Mrs Linda Kaur v Services Management International Pty Ltd T/A SMI Security Group
[2011] FWA 2295
•14 APRIL 2011
[2011] FWA 2295 |
|
DECISION |
Fair Work Act 2009
s.394—Application for unfair dismissal remedy
Mrs Linda Kaur
v
Services Management International Pty Ltd T/A SMI Security Group
(U2010/14388)
COMMISSIONER SMITH | DARWIN, 14 APRIL 2011 |
Termination of employment; compensation awarded.
INTRODUCTION
[1] Ms Linda Kaur has made an application pursuant to s.394 of the Fair Work Act 2009 (the Act) alleging that her employment with SMI Security Group (SMI) was terminated harshly, unjustly and unreasonably. In accordance with s.396 of the Act I find that the application was made within the period required and that the person was protected from unfair dismissal. Sections 396(c) and (d) of the Act do not apply.
[2] At the commencement of the matter before me on 8 April 2011, I conferred with the parties in accordance with ss.398 and 399. As a result of that consultation it was agreed that I would firstly see if the matter could be resolved by way of a conference which explored options. Regrettably this did not produce an agreed outcome and it was decided that a hearing with sworn evidence would be the most effective and efficient way to resolve the matter.
[3] Ms Kaur was a senior security guard for SMI and was located at Melbourne Airport where SMI had a contract to provide security services for Australian Air Express (AAE).
[4] Ms Kaur was employed by SMI on 20 April 2006 and was summarily dismissed for misconduct on 22 November 2010. She had over five years service and there is no evidence (except for the events surrounding her dismissal) that she was other than a reliable and conscientious employee.
[5] SMI describes itself as:
“S.M.I. Security Group is a wholly owned and operated Australian company. S.M.I. currently employs over 190 Security Officers and operate predominantly in Victoria and Tasmania.
Since its inception, S.M.I. Security Group has experienced steady growth in all sectors of the business, especially Guard Services and Mobile Security Patrol Services. In November 2006, S.M.I. commenced operating a Mobile Security Patrol Service.
The S.M.I. Security Group Management Team have over 60 years combined experience in the Security Industry. Our knowledge of the Industry spans from Tertiary Education, Shopping Centres, Aviation, Office Buildings to Security Transport, Mobile Security Patrols and Security Training. Each member of our Management Team has specialised in these different sectors of the Security Industry throughout Australia, over a 35 year period.” 1
[6] In the proceedings Ms Kaur represented herself and SMI was represented by two of the Directors, Mr M Lombardo and Mr J Lombardo. Given that both parties were unrepresented it was necessary to assist with procedures and approach so that each party was able to put forward their best case.
BACKGROUND
[7] Ms Kaur, having been appointed in April 2006, was promoted to the position of senior guard in June 2009. She has been in that position since that time. Her duties involved scanning or using an X-ray machine to ensure that freight was safe to load onto aircraft. Her most common duty was to use a wand and itemiser to detect any explosive materials in freight. This procedure is regulated by both federal and international laws. In circumstances where no explosive is detected then the guard is required to place a green “Security Checked” sticker on the freight.
[8] On Thursday 18 November 2010, the general manager—security of AAE was in attendance at the site and made a report that he witnessed a guard not carrying out the correct security procedures. He advised SMI that some freight was scanned but there were no signed security stickers on the freight. This was of great concern to AAE as it could be heavily fined for failing to comply with the relevant laws. In evidence, it was said that the general manager—security of AAE was very concerned and upset over the incident and could not believe that it happened when everybody knew he was on site.
[9] Ms Kaur was contacted on that day and invited into an interview so that her version of events could be ascertained. Ms Kaur submitted that she had been with another guard and they had divided the responsibilities. She would “wand” the freight and then walk to the room where the testing equipment was located and then signal the other guard that all was clear and she expected him to apply the stickers.
[10] The other guard, Mr P Turnley was also interviewed. Mr Turnley was not called to give evidence.
[11] What was also put to Ms Kaur was that she also asked Mr Turnley to affix stickers and to put her initials on those stickers as having been checked by her. In addition, Ms Kaur was asked about the number of security stickers that were left over in the room when the policy was to destroy those stickers.
[12] Ms Kaur was interviewed on 18 November and again on 22 November when it was decided that the conduct of Ms Kaur was so serious that she was summarily dismissed.
THE EVIDENCE
[13] Essentially the evidence from Ms Kaur was that she was acting in a way that she had always acted. Namely, using the second guard to assist with the security inspection as this saved time when shipments were arriving regularly. Ms Kaur stated that she checked all the freight in line with policy; that is, individual items have stickers affixed and bulk items which have wrapping around them only need one sticker. She offered an explanation for some items not having security stickers as it must have been as a consequence of unpacking a single batch so that the contents could fit into the container. Ms Kaur added that she did not ask Mr Turnley to sign her initials and that she affixed stickers in the appropriate way.
[14] As to the leftover security stickers, Ms Kaur stated that this was a practice which was encouraged so that stickers were not wasted.
[15] The evidence from Mr M Lombardo was that there are very strict domestic and international laws about checking freight and that Ms Kaur’s failure to do so properly was a very serious matter. As the senior guard it was her responsibility to ensure that all freight was checked and that proper procedures were followed. This was particularly so given the international incident where two explosives were found on Cargo planes bound for the United States from Yemen.
[16] Mr Lambardo’s evidence was that he, together with Mr Lalith Udugampala and Mr Rimon Hannania, conducted the first interview with Ms Kaur where all the allegations were put. It was decided at that interview to conduct an interview with Mr Turnley and this was done by Mr Udugampala and Mr Hannania on the next day. It was the evidence of Mr Udugampala that in his interview with Mr Turnley he was told that Ms Kaur did ask Mr Turnley to forge her initials but that he refused to do so and signed his own name.
[17] Mr Udugampala stated that he discussed the matter with Mr Lambardo and concluded that Mr Turnley had a good appreciation of AAE policy.
[18] Before the final meeting with Ms Kaur, it was the evidence of Mr Lambardo that he investigated the matter by checking the CCTV footage where he found that Ms Kaur did not put security stickers on all the scanned freight and on other occasions where she had put stickers on, she had not dated or signed them. At the final meeting Mr Udugampala stated that Ms Kaur believed that she had done nothing wrong.
[19] It was also the evidence of Mr Udugampala that AAE had been advised of the outcome of the investigation and that it requested that she be removed from the site and not be permitted to return.
THE ACT AND CONCLUSION
[20] In considering applications pursuant to s.394 attention must be given to s.387 which provides:
“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.”
[21] I turn firstly to 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). I am persuaded that there was a valid reason relating to Ms Kaurs’ conduct.
[22] I find that Ms Kaur did not scan all freight items and did not sign some “security checked” stickers. I make no finding about whether or not Ms Kaur should have destroyed unused stickers as her explanation had a ring of truth but there was insufficient evidence.
[23] Ms Kaur had received training on the correct procedures for scanning outgoing freight and she was aware of the importance of undertaking this task diligently. Whilst I understand the importance of scanning freight and the possible consequences of a failure to carry out this task properly, this is true of many occupations. On the evidence, Ms Kaur stated that her work practice had not changed and that in particular the practice of saving unused “security checked” stickers was commonplace so that they were not wasted. However, the evidence and submissions of SMI was that this must have been a one-off occurrence because there are systems in place which would detect such failures.
[24] The question which needs to be answered is: if I accept the employer’s view, should a one-off incident of this nature carry with it the penalty of instant dismissal for misconduct? It is appropriate to accept the employers view as that was the information in its possession at the time of termination of employment and that Ms Kaur’s evidence about her work practice would not be possible because of the checks inherent in the systems [on the employer’s view.]
[25] It has been stated that misconduct connotes action which is ‘so seriously in breach of the contract that by standards of fairness and justice the employer should not be bound to continue the employment.’ 2 Whilst it is not necessary to establish that the conduct was so serious as to justify summary dismissal at common law,3 nevertheless the impact of a summary dismissal is a matter that can be taken into consideration:
“Employers can promulgate policies and give directions to employees as they see fit, but they cannot exclude the possibility that instant dismissal of an individual employee for non compliance may, in the particular circumstances of an individual case, be harsh, unjust and unreasonable” 4
[26] This approach was adopted by the Australian Industrial Relations Commission 5 and in my view it remains good. The same can be said of the approach in Windsor Smith v Liu & ors6 where it is clear that the fact that there is a valid reason does not mean that the termination cannot be harsh, unjust or unreasonable.
[27] Whilst I accept there was a valid reason, I have concluded that the termination was harsh. Ms Kaur was an employee with just over five years service and had not been warned or counselled about her work performance. She had originally been employed as a casual but was quickly made a full-time employee and then promoted to a senior guard.
[28] There was no evidence of consideration being given to a possible transfer within the business of SMI. It appears to me that whilst the failures of Ms Kaur were important, the direction by AAE that Ms Kaur be removed from the site and not be returned appeared to also be a strong factor. It was submitted that if SMI lost the AAE contract that would have a very serious, perhaps fatal, impact on its business. I do not underestimate the persuasiveness of such a direction by a client. I have also taken into account the allegation that Ms Kaur asked Mr Turnley to put her initials on a security sticker. The only direct evidence about this matter is that of Ms Kaur who rejects the allegation. Although I have no reason to doubt Mr Udugampala’s evidence, that is what he was told by Mr Turnley. I have taken this into account when determining the relief.
[29] Returning to the requirements of the Act, I find that Ms Kaur was notified of the reason for her termination.
[30] The next consideration is whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person. Against the background of the evidence I find that she was given such an opportunity.
[31] There is no evidence that Ms Kaur was given an opportunity to be represented and she asserts that she was not advised that she could be represented. I also find, having regard to s.387(e) of the Act that Ms Kaur had not been warned for poor work performance.
[32] In relation to the operation of ss.387(f) and (g) I am not critical of the employers approach to the investigation and consideration of the circumstances.
[33] Finally, I must consider if there are any other matters than FWA considers relevant. In this regard I propose to take into consideration the statement made by the client of SMI that it wanted Ms Kaur removed from the site and not returned. The control of the client over a worksite in which contractors are engaged is an important matter although it is not determinative of whether or not reinstatement is ordered. 7
[34] Having found that the termination of employment of Ms Kaur was harsh I now turn to consider remedy. Section 309(2) provides that FWA must not order compensation unless it considers that reinstatement of the person is inappropriate and that an order for payment of compensation is appropriate in all the circumstances. I have formed the view that reinstatement is inappropriate. I do so for two main reasons. Firstly, Ms Kaur maintained, at the time of the interview and in the hearing of the matter, that she had done nothing wrong. There was no recognition on her part that, even if she had always performed her duties in the way she described, her training and the requirements of the role of the senior guard meant that her duties had to be performed in the way described by SMI. Secondly, the attitude of AAE about her returning to the worksite, together with the risk that might pose to the contract held by SMI to provide a security service. This would not be a consideration if a resolution of the evidence meant that the conduct complained of did not occur but in this case the concern of the client was real and significant.
[35] Therefore I now turn to what compensation, if any, should be awarded. In this connection s.392 determines matters which should be taken into consideration.
“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.
(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.”
[36] Nothing has been put which would mean that if compensation was awarded it would impact upon the viability of the employer’s enterprise. Therefore this criterion does not impact upon any consideration of compensation. The next matter relates to the employees length of service. A period of service of just over five years is not long but not insignificant. This is particularly so when consideration is given to the fact that performance and conduct were not criticised during this time.
[37] In considering the amount of the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed [s.392(c)], I believe that Ms Kaur may not have worked longer than three months. This judgement is based upon the evidence of SMI that she did not exhibit any understanding of her failings and continued to take the view that she had done nothing wrong. As stated earlier, even if it was demonstrated that SMI had not properly managed the situation which had permitted lax processes to occur, then Ms Kaur should have recognised this and accepted that what occurred was not consistent with her previous training and the rules governing the handing of airfreight.
[38] As for her efforts to mitigate the loss suffered because of the dismissal [s.392(d)] Ms Kaur gave evidence that she has another security job and has earned between $5,000 and $6000 dollars since her termination [s.392(e)]. It was the evidence of Ms Kaur that she obtained other employment in February 2011. At the time of her termination she was earning, she says, about $800 a week. Given that she was dismissed on 22 November and I estimate that she would have worked for a further three months that would take her likely dismissal date to 22 February 2011—some 13 weeks. In other words she would have earned approximately a further $10,400. I will take the midpoint of her estimated earnings and deduct $5,500, leaving $4,900. Given the time I estimated that she would have been employed I make no estimate of 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 [s.392(f)].
[39] Section 392(3) requires that a deduction is made 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. In this case there was misconduct but not, in my view, with such gravity as to warrant summary dismissal. I shall reduce the amount by a further $1,600 which equates to two weeks pay for Ms Kaur.
[40] This leaves an amount of $3,300. I don’t propose to deduct any further amounts and this amount is clearly within the cap stated in s.392(5) of the Act. An order reflecting this decision is attached.
COMMISSIONER
Appearances:
L Kaur the applicant.
M Lombardo on behalf of Services Management International Pty Ltd trading as SMI Security Group.
Hearing details:
2011.
Melbourne:
April, 14.
1 North v Television Corporation Ltd (1976) 11 ALR 599 per Smither and Evatt JJ
3 Annetta v Ansett Australia (2000) 98 IR 233
4 Bostik (Australia) Pty Ltd v Gorgevski (No 1) per Sheppard and Heerey JJ (1992) 41 IR 452 at 460
5 Fearnley v Tenix Defence Systems Pty Ltd, Ross VP, Polites SDP and Smith C, Print S6238
6 Print Q3462
7 [2010] FWA 1129
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