was from inside the family and amongst people with whom she could readily trust and communicate, and who could empathise with her circumstance.

Reverse Synergy Effect

[40] Mrs Vince says that the confusion about her rights was compounded by the fact that, at the same time, she and her husband were dealing with the desire to contest the manner in which her son came to cease his employment with the same employer.

[41] Mr Vince described this as a ‘reverse synergy effect’: 18

“Our requirement to research, establish and manage the processes of two matters together resulted in ‘reverse synergy effect’ where operating both was in fact more complex than would likely have been the case had either been initiated and progressed separately.”

[42] I readily accept that a family dealing with the fallout from a dismissal (or alleged dismissal) of both a mother and a son from an employer at around the same or a similar time is an unusual situation. I also readily accept that this can add to emotion and confusion, which the evidence suggests occurred in this instance.

[43] However, the evidence also suggests that the family had orderly albeit stressful discussions about both situations, as the need arose.

[44] Whether dealing with two issues at the one time created a collective degree of stress or confusion greater than the sum of its parts is not a matter I need to determine. I simply accept that it was uncommon that two family members were contemplating similar actions, and that it was stressful and at times confusing. Yet it is not uncommon that dismissed employees have to deal with more than one burden arising out of a dismissal, such as the burden of filing an unfair dismissal claim and seeking alternative employment, or the burden of filing an unfair dismissal claim and applying for social security benefits. It is well established that the presence of confusion or the existence of multiple proceedings is not, in and of itself, uncommon or exceptional. 19

[45] Nor does the existence of the second matter (involving Mr Chris Vince) does not weigh unequivocally towards a persuasive explanation for the delay. What the evidence also supports is that in discussing and considering the circumstances of Mr Chris Vince both Mr and Mrs Vince were aware of the right to make unfair dismissal claims under the fair work laws and, at least in the case of Mr Vince, that they had to be made within 21 days. These discussions occurred inside the period of 21 days from the date of Mrs Vince’s dismissal.

[46] Further, Mrs Vince’s letter of 27 December 2017 itself referred to “section 23 of the Fair Work Act 2009”. In other words, the fair work laws were being actively researched and referenced at that very time.

[47] In these circumstances, the reasons for delay are not persuasive and are factors that weigh against the granting of an extension.

Awareness of the dismissal taking effect (section 394(3)(b))

[48] The dismissal took effect on 15 December 2017. I have found that Mrs Vince was aware of that fact on that day. The letter of termination made this abundantly clear.

[49] On the facts in this case, I consider this to be a factor that weighs against granting an extension as it could not be said that Mrs Vince was unaware until a later date that her employment had ended.

Action taken to dispute dismissal (section 394(3)(c))

[50] Mrs Vince wrote to her former employer twelve days after her dismissal asserting a right to a redundancy payment and disputing the employer’s claim that it was a small business employer (and thereby not obliged to make a redundancy payment). Although Mrs Vince’s letter did not dispute the dismissal in the sense of challenging the genuineness of the redundancy, it put the employer on notice that there was a dispute over the terms on which she was dismissed. I also accept her evidence 20 that she queried this at the termination meeting with the employer on 15 December, and was provided a brief explanation. I consider this to be action taken to dispute the dismissal within the meaning of the FW Act.

[51] The action was relatively prompt after the dismissal, especially bearing in mind the Christmas / New Year period.

[52] On the facts in this case, I consider this to be a factor that weighs in favour of an extension of time being granted.

Prejudice to the employer (section 394(3)(d))

[53] As a general principle, an employer is entitled to arrange its affairs and organise its resources on the basis that claims of this nature can no longer be made beyond the lodgement period, except in exceptional circumstances. However, there is no evidence that Pro Health Kingswood is likely to be prejudiced on account of an application not having been made by the due date, given that Mrs Vince is not seeking re-employment and has secured alternative employment. A delay of this magnitude may have some impact on the recollection of events by witnesses although this matter does not appear, on the material before me, to involve a major contest on evidence or events.

[54] However, it is a principle well established by the Commission that the mere absence of prejudice is an insufficient basis to grant an extension. 21

[55] On the facts in this case, I consider this to be a neutral factor.

Merits of the Application (section 394(3)(e))

[56] Mrs Vince’s case appears to centre on two propositions – that she was not paid a redundancy payment she believes she was entitled to, and that the redundancy was not genuine within the meaning of the FW Act in that it would have been reasonable for her to have been redeployed.

[57] Each of these propositions bear a relationship to the two jurisdictional challenges foreshadowed by the employer – that the employer was a small business employer (and thereby under no obligation, it is said, to make a redundancy payment); and that the employer met the statutory definition of a genuine redundancy.

[58] In the absence of hearing evidence and submissions on these matters, I am unable to draw any conclusion about the merits of the further jurisdictional challenges or the application as a whole. It is nonetheless self-evident that if the jurisdictional points raised by the employer were successful they would strike at the basis on which the application is founded. If that were so, the application would not be able to proceed directly to a hearing on merit or remedy even if an extension of time were granted. These remaining jurisdictional matters would need to be first determined. If they were determined in favour of Mrs Vince, it is likely that proceedings on the merits would be simplified.

[59] On the facts in this case, I consider this to be a neutral factor.

Fairness between persons in similar position (section 394(f))

[60] No evidence or submissions from Mrs Vince or Pro Health Kingswood raise issues of fairness with and between other persons. The alleged dismissal, on the information before me, concerns Mrs Vince in her capacity as an individual employee.

[61] On the facts in this case, this is not a relevant factor.

Conclusion

[62] Given the statutory scheme in which unfair dismissal applications must be made within 21 days, the test of ‘exceptional circumstances’ establishes a “high hurdle” for an applicant for an extension. 22

[63] In considering whether exceptional circumstances exist, the conduct of Mrs Vince throughout the whole period after dismissal is relevant to whether an extension of time should be granted 23. However, no one factor is a condition precedent.24 I take into consideration all the relevant circumstances, because even though no one factor may be exceptional, in combination the circumstances may be such as reasonably to be regarded as exceptional.25

[64] In this matter the delay in lodgement is substantial, being 32 days. This is particularly so having regard to a 21 day statutory time limit. The delay in lodgement is late by more than the statutory time provided for the filing of applications. An application which was required to be filed within 21 days of dismissal was filed 53 days after dismissal.

[65] It was uncommon that, after 27 December 2017, Mrs Vince was also dealing with the fact that her son was taking advice from within the family about his unfair dismissal rights but, as noted, whilst this added to her stress it also produced a clear awareness of the existence of an unfair dismissal jurisdiction. In any event, Mr Chris Vince’s application was filed in the Commission on 12 January. A further 25 days elapsed before Mrs Vince’s application was filed.

[66] While I find that Mrs Vince moved promptly to put her employer on notice that there was a dispute about the terms of her redundancy, and while she moved very promptly to file the application once Mr Vince became aware that a redundancy could enliven an unfair dismissal application, the explanations do not adequately explain inaction across other periods of the delay. For example, Mrs Vince waited until 9 January before following up her letter of 27 December, explaining it in her evidence this way:

“No, no, not at all; we basically did nothing; we had some busy work to do as our son Chris became more of an issue than myself.”  26

[67] Once the employer’s reply was received (shortly after 10 January) no further contact was made with the employer. 27 Three to four further weeks passed before an application was prepared. Independent external legal advice was not sought. The matter continued to be handled inside the family.

[68] Ultimately this matter turns on whether Mrs and Mr Vince’s ignorance between the date of dismissal and 2 February 2018 that a redundancy could be litigated as an unfair dismissal is sufficient to meet the high hurdle of establishing exceptional circumstances. Given that ignorance of the law is not, as a rule, an exceptional circumstance and given that the fair work laws were under consideration by Mr and Mrs Vince over at least a portion of this period, in the circumstances, I have found the reasons for delay advanced to be genuine but not sufficiently convincing. The issue of representative error was collective ignorance of the law rather than a failure by an arms-length representative to take action which the applicant had authorised or instructed.

[69] Having regard to the length of the delay, which is substantial, and the factors set out in section 394(3) of the FW Act, I am not satisfied that exceptional circumstances exist so as to warrant an extension of time. The application will not proceed to a hearing on the remaining jurisdictional issues or the merits.

[70] Mrs Vince’s application is dismissed. An Order giving effect to this decision will be issued.

DEPUTY PRESIDENT

Appearances:

K. Vince, on her own behalf, and D. Vince, for the Applicant

M. Romaldi, with permission, for Pro Health Care Kingswood Clinic Pty Ltd

Hearing details:

2018.

Adelaide.

12 April.

Printed by authority of the Commonwealth Government Printer

<PR601971>

 1   [2011] FWAFB 7251. See also Cheval Properties Pty Ltd t/as Penrith Hotel Motel v Smithers[2010] FWAFB 7251 at [5]

 2   Mrs Vince Audio Transcript 12 April 2018, 38.45

 3   Mrs Vince Audio Transcript 12 April 2018, 39.00, 42.10

 4   Mrs Vince Audio Transcript 12 April 2018, 44.50 – 45.20; Statement of David Vince (3 April 2018) Attachment C (Letter of 27 December 2017)

 5   Mrs Vince Audio Transcript 12 April 2018, 52.35

 6   Mrs Vince Audio Transcript 12 April 2018, 49.10 – 50.00

 7   Mrs Vince Audio Transcript 12 April 2018, 50.35 – 51.25

 8   Mrs Vince Audio Transcript 12 April 2018, 53.45

 9   Mrs Vince Audio Transcript 12 April 2018 54.25

 10   Mrs Vince Audio Transcript 12 April 2018, 42.30 – 43.35, 45.50 – 46.30

 11   David Vince Audio Transcript 12 April 2018, 1.23.20 – 1.24.30

 12   Statement of David Vince (3 April 2018) paragraph 15; David Vince Audio Transcript 12 April 2018, 1.27.20

 13   Mrs Vince Audio Transcript 12 April 2018, 57.48

 14   Clark v Ringwood Private Hospital (1997) 74 IR 413

 15   Davidson v Aboriginal & Islander Child Care Agency Aboriginal Legal Service of Western Australia (Inc) (1998) 105 IR 1 at page 6

 16   David Vince Audio Transcript 12 April 2018, 1.29.10

 17   Nulty v Blue Star Group Pty Ltd [2011] FWAFB 7251 at [14]

 18   Statement of David Vince (3 April 2018) paragraph 31; David Vince Audio Transcript 12 April 2018, 1.19.55 – 1.22.50

 19   “It is not unusual for a person whose employment is terminated to pursue or continue with a worker’s compensation claim. Nor is it exceptional for a person whose employment has been terminated to be stressed or anxious.: Lombardo v Commonwealth of Australia as represented by the Department of Education, Employment and Workplace Relations[2014] FWCFB 2288 at [8]

 20   Mrs Vince Audio Transcript 12 April 2018, 37.00 – 38.00

 21 Brodie-Hanns v MTV Publishing Ltd (1995) 67 IR 298 at 299-300

 22   Lombardo v Commonwealth of Australia as represented by the Department of Education, Employment and Workplace Relations[2014] FWCFB 2288 at [21]

 23   Cheval Properties Pty Ltd (t/as Penrith Hotel Motel) v Smithers (2010) 197 IR 403 at 408-409

 24   Periklis Stogiannidis v Victorian Frozen Foods Distributors Pty Ltd t/as Richmond Oysters[2018] FWCFB 901 at [38]

 25   Ho v Professional Services Review Committee No 295 [2007] FCA 388 at [23]-[26] per Rares J

 26   Mrs Vince Audio Transcript 12 April 2018, 46.55 – 47.25

 27   Mrs Vince Audio Transcript 12 April 2018, 53.40 – 54.35