Ms Christine Dixon v Orsino Images Pty Ltd T/A Orsino Images, Wedding Movies, Godwin Pictures

[2011] FWA 6919

[2011] FWA 6919

The attached document replaces the document previously issued with the above code on 7 October 2011.

An error has been corrected in paragraph 3 and the appearances.

Melissa Nassios

Associate to Commissioner Roe

Dated 19 October 2011

[2011] FWA 6919

FAIR WORK AUSTRALIA

DECISION

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

Ms Christine Dixon
v
Orsino Images Pty Ltd T/A Orsino Images, Wedding Movies, Godwin Pictures
(U2011/989)

COMMISSIONER ROE MELBOURNE, 7 OCTOBER 2011

Termination of employment- genuine redundancy or dismissal at initiative of employer.

[1] This matter arises from an application filed on 17 May 2011 under s 394 of the Fair Work Act 2009 (the Act) by Ms Christine Dixon (the Applicant) for relief in respect to the termination of her employment from Orsino Images Pty Ltd T/A Wedding Movies (the Respondent).

[2] Following an unsuccessful conciliation conference the matter proceeded to arbitration. The parties elected to proceed to a hearing. Directions were issued by Fair Work Australia and the matter was heard on 6 October 2011.

[3] At the hearing the Applicant represented herself and was assisted by her father Dr Raymond Dixon. The Respondent was represented by Mr Ben Whimpey, a Director of the company. Evidence was given by the applicant 1 and by Mr Charles Beck,2 who had worked for the company as an editor and then as general manager. Evidence for the Respondent was given by Mr Whimpey,3 and another Director of the company, Ms Li Mei Glover.4

[4] Mr Beck gave evidence that his role was that of General Manager throughout the period of the Applicant’s employment. I accept his evidence that the Applicant was employed from 1 November 2008. The role performed by Mr Beck changed from early 2011 when Mr Whimpey, who was the owner of the business, took on two new Directors Mr Tim Glover and Ms Li Mei Glover. The administration roles performed by Mr Beck were largely taken over by one of the new Directors, Ms Li Mei Glover. Mr Beck gave notice of resignation on 28 March 2011 and his last day of employment with the company was 22 April 2011. There was overwhelming evidence that following the engagement of the two new directors there were significant changes in the business, starting from January 2011 and culminating in the ending of the employment of Mr Beck and the Applicant in April/May 2011.

[5] The Applicant was first employed in November 2008 performing editing work on wedding videos. Her role and duties were formalised in a contract in June 2009. Her duties were to solicit and finalise contracts with potential clients for wedding videos, promote the business at wedding expos, and manage a potential client database. Her hours were up to 12 per week and her engagement was described as casual. 5 However, it is not contested that during this period the Applicant worked on a regular and systematic basis. From 7 September 2009 her employment was converted to part time engagement of 30 regular hours per week. The duties included more expansive sales and marketing work.6 The employment contract signed by both parties provided for the following additional incentive payments for work outside of her ordinary hours: “Christine will be paid $75 for a successful booking of a wedding and $25 if she hosts a meeting outside of contracted hours and $25 if she travels outside of contracted hours”.7 In addition to this the Applicant earned money from the Respondent as a contractor doing filming and editing work on wedding videos. The Applicant gave evidence that she had an ABN and invoiced the Respondent for this work at an agreed rate for each job. The Applicant did not do this work for any other employer. The Applicant received superannuation on these payments from the respondent.

[6] The Applicant and Mr Beck gave evidence that a further contract was drawn up in mid 2010. That contract is said to operate from “1 July 2010 until 30 June 2011.” 8 The terms of this contract are substantially the same as the earlier contract which commenced on 7 September 2009. The Applicant and Mr Beck say that the Applicant signed this contract and that the Applicant acted on the basis that this was an agreed position between the Respondent and the Applicant. However, Mr Whimpey did not sign the document as he wanted some changes made which were never specified. Mr Whimpey essentially confirms this evidence.

[7] I am satisfied by the evidence that the Applicant was working as a regular and systematic casual employee from 1 July 2009 until 30 September 2009. Then from 30 September 2009 onwards as a part time employee for 30 hours per week, plus additional hours paid on the basis of $75 for a successful booking of a wedding, $25 if she hosts a meeting outside of contracted hours and $25 if she travels outside of contracted hours. The evidence does not support a conclusion that the Applicant was engaged from 30 September 2009 for a fixed term or task. The employment contract was understood to be ongoing. Unless and until there was an agreed change to the contract of employment it remained on foot on the terms it was made on 30 September 2009.

[8] It is unclear as to whether or not the additional piecework done by the Applicant for which she invoiced the Respondent should be regarded as work done by her as an employee or as work done by her as an independent contractor. It is clear that the engagement has some of the characteristics one would expect in an employment relationship, for example; payment of superannuation, only one client, the employer determines the rate for the job, the employer determines the jobs to be performed, and the fact that there is an employee/employer relationship already in place between the parties. It is equally clear that the engagement has some of the characteristics that one would expect in an independent contractor relationship, for example; the use of an ABN and invoicing. There is no evidence before me as to the taxation arrangements which applied. It is not necessary for me to determine this matter at this stage.

[9] The work of the Applicant was highly regarded by Mr Whimpey. The Applicant contributed to a significant increase in sales as can be demonstrated by an examination of the accounts. 9 Not all of the improvement in sales was attributable to the efforts of the Applicant.

The evidence and findings concerning the cessation of the Applicant’s employment.

[10] It is the evidence of both parties that from early 2011 with the employment of the two new directors significant changes in the business affecting the employment of Mr Beck and the Applicant took place. The Applicant took on additional and changed duties and her job title was changed to team leader. The new duties included training or inducting staff, managing work flow and dealing with client feedback. The rate paid by the Respondent for piecework doing filming and editing of wedding videos was reduced. The Applicant was not prepared to continue doing this work at the reduced rate.

[11] On 21 March 2011 there were meetings with employees, including the Applicant, to discuss changed roles and the Applicant was provided with a draft new employment contract and job description. There were discussions about this document between the Applicant and Ms Glover and Mr Whimpey. They agreed to consider the concerns raised by the Applicant about the inadequacy of the remuneration and other matters.

[12] On 7 April 2011 there was a meeting between the Applicant and Mr Whimpey and Ms Glover. At that meeting the Respondent made it clear that they could not accommodate the concerns of the Applicant about the reduction in her income due to the reduced piecework rate. The Applicant says:

“I was told that they could not accommodate me with regard to my contract concerns and remuneration, and I could accept their offer, or they would be happy to have me work with them until I found suitable employment.” 10

There was nothing in the evidence of Mr Whimpey or Ms Glover which conflicts with this account except that at a later stage Ms Glover, in an email, advised the Applicant that there was no open ended commitment about ongoing employment. I do not regard this as relevant since I have found that the Applicant’s employment was permanent part time.

[13] On 7 April 2011, following the meeting, Ms Glover sent an email to the Applicant saying: “Hi Christine, Please find the updated contract attached. Please review, sign and return by Friday, With thanks Li Mei.” 11 Friday was the next day. The contract which was attached12 represented a significant change to the employment conditions of the Applicant. For example, Clause 3 provided:

“the employee’s employment will initially be subject to a probationary period of three (3) months. During the probationary period the employee’s employment may be terminated by either party providing to the other one week’s written notice or payment in lieu thereof.”

A number of clauses were more restrictive than the existing employment arrangements including clause 20 which bound the employee to future policies of the company in respect to a range of matters without limitation and clause 19 which provided for suspension without pay. Schedule 1 changed the Commission structure so that it was now a percentage of sales rather than a fixed amount per booking and meeting.

[14] I am satisfied after considering all the evidence that had the Applicant agreed to the new contract terms on 8 April 2011 her employment would have been ongoing.

[15] On 8 April 2011 Ms Dixon responded to the ultimatum of Ms Glover by writing an email to Mr Whimpey stating:

“Hi Ben, After our meeting yesterday, regarding the new contracts, and finding out the disappointment that Orsino Images can not accommodate my career anymore, and you would be happy to let me move onto other opportunities, I would like to take up your offer of a written “Glowing Reference” so that I am able to find a new career as soon as possible. It is saddening and stressful that management has come to this decision, and at this time and stage in my life...”

[16] I am satisfied that there is an implication in the Applicant’s responses that this would not be much beyond 30 June 2011. The Applicant submitted that there was no end date but her evidence on this point was equivocal. The implication is confirmed by correspondence sent to Mr Whimpey by the Applicant on 22 April 2011 where she says:

“Ben you can not push me out of Orsino before the end of June when my contract runs out, if I have employment before then I will leave sooner so that I am no longer a financial burden on you, otherwise, I will be here till the end of June and you can pay me out the annual leave I am owned.” 13

[17] Following the 8 April 2011 response there was then an exchange of correspondence about the contents of the “Glowing Reference”. I am satisfied that this exchange together with the absence of any evidence or any other communication to the contrary, confirmed that the Respondent accepted the Applicant’s response of 8 April 2011 and agreed to act consistent with it.

[18] There is no contest that the Applicant was entitled to be paid two weeks notice as it is not contested that she had more than a year of service but less than three years of service. In addition it is not contested that the Applicant was entitled to 68 hours of annual leave. The Applicant was paid until 31 May 2011 and this pay included both these entitlements.

[19] Mr Whimpey gave evidence that:

“Separate from Christine’s offer of contract, during early April 2011, I discussed with my business partners the need to address a fast declining cash flow situation by reconsidering the options and structure of the business. After numerous management discussions it was determined that overheads (largely made up of salaries) needed to be reduced. My business partners and myself felt it was our responsibility to inform Christine that there was a risk that Orsino was not going to be able to pay her salary on-going and we needed to finalise a reasonable end date of her employment so that she was given sufficient notice of her position ceasing.” 14

[20] I am satisfied that there was no suggestion by the Respondent to the Applicant that her job was at risk of being made redundant in the 7 April 2011 meeting or prior to that time. I am satisfied that the first time that “the need to address a fast declining cash flow situation by reconsidering the options and structure of the business” was raised with the Applicant was at or after the 21 April 2011 meeting.

[21] The evidence of the Applicant and Mr Whimpey and Ms Glover are in conflict over what was discussed at the 21 April 2011 meeting. All agree that the poor financial position of the company was discussed at that meeting. All agree that the Applicant was offered further piecework at the reduced rate and the Applicant declined this offer. Mr Whimpey says that the Applicant was also offered 15 hours per week casual sales and marketing work but the Applicant denies that this redeployment option was ever raised at the meeting. Mr Whimpey and Ms Glover say that changes to duties were discussed including that the Applicant would no longer have access to payments for meeting clients out of hours as provided in her contract of employment. The Applicant denies this was discussed.

[22] The Applicant says that nothing was said that would change the arrangement reached on 8 April 2011 that she would continue in employment until she found a new job.

[23] On 21 April, following the meeting, two emails were sent by Ms Glover to the Applicant. The first said that: “we would like to confirm that you and Orsino have agreed that you will be paid until 30 June 2011,” 15 and the second was the same as the first except that it said that: “we would like to confirm that you and Orsino have agreed that you will be paid until 31 May 2011.”16 One can readily understand how this might have been annoying to the Applicant. In all of the circumstances it is very hard to see how Ms Glover could assert that this was an agreement.

[24] The 21 April correspondence outlined the duties that the Respondent expected the Applicant to fulfil during the remainder of her employment, directed that work was to be completed during the 30 ordinary hours and that access to payments for meeting clients outside of normal hours would no longer be available. The Applicant says that both these requirements were contrary to her employment contract in that the duties were new and access to payments for meeting clients outside of ordinary hours was specified in her contract. I accept the veracity of the later point. The Applicant was required to finish work on 13 May 2011 and then use her annual leave for the balance of the time until 31 May 2011.

[25] The Applicant says that she received the emails on 22 April. However, the Applicant says that the notice of 22 April was not proper because it was sent by email and she did not in fact receive formal written notice until 3 May 2011. Mr Whimpey left a written notice on her desk on 28 April 2011 but she was not at work to receive that notice at the time. I am satisfied that the Applicant did receive the notice by email on 22 April 2011 and she confirmed receipt of the notice by message sent by email in response to Mr Whimpey on that day.

[26] On balance I prefer the Applicant’s version of what was discussed at the meeting on 21 April 2011. In my view the angry and hurt response of the Applicant to the material contained in the subsequent emails from the Respondent was genuine and supports her version of what was discussed at the 21 April 2011 meeting.

[27] There is no doubt that the financial difficulties of the company were discussed with the applicant on 21 April 2011. An examination of the correspondence from the Respondent to the Applicant of 21 April, 28 April and 3 May shows that the reasons for the termination are not set out in the correspondence of 21 April. In the letter of 28 April the reason for the “notice of cessation of employment” is set out as follows:

“As explained in our meeting the reasons for this decision has been due to the financial situation of the company. As responsible owners of the company we feel it fair to be transparent to our staff where there is a possibility that we may not be able to meet salary obligations. We have done this by communicating to you that we cannot commit to employing you beyond the above date.” 17

Was there a genuine redundancy?

[28] The Respondent advertised and filled positions following the termination of the Applicant. The Respondent gave evidence that in the main these are 15 hours per week casual positions for workers who take and or edit the wedding movies. There is no contest that the Applicant was offered this type of work at the reduced rate on 21 April 2011 and the Applicant declined this offer.

[29] I am satisfied that the evidence supports a conclusion that the duties performed by the Applicant in the period prior to the cessation of her employment are with minor exceptions still being performed by the Respondent. However, these duties have been distributed amongst other employees including the directors of the company. The fact that the duties continue to be performed does not in itself establish that the redundancy is not genuine.

[30] It is difficult to establish the number of employees of the company at the time of the employment ceasing and following the departure of the Applicant. Mr Beck gave evidence that there were 17 employees of the company on 21 April 2011. 18 The majority of the employees were described at that time as contractors. The Respondent concedes that most of these contractors are in fact employees based on the Australian Tax Office definitions. In response to this there are now 9 casual employees who would previously have been described as contractors.19

[31] The Respondent gave evidence that Corey Sleep, Molly Perrett and Marcus Wells should not be included as they were not engaged on 21 April 2011. The Respondent also gave evidence that there were other employees who should not be included and referred in particular to Gavin Fisher, Subhendra Sukumaran, Michelle Bourke, Nathan Field and Lachlan Wright. I am satisfied that Gavin Fisher, Subhendra Sukumaran, and Nathan Field should be included as they appear on the current list of casual employees. 20 Lachlan Wright should be included as the Respondent gave evidence that he was working for the company at the relevant time. The Respondent gave evidence that Michelle Bourke should be regarded as a contractor because she worked for another company and only did contract work for the Respondent. Although there is some doubt, on balance, I am satisfied that Michelle Bourke was an employee of the Respondent given that the other contractors have subsequently been found to be employees.

[32] The evidence was that Corey Sleep, Molly Perrett and Marcus Wells have not been paid and have not requested payment for any work after the 18th, 7th, and 12th of April respectively. The Applicant suggested that further invoices might be forthcoming, however, there is no basis upon which I can find that Corey Sleep, Molly Perrett and Marcus Wells were employees of the Respondent at 21 April 2011. Having considered all the evidence I am satisfied that the other employees on the list provided by Mr Beck were employees of the Respondent at the relevant time. Therefore I am satisfied that the Respondent had 14 employees as at 21 April 2011. The Respondent has 13 employees as at 19 September 2011. 21 As the Respondent is a small business I am satisfied that if the Applicant was given notice that she was to be made redundant on 21 or 22 April 2011 then she is not entitled to redundancy pay.

[33] I am satisfied that the Applicant’s employment with the Respondent is covered by the General Retail Industry Award 2010. I put to the parties in the proceedings my view that this was likely to be the case and the reasons for that preliminary view. The parties agreed with my assessment. The primary function of the business is the sale of products and services directly to consumers. That product and service is the organisation, production and delivery of wedding videos. The Applicant was engaged in marketing, sales, administration and production functions associated with this primary function. The Applicant did engage in some incidental functions which were not providing goods or services directly to customers, namely the marketing of the business at wedding expos, however, this does not change the principal purpose of the business or of the Applicant’s employment. The Award defines the general retail industry to mean “the sale or hire of goods or services to final consumers for personal or household consumption”. The definition in the Award gives examples of what is included in that definition and also specifies what is not included in that definition. The business of the Respondent clearly does not fall within those exceptions. The classification definitions in the Award clearly cover the type of work performed by the Applicant.

[34] The General Retail Industry Award 2010 at Clause 8 provides as follows:

“Consultation regarding major workplace change

Employer to notify

Where an employer has made a definite decision to introduce major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must notify the employees who may be affected by the proposed changes and their representatives, if any.

Significant effects include termination of employment; major changes in composition, operation or size of the employer’s workforce or in the skills required; the elimination or diminution of job opportunities, promotion opportunities or job tenure; the alteration of hours of work; the need for retraining or transfer of employees to other work or locations; and the restructuring of jobs. Provided that where this award makes provision for alteration of any of these matters an alteration is deemed not to have significant effect.

Employer to discuss change

The employer must discuss with the employees affected and their representatives, if any, the introduction of the changes referred to in clause 0, the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of such changes on employees and must give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.

The discussions must commence as early as practicable after a definite decision has been made by the employer to make the changes referred to in clause 0.

For the purposes of such discussion, the employer must provide in writing to the employees concerned and their representatives, if any, all relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on employees and any other matters likely to affect employees provided that no employer is required to disclose confidential information the disclosure of which would be contrary to the employer’s interests.”

[35] I am satisfied that the Respondent in this case made a definite decision to introduce major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees. Those changes had two phases. The first was the changes introduced in the first quarter of 2011 with the engagement of two new directors and the associated reorganisation. The second was between 8 April 2011 and 21 April 2011 when due to financial difficulties the Respondent determined to reduce labour costs, including by dismissing the Applicant or alternatively by bringing forward her departure date.

[36] I am satisfied that in respect to the second decision the Respondent did not provide in writing the relevant information about the changes proposed and did not give adequate opportunity for discussion about alternatives and mitigation.

[37] The Act provides the following in respect to the question of genuine redundancy.

“389 Meaning of genuine redundancy

(1) A person’s dismissal was a case of genuine redundancy if:

(a) the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and

(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

(2) A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:

(a) the employer’s enterprise; or

(b) the enterprise of an associated entity of the employer.”

[38] I am therefore not satisfied that the provision of Section 389(1)(b) is satisfied. If the Applicant was made redundant on 21 or 22 April 2011 then it could not have been a genuine redundancy.

[39] In the circumstances it is not necessary for me to determine whether or not it would have been reasonable in the all the circumstances for the Applicant to have been redeployed.

Conclusions

[40] Given that the Respondent is a small business I am first required to consider if the Small Business Code is applicable. The parties agreed that it was not relevant in the circumstances of this case and the Respondent does not seek to rely on it. I am satisfied that the dismissal was not in accordance with the Small Business Code. The Act requires that I now consider the following:

“387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWA must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that FWA considers relevant.”

[41] There are three different ways in which the cessation of the Applicant’s employment could be considered.

• Firstly, it might be said that the Applicant gave notice of her resignation on 8 April 2011 and the period of notice was up to 30 June 2011 or earlier by agreement.



• Secondly, it might be said that the Applicant was dismissed at the initiative of the employer on 8 April 2011 because the Respondent issued an ultimatum to the Applicant on 7 April 2011 that she accept a new contract of employment by 8 April 2011. The clear implication of the ultimatum was that the Applicant would no longer be employed in the event that she did not comply.



• Thirdly, it might be said that the Applicant was made redundant on 21 or 22 April 2011.

[42] The first approach to the cessation of the Applicant’s employment is not relevant because it is overtaken by the second or the third approach. If the second approach is not correct then the third approach is. I put the second and third approach to the parties at the conclusion of the proceedings and outlined the basis for those approaches and I gave the parties the opportunity to make submissions about them.

[43] The Act provides:

“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.”

[44] Having considered all of the evidence in this matter I am satisfied that the Applicant was dismissed by the Respondent on 8 April 2011. On 7 April 2011 the Respondent issued an ultimatum to the Applicant to sign a new contract of employment by the next day. On 8 April the Applicant refused to sign the contract and acknowledged that her employment with the Respondent would therefore come to an end and advised that she would continue to work until 30 June 2011 unless she found alternative employment in the meantime. The Respondent by its actions in responding to the Applicant’s email of 8 April 2011 with the provision of a “glowing reference” clearly accepted what the Applicant had said in her email of 8 April 2011. I am satisfied that this was a constructive dismissal at the initiative of the employer and that the Applicant was given notice until 30 June 2011 and that her entitlements to annual leave were not a part of the period of notice.

[45] I am satisfied that there was no valid reason for the termination. The ultimatum was unreasonable and unfair. There was nothing in the conduct or performance of the Applicant which justified the termination of her employment. If the Applicant had signed the new contract it is arguable that it would still have been a termination since the contract purported to establish a totally new contract of employment. 22 Clause 3 provided:

“the employee’s employment will initially be subject to a probationary period of three (3) months. During the probationary period the employee’s employment may be terminated by either party providing to the other one week’s written notice or payment in lieu thereof.”

[46] In any case, for the reasons I set out earlier in this decision the demand to sign a new contract of employment was unfair and unreasonable and represented a significant detrimental change to the employment conditions of the Applicant and an effective repudiation by the employer of the existing employment contract.

[47] The Applicant was advised of the reason for the termination but it was not a valid reason. The criteria in Section 387(c) and (e) are not relevant because the dismissal did not relate to the conduct or performance of the Applicant. The Applicant was not refused a support person. The small size of the business did impact on the procedures used by the Respondent but cannot excuse a dismissal without a valid reason. One of the directors of the Respondent, Ms Glover, has human resources expertise 23 so the absence of human resources expertise did not impact on the procedures used. I have referred to any other relevant matters earlier in this decision.

[48] I am satisfied that the dismissal of the Applicant on 8 April 2011 was harsh, unjust and unreasonable.

[49] In the event that I am wrong about the finding that the Applicant was dismissed on 8 April 2011 then the Applicant was dismissed by email on 22 April 2011. The reason for that dismissal outlined in the correspondence dated 28 April 2011, but not received by the Applicant until 3 May 2011, was for reasons of financial difficulty. In my judgment this was effectively a redundancy. However, for the reasons outlined earlier it was not a genuine redundancy. I am satisfied having considered all of the circumstances that there may have been a valid reason for the termination at this time, namely the financial difficulties of the company, but the termination was nonetheless unfair, unjust and unreasonable as a proper process of consultation may well have resulted in a reasonable alternative to termination of the Applicant’s employment at that time. In the case of the dismissal on 22 April 2011 the Applicant was not advised of the reasons until after the termination. The criteria in Section 387(c) and (e) are not relevant because the dismissal did not relate to the conduct or performance of the Applicant. The Applicant was not refused a support person. The small size of the business did impact on the procedures used by the Respondent but cannot excuse a dismissal without a valid reason. One of the directors of the Respondent, Ms Glover, has human resources expertise 24 so the absence of human resources expertise did not impact on the procedures used. I have referred to any other relevant matters earlier in this decision.

[50] In the event that I am wrong in finding that the Applicant was dismissed on 8 April 2011 then the Applicant was dismissed by email sent on 21 April 2011 but received by the Applicant on 22 April 2011 by reason of redundancy. The redundancy was not a genuine redundancy. For the reasons discussed earlier the dismissal was harsh, unjust and unreasonable.

Remedy.

[51] The Act provides that I must order reinstatement unless I am satisfied that reinstatement is inappropriate. In the circumstances of this case both parties submit that reinstatement is inappropriate. I concur. The relationship between the Applicant and the new directors of the company is very bitter. I judge that in the circumstances of this particular small business the relationship is not likely to be able to be repaired.

[52] I consider that an award of compensation is appropriate. The Act provides that in determining compensation I should have regard to the following.

“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 $59,050 from 1 July 2011

(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.”

[53] Although I accept that the Respondent has had some financial difficulties the evidence does not support a conclusion that the recent losses incurred by the company are large or that any order I might make in these proceedings would affect the viability of the enterprise.

[54] I am satisfied that there was no misconduct by the Applicant which would affect the amount of compensation.

[55] The length of service is not so long nor is it so short as to affect the appropriate award of compensation.

[56] I am satisfied by the unchallenged submission of the Applicant that she has been actively looking for employment since the termination and has engaged a person to assist her in that process. I am also satisfied that the Applicant has not yet found alternative employment and has not earned any income from employment since the termination. I am satisfied that the Applicant has made adequate efforts to mitigate her losses. Given that this decision follows closely on the hearing of the matter s 392(f) is not relevant. There are no other matters I consider relevant.

[57] The critical factor in this case is the remuneration that the Applicant would have received, or would have been likely to receive, if she had not been dismissed. The evidence of a poor relationship between the Applicant and the two new directors of the company was strong. The Applicant was not generally supportive of the way in which the Respondent was determined to restructure the business. Although it is possible that a suitable alternative role for the Applicant may have been found in the restructured business I consider this unlikely to have been an outcome which would survive for very long. I consider that the Applicant would have remained in employment if it was not for the dismissal until the end of July 2011. The Applicant was in paid employment until 13 May 2011. In addition to this the Applicant was paid her annual leave entitlements. I therefore consider that the Applicant would have been paid for a further 11 weeks.

[58] The Applicant gave uncontested evidence that her gross income excluding superannuation from the Respondent (excluding any amounts invoiced for production and editing of wedding videos outside of ordinary hours) was $18,801.26 over the past 41 weeks. The weekly income is therefore $458.56 gross plus $41.27 superannuation. The Applicant should therefore be paid compensation of $5,498.13 less taxation as required by law. The amount should be paid within fourteen days of this decision. An order to this effect will be published separately.

COMMISSIONER

Appearances:

Ms Christine Dixon appeared on behalf of herself and was assisted by her father Dr Raymond Dixon.

Mr Ben Whimpey and Ms Li Mei Glover, Directors of the company, appeared on behalf of the Respondent.

Hearing details:

2011

Melbourne

October 6

 1   Exhibit D1.

 2   Exhibit D2.

 3   Exhibit O1.

 4   Exhibit O2.

 5   Exhibit D1, Attachment A.

 6   Exhibit D1, Attachment B.

 7   Ibid.

 8   Exhibit D1, Attachment C.

 9   Exhibit D2 and Exhibit O1, Attachment C.

 10   Exhibit D1, para 14.

 11   Exhibit D1, Attachment E1.

 12   Exhibit D1, Attachment E.

 13   Exhibit D1, para 20.

 14   Exhibit O1, paras 18 and 19.

 15   Exhibit D1, Attachment G.

 16   Exhibit D1, Attachment G1.

 17   Exhibit O1, Attachment F.

 18   Exhibit D3, para19 and evidence in proceedings.

 19   Exhibit O1, Attachment A and B.

 20   Exhibit O1, Attachment B.

 21   Ibid.

 22   Exhibit D1, Attachment E.

 23   Exhibit O2, para 2.

 24   Ibid.

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