Ms Cheryl Walker v Beachbreak Holidays T/A Ezyflights
[2012] FWA 10193
•3 DECEMBER 2012
[2012] FWA 10193 |
|
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Ms Cheryl Walker
v
Beachbreak Holidays T/A Ezyflights
(U2011/14216)
COMMISSIONER ASBURY | BRISBANE, 3 DECEMBER 2012 |
Application for unfair dismissal remedy.
BACKGROUND
[1] This is an application by Ms Cheryl Rosalie Walker seeking an unfair dismissal remedy in respect of her dismissal by Beachbreak Holidays T/A Ezyflights (Beachbreak). Beachbreak objected to the application on the grounds that Ms Walker was demoted without significant reduction in her remuneration or duties, and further contended that Ms Walker resigned her employment by not returning to work after completing two days in her new position. The jurisdictional objection on the ground of demotion was dismissed by another member of Fair Work Australia on the basis that Ms Walker was not employed by the employer at the time the objection was heard.
[2] The application was then allocated to me to determine whether Ms Walker was dismissed and whether the dismissal was harsh or unreasonable. Beachbreak maintained that Ms Walker was not dismissed and resigned her employment. Ms Walker contended that she was forced to leave her employment through conduct or a course of conduct engaged in by the employer, and that her dismissal was unfair. Ms Walker represented herself at the hearing and Beachbreak was represented by one of its Directors, Mr Jake Bruce.
LEGISLATION
[3] Legislative provisions relevant to the question of whether a person has been dismissed, are as follows:
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.
386 Meaning of dismissed
(1) A person has been dismissed if:
(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or
(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.
(2) However, a person has not been dismissed if:
(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season; or
(b) the person was an employee:
(i) to whom a training arrangement applied; and
(ii) whose employment was for a specified period of time or was, for any reason, limited to the duration of the training arrangement;
and the employment has terminated at the end of the training arrangement; or
(c) the person was demoted in employment but:
(i) the demotion does not involve a significant reduction in his or her remuneration or duties; and
(ii) he or she remains employed with the employer that effected the demotion.
(3) Subsection (2) does not apply to a person employed under a contract of a kind referred to in paragraph (2)(a) if a substantial purpose of the employment of the person under a contract of that kind is, or was at the time of the person’s employment, to avoid the employer’s obligations under this Part.
[4] By virtue of s.386, a person has been dismissed for the purposes of s.385, where employment is terminated by the employer or the person was forced to resign as a result of conduct or a course of conduct engaged in by the employer. As the Industrial Relations Court of Australia held in Mohazab v Dick Smith Electronics 1:
“...a termination of employment at the initiative of the employer may be treated as a termination in which the action of the employer is the principal contributing factor which leads to the termination of the employment relationship...plainly an important feature is that the act of the employer results directly or consequentially in the termination of employment and the employment relationship is not voluntarily left. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship.” 2
[5] In O’Meara v Stanley Works Pty Ltd 3a Full Bench of the Australian Industrial Relations Commission endorsed the need for the line distinguishing conduct that leaves an employee no real choice but to resign from employment and conduct that cannot be held to cause a resignation to be a termination at the initiative of the employer, to be closely drawn and rigorously observed.4 The Full Bench in O’Meara went on to state that the finding that a termination of employment was at the initiative of the employer requires that there be some action on the part of the employer which is either intended to bring the employment relationship to an end or has the probable result of bringing the employment relationship to an end.5 It is also the case that an employee who resigns and cannot establish any conduct on the part of the employer that constitutes repudiation of the contract, has not been dismissed.6
[6] If it is found that a person has been dismissed, in deciding whether the dismissal is unfair, Fair Work Australia must take into account the following criteria in s.387 of the Act:
(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.
[7] If it is found that a dismissal was unfair, the Tribunal must then determine whether the person should have a remedy for the unfair dismissal after considering the matters set out in Division 4 of Chapter 3 Part 3-2 of the Act. Those provisions are in the following terms:
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.
391 Remedy—reinstatement etc.
Reinstatement
(1) An order for a person’s reinstatement must be an order that the person’s employer at the time of the dismissal reinstate the person by:
(a) reappointing the person to the position in which the person was employed immediately before the dismissal; or
(b) appointing the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.
(1A) If:
(a) the position in which the person was employed immediately before the dismissal is no longer a position with the person’s employer at the time of the dismissal; and
(b) that position, or an equivalent position, is a position with an associated entity of the employer;
the order under subsection (1) may be an order to the associated entity to:
(c) appoint the person to the position in which the person was employed immediately before the dismissal; or
(d) appoint the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.
Order to maintain continuity
(2) If FWA makes an order under subsection (1) and considers it appropriate to do so, FWA may also make any order that FWA considers appropriate to maintain the following:
(a) the continuity of the person’s employment;
(b) the period of the person’s continuous service with the employer, or (if subsection (1A) applies) the associated entity.
Order to restore lost pay
(3) If FWA makes an order under subsection (1) and considers it appropriate to do so, FWA may also make any order that FWA considers appropriate to cause the employer to pay to the person an amount for the remuneration lost, or likely to have been lost, by the person because of the dismissal.
(4) In determining an amount for the purposes of an order under subsection (3), FWA must take into account:
(a) 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 reinstatement; and
(b) the amount of any remuneration reasonably likely to be so earned by the person during the period between the making of the order for reinstatement and the actual reinstatement.
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 395(5) indexed to $61,650 from 1 July 2012
(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.
393 Monetary orders may be in instalments
To avoid doubt, an order by FWA under subsection 391(3) or 392(1) may permit the employer concerned to pay the amount required in instalments specified in the order.
EVIDENCE/SUBMISSIONS
[8] Ms Walker gave evidence on her own behalf. Evidence on behalf of Beachbreak was given by Ms Dale Rowe, Bookkeeper/Administration Manager and Mr Jake Bruce, Director. It is not in dispute that Ms Walker was employed by Beachbreak from 15 January 2009, in various capacities. The uncontested evidence given by Ms Walker was that during the period of her employment she performed a range of duties and jobs, and was engaged on a number of bases as follows:
● 15 January 2009 - part time telesales consultant
● 10 February 2009 - full time permanent telesales consultant
● 14 April 2009 - promoted to Call Centre Supervisor responsible for training, motivation and support of sales staff, maintaining procedures, documentation, dismissals and other supervisory tasks with respect to 40 - 50 staff
● 4 May 2009 - entered into a contract specifying payment of commission on team sales
● 13 April 2010 - demoted from supervisory role and resumed work as telesales consultant following a complaint made by another employee
● 20 July 2010 - reinstated as Call Centre Supervisor and remained in this position until her employment ceased on 30 November 2011.
[9] Ms Walker gave evidence of being employed on a “TFN basis”. Ms Rowe also used the terms “ABN” and “TFN”. I assume that these terms are abbreviations of Tax File Number and Australian Business Number and that the terms are intended to differentiate between employees and independent contractors.
[10] A significant proportion of Ms Walker’s evidence related to her wages and related issues, not directly relevant to these proceedings. It is apparent that Ms Walker was dissatisfied with her remuneration and irregularities that she perceived with the manner in which it was paid. Ms Walker also contended that in approximately July 2011 Mr Bruce informed her that all staff would be required to obtain ABNs and work on that basis and that staff objected to this. Ms Walker said that she had a number of discussions with Mr Bruce during which she objected to being required to pursue such arrangements with persons who were employees of Beachbreak.
[11] Ms Walker also complained of the manner in which she was treated by Mr Bruce when she took leave, contending that she was berated for taking sick leave following major surgery and for the purposes of undergoing an emergency dental procedure. Ms Walker said that this conduct amounted to bullying. Ms Walker said that on 21 November 2011 she was called into the manager’s office for a meeting with Mr Steve Bruce and Mr Jake Bruce. She stated that she felt bullied at this meeting and both men were angry. They demanded that she obtain an ABN and work on that basis from the next day. Ms Walker said that she asked if they wanted her to resign, to which they replied “No.” Ms Walker also said that she felt she was being treated badly in order to force her into resigning.
[12] On 22 November 2011, Ms Walker was feeling upset and stressed. Ms Walker visited the doctor and received a medical certificate covering a four day absence from work. Ms Walker returned to work on 28 November, and said that she was called into a meeting where she was again bullied. Ms Walker said that she was demoted and all her supervisory responsibilities were removed. Ms Walker said that upon being told of her demotion she felt that she had been dismissed and requested that the offer in relation to her new role be put in writing. When the new offer was not provided to her in writing in the following days, Ms Walker left the workplace on 30 November 2012 and did not return. Ms Walker said that she did this because it was clear that she was not wanted at the workplace and her employment was untenable.
[13] Ms Walker tendered entries from her diary indicating that on Tuesday 15 November a temporary filling fell out of her large molar requiring her to make an appointment for root canal work on Thursday 17 November 2011. The entry for 18 November 2011 states that Ms Walker received 13 missed calls on her mobile telephone from Mr Shane Bruce between her departure from work at 4.10 pm and her arrival at home at round 6.10 pm. Ms Walker also records that she took a call from Mr Shane Bruce at 7.56 pm and was told that he could not afford to pay her and that she took too much time off. Ms Walker’s diary entry for Monday 21 November 2011 records a discussion with Mr Shane Bruce in relation to not answering her mobile telephone and a later discussion with Mr Jake Bruce and Mr Shane Bruce where she was told that the Company could not afford to pay her and that as of the next day she was “going on to an ABN status”.
[14] Ms Walker’s diary entries further record that she took sick leave from 23 November 2011 and returned to work on 28 November 2011. The entry records a discussion wherein Ms Walker was told that she could not cope with her work duties and that supervisory and management tasks were being removed from Ms Walker and assigned to Mr Bruce’s girlfriend. Ms Walker also records that she was told that she should get on the phone and sell, and that she asked for her terms and conditions to be put in writing.
[15] Under cross-examination Ms Walker denied that Mr Bruce verbally warned her that the Directors were not happy with her training methods but accepted that Mr Bruce verbally warned her that she wasn’t meeting the sales targets included in her supervisor contract. Ms Walker also accepted that she was not required to obtain an ABN, but maintained that she was told that this would be required. Ms Walker also maintained that there was no discussion of demotion and the reasons behind it at the meeting of 21 November 2011, and said that the discussion was purely about the wish of the Directors that she obtain an ABN and change her status as an employee to that of an independent contractor.
[16] Further, Ms Walker maintained that on 28 November 2011, after she returned from sick leave, she met with Mr Jake Bruce who berated her for taking sick leave and told her she was incompetent at her training job. Ms Walker conceded that she commenced other employment, on a temporary part-time basis, on 4 January 2012.
[17] Ms Walker submitted that her employment ceased as a direct result of the series of incidents that occurred in November 2011. In that period she was called into a number of meetings without warning, and was berated and reprimanded. She was not given the opportunity to have a support person present. On 28 November 2011 she was again berated and stripped of her supervisory duties. Despite her request for proposed new employment arrangements to be put in writing, this did not occur. Ms Walker submitted that conduct of the employer amounted to dismissal and that the dismissal was harsh, unjust and unreasonable as she was not given the opportunity to have a support person present during the dismissal-related discussions; she was not informed of the reasons for her dismissal or given the opportunity to respond; and was not given any warnings about the capacity/conduct issues that allegedly were the reasons for her dismissal.
[18] Ms Rowe said that Ms Walker was rude, intimidated staff and was difficult to work with. Ms Rowe also gave evidence that she was asked by Mr Jake Bruce to find out about the legal obligations associated with “stepping Cheryl down from a supervisor’s position back to a sales consultant” and had a telephone discussion with “a gentleman from Fair Work Australia” to seek such advice.
[19] Ms Rowe conceded that she was not a witness to any meetings between Ms Walker and the Directors of Beachbreak, but maintained that the meeting at which Ms Walker was informed of her demotion occurred on 15 November 2011. Ms Rowe said that Ms Walker worked for a couple of days in her new role on 28 and 29 November 2011 and then left the workplace and did not return. Ms Rowe said that she was instructed by Mr Bruce not to pay Ms Walker for those days until her position was clarified. Ms Rowe also gave evidence of attempts to contact Ms Walker by telephone to clarify her position. Ms Rowe said about a week after Ms Walker left the workplace she returned and held out her hand containing the office keys towards Ms Rowes’ face and walked away without saying anything.
[20] Ms Rowe agreed that some persons were working for Beachbreak “on ABN” including telephone sales staff. Ms Rowe also agreed that earlier in the year some sales staff instructed that their status would be changed from “TFN payment to ABN payment” but disagreed with the proposition that she told Ms Walker to ask those persons for their ABN and to tell them that their pay would be withheld if they did not provide an ABN. Ms Rowe said that if that question was going to be asked it would have been done by Mr Jake Bruce as he was responsible for employing staff.
[21] Mr Jake Bruce did not submit a witness statement but was permitted to adopt the written submission on behalf of Beachbreak as his evidence. According to Mr Bruce there were a number of reasons for demoting Ms Walker.
[22] Mr Bruce said that there were a significant number of complaints made by staff about Ms Walker. Ms Walker’s role was to provide training and assistance to staff and his preferred method of this was for her to be “on the floor” so she could give immediate answers and assistance to sales staff on calls. Mr Bruce said that he expressed this preference to Ms Walker on a number of occasions, but she refused to take this approach, and instead spent her time updating training manuals and not providing any assistance to staff except to advise them to ‘review the training manual’.
[23] Mr Bruce also said that Ms Walker was unable to work harmoniously with other supervisors and managers and that a number of staff had resigned due to the way that Ms Walker treated them. Mr Bruce described Ms Walker’s treatment of staff as intimidating and abrupt, and said that staff also complained of receiving incorrect information from Ms Walker. Mr Bruce said that he would receive “3 to 5” complaints per week about Ms Walker and that when he spoke to her about these Ms Walker would be defensive and refused to admit that she might be at fault.
[24] Mr Bruce said that Ms Walker did not follow direction from Managers/Directors, and insisted on training staff ‘her way’, despite direction from the Directors as to their preferred methods. Mr Bruce also asserted that Ms Walker was not adhering to conditions of employment and did not reach sales targets that had been agreed in the supervisor role. Mr Bruce said that all these reasons led the directors to the decision to demote Ms Walker back to her original sales role. Mr Bruce said that he had Ms Rowe check with Fair Work Australia to ensure all the requirements were complied with.
[25] Mr Bruce said that he met with Ms Walker on 14 or 15 November 2011 and explained the changes, which gave her 2 weeks’ notice in accordance with the advice obtained by Ms Rowe. After a week of sick leave, Ms Walker returned to the office on 29 November 2011 and commenced in the new sales only role. Mr Bruce also said that on 30 November 2011 he met with Ms Walker and explained the new role. Mr Bruce said that he told Ms Walker that the new role would be less stressful for her. He said that Ms Walker did not say much but he did not get the impression she was extremely unhappy and conceded that he could have misinterpreted Ms Walker’s silence. Further Mr Bruce said that the conversation ended with Ms Walker requesting information in writing about her new pay structure. Mr Bruce documented the structure but did not have an opportunity to give it to Ms Walker before she left the workplace.
[26] On the afternoon of 30 November 2011, Ms Walker left work 2 hours early without telling anyone, and did not return. Officers of Beachbreak attempted to contact Ms Walker multiple times that afternoon, and again the following day when she did not turn up for work. Mr Bruce asserted that the demotion did not result in a greatly reduced income for Ms Walker as the sales role increased the commissions she would earn.
[27] Mr Bruce said in his oral evidence that at no time did he attempt to change the status of Ms Walker to that of an independent contractor performing work under an ABN. Mr Bruce also said that he did not wish to dismiss Ms Walker.
[28] Under cross-examination Mr Bruce denied that the demotion meeting occurred on 21 November and that there was a second meeting on 28 November 2011. Mr Bruce later conceded that there may have been a conversation on 28 November 2011 where he would have reminded the Applicant that the notice was up and she was therefore to revert to the sales only role. Mr Bruce also conceded that in the meeting on 28 November he may have asked Ms Walker why she had been on sick leave. Further, Mr Bruce conceded that he did not provide advance warning of performance discussions to Ms Walker.
[29] In contrast with his evidence, Mr Bruce said in his submissions that he met with Ms Walker on 21 November 2011, together with Mr Shane Bruce to explain that Ms Walker was being demoted, and she was absent for the remainder of that week. Mr Bruce also said that he does not recall having a meeting with Ms Walker on 28 November 2011 and that Ms Walker attended work on 29 and 30 November 2011 and seemed happy in her new sales role.
[30] Mr Bruce said that Ms Walker was notified of the meeting about her demotion and did not request to have a support person present. Mr Bruce submits that while formal warning letters were not used, Ms Walker was made aware of the Respondent’s concerns regarding her performance and behaviour.
[31] Mr Bruce also maintained that Beachbreak did not want to dismiss Ms Walker and wanted her to remain as a sales employee. This role would not result in a pay decrease for Ms Walker.
[32] Payslips provided by Ms Walker for the period from 6 April 2011 indicate that she was paid a weekly rate of $1,100 gross. The payslips also indicate an hourly rate of $40 per hour.
[33] Ms Rowe said that the hourly rate of $40 was a default rate based on the MYOB system operated by the Company and that Ms Walker was paid a weekly salary of $1,100 per week regardless of the hours she worked.
[34] In his submissions on behalf of Beachbreak, Mr Bruce said that evidence indicates that Ms Walker was only without employment for approximately one month over Christmas. Mr Bruce further submits that Beachbreak was closed for 2 weeks of that period so Ms Walker would not have earned anything for those 2 weeks if she was still employed by Beachbreak. Mr Bruce also submits that at the end of Ms Walker’s employment, she was paid out 3 weeks of leave, which essentially only means she was unemployed for a period of one week.
[35] Further, Mr Bruce submits that the evidence shows that Ms Walker earns more in her new role than she did with Beachbreak and that she cannot demonstrate that she is entitled to any compensation under the Act. In relation to the allegations by Ms Walker of bullying, Mr Bruce submitted that he was not made aware of these at the time, and Ms Walker had not provided witnesses to any of the alleged bullying.
CONSIDERATION
Was Ms Walker Dismissed?
[36] I am satisfied that there was action on the part of Beachbreak that was intended to bring the employment relationship with Ms Walker to an end or had the probable result of bringing the employment relationship to an end. At the point Ms Walker’s employment relationship with Beachbreak ended, she was employed in a weekly (permanent) full time position as a Call Centre Supervisor and had held that position since July 2010. Although Ms Walker held a variety of roles during the period of her employment with Beachbreak, those roles were all weekly and at no time had Ms Walker been employed on a casual basis.
[37] It is clear from the evidence that there was a meeting at which Ms Walker was informed that there was to be a change to the basis of her employment. There is contradictory evidence about when the meeting at which Ms Walker was notified that she was to be demoted occurred. Ms Walker maintains that she was not informed that she was to be demoted until a meeting on 28 November 2011. Mr Bruce and Ms Rowe said that this meeting occurred on 14 or 15 November 2011.
[38] Ms Rowe’s evidence does not establish that there was a meeting with Ms Walker on 14 or 15 November 2011. All that Ms Rowe’s evidence establishes is that she sought advice at the request of Mr Bruce, about demoting Ms Walker. Further, Mr Bruce appeared to resile from his evidence that there was a meeting on 15 November 2011 to discuss Ms Walkers’ demotion, and stated in the submission for Beachbreak that the meeting was on 21 November 2011.
[39] On the basis that Ms Walker has maintained a diary to support her version of events, and the inconsistencies in the evidence of the witnesses for the employer about the dates upon which various meetings were said to have occurred, I accept the evidence of Ms Walker that there were two meetings, with the first being held on 21 November 2011 and the second on 28 November 2011, at which matters relevant to her employment were discussed.
[40] I also accept Ms Walker’s evidence about what was discussed at those meetings. Ms Walker was consistent with her evidence and did not waver in the face of cross-examination. Ms Walker’s evidence was also supported by diary entries which she said were made contemporaneously. Mr Bruce was not a convincing witness and altered his position on a number of matters in the face of Ms Walker’s evidence. It is also the case that the disputed meetings were also attended by Mr Shane Bruce who could have collaborated Mr Jake Bruce’s evidence. Mr Shane Bruce did not attend the hearing or provide a witness statement, and no compelling reason was advanced for his absence.
[41] In relation to Ms Walker’s assertion that she was told she would be required to obtain an ABN, I am of the view that it is more probable than not that the discussions on 21 November 2011 canvassed this matter. I have reached this conclusion because it is apparent from the evidence that such arrangements are used by Beachbreak as the basis for engaging at least some of the persons who perform work for the Company. Ms Rowe used short form terminology “ABN” and “TFN” to describe the type of arrangements under which work is performed at Beachbreak and is clearly familiar with such arrangements and the distinction between them. Ms Rowe also agreed that some employees are on “ABN” arrangements and that some sales staff were instructed that their status would be changed from “TFN” to “ABN”.
[42] Ms Rowe did not make clear in her evidence what advice she was given about the demotion of Ms Walker, and more significantly, what information she provided as the basis for the advice. What is clear is that the advice Ms Rowe received was that Ms Walker was entitled to two weeks’ notice and to be paid out her accrued annual leave entitlements before commencing her new “employment structure”. It is also clear that Ms Rowe’s view was that the basis of Ms Walker’s employment was to be changed from weekly to casual.
[43] It would be surprising if advice was given to the effect that a substantial change involving demotion from a supervisory role and a change from weekly (permanent) to casual employment, did not involve termination of employment and the creation of a new contract of employment. It is probable that advice to the effect that Ms Walker was entitled to the same notice of the change as would be required to terminate her employment, and to be paid out her accrued leave entitlements, recognised that such a change to the basis of her employment constituted a termination of employment.
[44] It is not relevant that Ms Rowe and Mr Bruce claim that they did not terminate Ms Walker’s employment, but rather “stepped her down” from the supervisory role, or that this was done in accordance with advice from “a gentleman from Fair Work Australia”. The effect of the demotion and the change from weekly to casual employment was the termination of Ms Walker’s employment contract by repudiation. Ms Walker accepted the repudiation when she left the workplace on 30 November 2011.
[45] I am also of the view that it is not to the point that Ms Walker’s status was not actually changed from that of an employee to that of an independent contractor. This was proposed at a meeting on 21 November 2011. At a further meeting on 28 November 2011, Ms Walker was told by Mr Bruce that she would no longer have a full time weekly (permanent) position as a Supervisor, but instead would be employed as a sales person on a casual basis. This was a fundamental change to her contract of employment. In my view, the result of that change was that the contract of employment was terminated. Accordingly, Ms Walker was dismissed.
[46] Even if it is accepted that Ms Walker resigned her employment when she left the workplace on 30 November 2011, this occurred in circumstances where the Directors of Beachbreak had repudiated her contract of employment by indicating their intention to force a substantial and significant change to the basis and status of that contract, and the effect of this can only have been heightened by the failure to provide Ms Walker with the details of that change in writing.
Was Ms Walker’s dismissal unfair?
Was there a valid reason for Ms Walker’s dismissal?
[47] I am unable to be satisfied that there was a valid reason for Ms Walker’s dismissal. A plethora of allegations about Ms Walker’s conduct and work performance including her interactions with colleagues, were set out in the material filed by Beachbreak in these proceedings. There is no evidence that any of these matters were raised with Ms Walker. Ms Walker does concede that the issue of her not making sales targets was raised verbally. However, there is no evidence that it was raised in such a way that Ms Walker could reasonably have formed the view that failure to improve her performance in this area would result in her dismissal.
[48] The failure on the part of Beachbreak to establish either through documentary or oral evidence that these matters were raised with Ms Walker in a way that she should reasonably have known that her employment was in jeopardy as a result of those matters, militates against a finding that they constituted a valid reason for her dismissal.
[49] There is also uncontested evidence from Ms Walker that Mr Jake Bruce and Mr Shane Bruce reacted with some hostility when she took sick leave or annual leave. Ms Walker provides details of unpleasant exchanges whereby she was quizzed about absences in circumstances including where she was undergoing surgery and an emergency dental procedure and had provided medical certificates to cover her absences. Mr Jake Bruce did not dispute this evidence and agreed that he had asked questions about the reasons for Ms Walker’s absences. There is also evidence that Mr Jake Bruce was of the view that the supervisory role was too stressful and that it would be easier for Mr Walker to revert to a sales position. None of these matters constituted a valid reason for Ms Walker’s dismissal.
[50] The evidence establishes that an employee with almost three years service in positions that were weekly (permanent) was informed that she was to be demoted from a supervisory role she had held for over a year, and that thereafter her employment was to be casual. For the reasons set out above, such fundamental and significant changes constituted a dismissal.
Was Ms Walker notified of the reason for her dismissal?
[51] On Mr Bruce’s own evidence, it is clear that he did not raise any of the matters set out in his evidence in these proceedings, prior to the dismissal of Ms Walker. Indeed, it appears that Ms Walker was not aware of matters relating to her conduct and work performance with which Mr Bruce took issue, until she received the material from Beachbreak in these proceedings. Accordingly, I am unable to be satisfied that Ms Walker was notified of the reason for her dismissal.
Was Ms Walker given an opportunity to respond to reasons related to her conduct or capacity?
[52] In circumstances where Ms Walker was not notified of the reason for her dismissal, I am not satisfied that she was given an opportunity to respond to reasons related to her conduct or capacity.
Support Person
[53] Ms Walker did not request that a support person be present at the interview to discuss the decision to demote her resulting in her dismissal. However, Ms Walker had no real opportunity to make such a request as she did not know in advance the subject matter of that meeting.
Was Ms Walker warned about any unsatisfactory performance?
[54] There is no evidence that Ms Walker was warned about any of the issues that Beachbreak relied on in order to justify what it viewed as her demotion. While there may have been discussions with Ms Walker about those matters, there is no basis upon which I could be satisfied that Ms Walker should reasonably have known that her employment was in jeopardy because the Directors of Beachbreak believed that her work performance was unsatisfactory. As a result, I am not satisfied that Ms Walker was warned about unsatisfactory work performance prior to her dismissal.
Size of Beachbreak’s enterprise
[55] The evidence about the exact number of employees of Beachbreak was not clear. However, it is clear that the company operates a computerised dialling system and has staff responsible for supervising telephone sales people. There was also reference to some of those sales people and a supervisor working night shifts. Further, a critical part of the supervisory role held by Ms Walker was training. These matters indicate that Beachbreak is at least a medium sized enterprise. There is no evidence about the likely impact of the size of Beachbreak’s enterprise on procedures followed in effecting the dismissal.
Absence of dedicated human resource management personnel
[56] Beachbreak does not have dedicated human resource management personnel. There is also no evidence about the likely impact of this on procedures followed in effecting the dismissal.
Other Relevant matters
[57] There are no other relevant matters arising from the evidence or submissions.
CONCLUSIONS
Ms Walker’s dismissal was unfair
[58] For the reasons set out above, I am satisfied that Ms Walker was dismissed. I am also satisfied that that dismissal was unfair because it was harsh, unjust and unreasonable. There was no valid reason for the dismissal. Ms Walker had a significant change to the status and basis of her employment forced upon her, in circumstances where she was not informed of the reasons for that change or given an opportunity to defend herself.
[59] If the Directors of Beachbreak had such serious concerns about Ms Walker’s capacity and conduct that they felt compelled to take such action, Ms Walker was not provided with details of those concerns so that she could respond to them. Further, if there were such concerns on the part of the Directors of Beachbreak, Ms Walker was not warned about those concerns and that her employment was in jeopardy.
[60] The Directors proceeded on the erroneous basis that they could unilaterally and without warning, determine that a full time weekly (permanent) employee, who held a supervisory position, could be “demoted” to a casual position and stripped of her supervisory responsibilities, without terminating her contract of employment. The rationale and the process followed by those Directors has resulted Ms Walker being unfairly dismissed.
Remedy
[61] Having decided that Ms Walker was unfairly dismissed, I have also come to the view that she should have a remedy for her unfair dismissal. In considering the relevant matters in s.390 of the Act, I am satisfied that reinstatement is inappropriate. Ms Walker has obtained other employment and does not seek reinstatement. I consider that an order for payment of compensation is appropriate in all of the circumstances of the case.
[62] In relation to compensation, Ms Walker contends that she was dismissed without notice one month prior to Christmas and was not paid for the two days she worked in the week prior to ceasing employment. Ms Walker stated that she was dismissed at a time of the year when telesales companies are not actively recruiting, and this is particularly so with respect to positions for supervisors and trainers. Ms Walker further stated that from 28 November 2011 to 3 January 2012 she had no income at all, and obtained a part-time casual position commencing on 4 January 2012, earning considerably less than she had been paid previously for the first three weeks.
[63] Bank statements tendered by Ms Walker indicate that on 10 January 2012 an amount of $326.22 was deposited into her account by her new employer, and that by 31 January 2012 that amount increased to approximately the level of wages she was paid by Beachbreak. Ms Walker estimates that she has lost approximately $7,500.00 in gross income and $900.00 in superannuation and seeks compensation in that amount.
[64] Considering the circumstances of the case, including the factors in s.392 of the Act, I have determined that Ms Walker should be compensated for her unfair dismissal by the payment of nine weeks wages at the rate of $1,100 per week.
[65] There is no evidence that an order for compensation will affect the viability of Beachbreak. Ms Walker has some three years service with Beachbreak. I am of the view that even allowing for the fact that Beachbreak had issues with Ms Walker’s work performance and was entitled to raise those issues, Ms Walker would have remained in employment for at least that nine week period, given that at the point she was dismissed she had not received any warnings in relation to her conduct or work performance.
[66] Had Ms Walker remained in employment for that period, she would have received an amount of $9,900.00. Ms Walker earned in respect of that period a total amount of $2,609.94 which should be deducted from the amount of compensation, giving an amount of $7,290.06. Given that the compensation I intend to award covers a nine week period from the date of Ms Walker’s dismissal, I make no further deduction for income earned during the period between the making of the order and the payment of compensation.
[67] It is relevant that Beachbreak closed down for a two week period during the 2011 Christmas period. Has Ms Walker remained in employment, she would have used two weeks of her accrued annual leave to cover this period. As this amount was paid to Ms Walker on termination of her employment, it should be deducted from the award of compensation in these proceedings so that a further amount of $2,200.00 is deducted from the amount of $7,290.06. There is no basis for reducing the amount of compensation for misconduct.
[68] Accordingly, I have determined that Ms Walker should be paid an amount of compensation of $5,090.06 less taxation at the appropriate rate. I have also determined that Ms Walker should receive superannuation contributions that would have been paid had she remained in employment, calculated on the basis of 9% of $5,090.06 or $458.10. An Order to this effect will issue with this Decision.
COMMISSIONER
Appearances:
Ms C. Walker on her own behalf.
Mr J. Bruce on behalf of the Respondent.
Hearing details:
2012.
Brisbane:
August 21.
Final written submissions:
10 September 2012
1 (1995) 62 IR 200
2 Ibid at 205-206.
3 Print 973462, 11 August 2006.
4 ABB Engineering Construction Pty Ltd v Doumit Print N6999, 9 December 1996.
5 O’Meara v Stanley Works Pty Ltd PR973462.
6 Gunnedah Shire Council v Grout (1995) 134 ALR 156; Richardson v Inghams Enterprises Pty Ltd [2008] AIRC 1117.
Printed by authority of the Commonwealth Government Printer
<Price code C, PR531956>
0
2
0