Ms Larna Morgan v Mr Ivan Spehar t/as Ivan's Butchery

[2011] FWA 6035

[2011] FWA 6035

FAIR WORK AUSTRALIA

DECISION

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

Ms Larna Morgan
v
Mr Ivan Spehar t/as Ivan's Butchery
(U2011/6585)

SENIOR DEPUTY PRESIDENT DRAKE SYDNEY, 8 SEPTEMBER 2011

Termination of employment.

[1] I heard this application in Sydney on 12 August 2011.

[2] The applicant, Ms Morgan, appeared on her own behalf. Mr Ivan Spehar, the proprietor of Ivan’s Butchery, did not appear. Mr Spehar had, on 14 July 2011, provided by email a short statement headed “To whom it may concern”. The substance of that email is set out below:

“I, Ivan Spehar, on behalf of Ivan’s Butchery have no witness statements or documentary material related to Larna Morgan. I based it on the situation that she did go on her break and upon coming back she did smell of alcohol. It was also reported to me by my store manager on a few occasions. I also lent her $2000 before this incident. She did pay it back in instalments and thank you for that. Now with this situation, my only decision was to give her her dismissal on the spot with two weeks pay. I called the Meat Federation to confirm my actions and was told that I was doing it all according to the law and regulations. She accepted the money and signed a slip that confirmed the payment.”

[3] On the morning of 12 August 2011 my associate, at my request, telephoned Mr Spehar at one of his butcheries. He was informed by Mr Spehar that he was too busy to attend the hearing. As a result of Mr Spehar’s non attendance Ms Morgan was not cross-examined regarding her version of the circumstances surrounding her dismissal.

[4] Ms Morgan presented at the hearing and gave her evidence. She was very distressed during the course of her evidence. She outlined the circumstances of her dismissal, both in the letter which was her submission, 1 with which she provided attached character references, and in her oral evidence.

“I Larna Morgan of 130 Neville St Smithfield matter number U2011/6585.
I was born on the 19th August 1979.
I was working at Ivans butchery for 3 years until March 21 2011.

I went to Ivan at Chester Hill to pick up my holiday pay which was 2 weeks pay because I did get 2 weeks holiday pay prior to that.
When Ivan handed me a letter and then started to read Ivan then told me he has to let me go.....
I did state to Ivan that letter was untrue.
I did tell Ivan that letter does describe another girl that I worked with.

I then signed my pay slip and went to the ANZ bank to cash the cheque because I was in the middle of moving house.
When I got a phone call from Ivan saying that he had another 2 weeks pay he had to give me.
After I signed it Ivan then said to me think of it as 2 weeks pay and not even working.

I was working 52 hours a week it is amazing how somebodys pay drops after 38 hours and Ivan chose when it was a public holiday or not.
I will give you a copy of the letter that was printed out for Ivan of why I lost my job.” 2

[5] The correspondence from the anonymous person who complained about Ms Morgan was attached to Ms Morgan’s submissions. I have not set out the contents. True to form regarding most such anonymous correspondence the allegations are wide ranging, scurrilous and self righteous. It contained numerous allegations of an offensive nature concerning Ms Morgan’s conduct and character.

[6] Ms Morgan has been unemployed except for a short period since the termination of her employment. She has worked for two weeks work in a bread factory. She has otherwise been unemployed. She has felt unable to continue with employment whilst the upsetting nature of her termination of employment and the allegations against her were unresolved. Her appearance before me was consistent with her alleged level of upset.

[7] I am required to consider the following provision of the Act when considering the application before me.

“Section 387

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.”

[8] For the purposes of remedy, if appropriate, the following provisions apply:

“Section 390

(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.

Section 391

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.

Section 392

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.”

[9] I have considered s387(a). I have accepted Ms Morgan’s evidence. The only contrary material before me is the anonymous correspondence. Mr Spehar failed to give any evidence regarding these matters. I have determined that there was no valid reason for the dismissal of Ms Morgan related to her conduct or performance.

[10] I have had regard to s387(b) and (c). Ms Morgan was not provided with any notification of the reason for her termination of employment prior to her attending to collect her wages. She was given no opportunity to respond. I accept that any explanation she sought to provide was dismissed by Mr Spehar without investigation.

[11] Section 387(d) is not relevant in the circumstances of this application.

[12] In relation to s387(e) I have already found that the termination of Ms Morgan’s employment did not arise from any inadequate performance by Ms Morgan.

[13] In relation to s387(f) and (g) I am unable to determine whether or not Mr Spehar would have in place procedures to follow in a dismissal or any dedicated human resource management specialist.

[14] In relation to s387(h) I have had regard to Mr Spehar’s failure to provide a proper process to Ms Morgan. I have had regard to the social and financial consequences for Ms Morgan following the termination of her employment, the possible effects of termination of employment for misconduct on her prospects of finding new employment and the general absence of fairness exercised by Mr Spehar regarding the allegations against Ms Morgan.

[15] I have determined that the dismissal of Ms Morgan was harsh, unjust or unreasonable.

“[3] In determining whether a particular termination is harsh, unjust or unreasonable consideration can be given as to whether the penalty of termination is excessive or inappropriate. See Byrne v. Australian Airlines Ltd (1995) 185 CLR 410 at 465 per McHugh and Gummow JJ.

“It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.”

And

“Procedures adopted in carrying out the termination might properly be taken into account in determining whether the termination thus produced was harsh, unjust or unreasonable”. 3

[16] The dismissal of Ms Morgan was harsh, unjust or unreasonable because there was no valid reason for it. It was also harsh because she was given no notice of any allegation against her or any opportunity to respond to it. It was unreasonable and unjust for the same reason that it was harsh. It was also harsh for the social and economic consequences to Ms Morgan.

[17] Having determined that the termination of Ms Morgan’s employment was harsh, unjust or unreasonable I have to consider what remedy to apply to Ms Morgan.

[18] I have given consideration as to whether reinstatement would be appropriate in this case. In all the circumstances, having taken into account Ms Morgan’s upset and the personal affront she has suffered I have decided that reinstatement would be inappropriate.

[19] I have given consideration as to whether compensation would be an appropriate remedy in all the circumstances of this case. I have decided that compensation would be appropriate. In deciding what compensation would be appropriate I have given consideration to the matters referred to in s392(2).

[20] There is no information before me regarding whether or not any order I might make would have an effect on the viability of Mr Spehar’s enterprise.

[21] The length of Ms Morgan’s service is a neutral consideration.

[22] I have had regard to the remuneration that Ms Morgan would have received or have been likely to receive if she had not been dismissed.

[23] I have had regard to the efforts of Ms Morgan to mitigate her loss taking into account the effect that the dismissal has had on her ability to work. I do not believe that Ms Morgan has made a 100% effort to find new employment but when considering this issue I have also had regard to the fact that she sought work in a bread factory immediately after her employment was terminated but felt unable to continue.

[24] I have had regard to the amount of remuneration earned by Ms Morgan during the period of her employment in other work.

[25] I have had regard to any income Ms Morgan is reasonably likely to earn during the period between the making of this order and actual compensation.

[26] I am satisfied that there was no misconduct which could properly contribute to Mr Spehar’s decision to dismiss Ms Morgan. I have therefore not reduced the amount of compensation which I would otherwise order.

[27] The amount that I order for compensation does not include any component by way of compensation for the shock, distress or humiliation or any other analogous hurt caused to Ms Morgan by the manner of her dismissal.

[28] I have concluded that Ms Morgan’s gross weekly wage was $540.00.

[29] I have decided sixteen weeks compensation would be the appropriate remedy in all the circumstances of this application.

SENIOR DEPUTY PRESIDENT

 1   Exhibit Morgan 1

 2   Ibid.

 3 (1995) 185 CLR 410 at 465 per McHugh and Gummow JJ

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