Ms Rosemary White v Sydney College of English Pty Ltd
[2010] FWA 9492
•17 DECEMBER 2010
[2010] FWA 9492 |
|
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Ms Rosemary White
v
Sydney College of English Pty Ltd
(U2010/10875)
SENIOR DEPUTY PRESIDENT DRAKE | SYDNEY, 17 DECEMBER 2010 |
Termination of employment.
[1] I heard this application on 6 December 2010. Ms White and Mr Takayasu, the proprietor of Sydney College of English Pty Ltd (SCE), represented themselves.
[2] There has already been one decision issued in relation to this application. On 30 September 2010 Commissioner Thatcher found that Ms White was not employed under a contract for a specified period of time. 1 The application was then allocated to me for arbitration. The initial issue for determination was the nature of the employment arrangement between Ms White and SCE.
[3] Mr Takayasu submitted that he had terminated Ms White’s employment at the end of a fixed term contract. His submission was that the contract came to an end with the effluxion of time. He submitted that he did not continue her employment because of financial pressures within his enterprise. He could not afford to continue to employ Ms White without having to terminate the services of other employees by way of a merger of his colleges.
[4] Subsequent to the cessation of Ms White’s employment Mr Takayasu submitted that he had become aware of a number of alleged acts of misconduct and failures of performance by Ms White which he relied on as valid reasons for the termination of her employment
[5] The preliminary issue for determination in this application is whether Ms White’s employment was terminated at the initiative of Mr Takayasu, the principal of SCE, or whether the contract of employment ceased at the conclusion of a fixed term contract. For the purpose of considering this issue, I am required by the Fair Work Act 2009 (the Act) to consider the following provisions:
“Section 385
What is an unfair dismissal
A person has been unfairly dismissed if FWA is satisfied that:
(a) the person has been dismissed...”
and,
“Section 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...
......
(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 ......”
[6] Ms White’s evidence and submission was substantially contained in an extensive document 2 and her speaking notes,3 which she read aloud at the hearing. She supported these documents by a number of other exhibits, predominantly emails. Mr Takayasu’s evidence was an extensive written submission with supporting documentation4 as well as oral evidence and submissions. I do not intend to repeat the submissions of the parties.
[7] I am not persuaded by the evidence and submission of Mr Takayasu that Ms White was employed other than as a full-time permanent employee.
[8] The two contracts of employment Mr Takayasu had Ms White sign bear no relation to the reality of the employment relationship between them. They appear to have come into existence in a random fashion. I have concluded that they are documents specifically prepared for the purpose of circumscribing Ms White’s actual employment for the purpose of excluding her from the jurisdiction of Fair Work Australia. I reject Mr Takayasu’s characterisation of Ms White’s employment and therefore his jurisdictional objection.
[9] I have determined that Ms White was employed from commencement of employment to termination of her employment as a full-time permanent employee and that Ms White’s employment was terminated on the initiative of SCE. I am therefore required to apply 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.”
[10] For the purpose of considering 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.”
[11] I have considered s387(a). I have determined that there was no valid reason for the dismissal of Ms White related to her conduct or performance.
[12] Mr Takayasu decided that he no longer required the work Ms White performed as a Director of Studies to be performed by any person in that particular College. Her position was therefore redundant. That was the reason for the termination of her employment. Her employment did not cease because of the effluxion of time. It ceased because Mr Takayasu made a decision not to continue her position.
[13] I have also determined that there was not a valid reason for the termination of Ms White’s employment arising from any of the particular misconduct or failures of performance subsequently identified by Mr Takayasu. The documentary material that Mr Takayasu provided was inadequate to establish any of those grounds and I was not persuaded by his direct evidence on these matters wherever he had first hand knowledge of the events, which was in very limited circumstances.
[14] I have had regard to s387(b) and (c). I find that Ms White was not provided with any notification of any reason for the termination of her employment nor given any opportunity to respond to those reasons. If Ms White had been aware of the financial basis of Mr Takayasu’s decision she may have had an alternative employment proposition which could have led to the continuation of her employment. It is now not possible to make any finding about that issue.
[15] Section 387(d) is not relevant.
[16] In relation to s387(e) I have already made a finding that the termination of Ms White’s employment did not arise from any inadequate performance by Ms White.
[17] In relation to s387(f) and (g), given the size of Mr Takayasu’s enterprise, it would not be likely that he would have in place procedures to follow in effecting a dismissal or any dedicated human resource management specialists. I have had regard to those matters.
[18] In relation to s387(h) I have had regard to Mr Takayasu’s failure to consult Ms White regarding the financial pressures in his enterprise, any possibilities for redeployment or any other matter concerning the termination of her employment.
[19] I have had regard to my finding that Mr Takayasu introduced the two contracts of employment to inaccurately characterise and limit Ms White’s employment.
[20] I have had regard to the fact that no notice was paid to Ms White on termination of employment.
[21] I have determined that the dismissal of Ms White 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”. 5
[22] The dismissal of Ms White was harsh because she was given no notice of any imminent cessation of employment and because an inaccurate reason was relied upon. It was unreasonable and unjust for the same reasons that it was harsh. It was also harsh for the social, economic and professional consequences to Ms White.
[23] Having determined that the termination of Ms White’s employment was harsh, unjust or unreasonable I have to consider what remedy to apply to Ms White.
[24] I have given consideration as to whether reinstatement would be appropriate in this case. In all the circumstances, having taken into account the financial pressures about which Mr Takayasu has given evidence, I have decided that reinstatement would be inappropriate.
[25] 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 those matters referred to in s392(2).
[26] An order for compensation will, accepting Mr Takayasu’s evidence about the viability of the College, have an effect on the viability of his enterprise. I have had regard to that matter.
[27] I have had regard to Ms White’s length of service which I consider to be a positive factor.
[28] I have had regard to the remuneration that Ms White would have received had she not been dismissed.
[29] I have had regard to the efforts of Ms White to mitigate her losses. I consider them to have been satisfactory.
[30] I have had regard to the remuneration earned by Ms White since termination of employment and the amount of any income likely to be so earned between the making of this order for compensation and the actual compensation. Ms White has earned some income in an on-line business and food stall since termination of employment.
[31] I have given consideration to the circumstances surrounding the dismissal of Ms White and the financial detriment she is likely to suffer. In particular I have had regard to the fact that, because Ms White has had her employment terminated, she is likely to be handicapped in her ability to find another senior position. This difficulty is exacerbated by the timing of the termination of her employment. This application came on for hearing at the end of the year. Most senior positions as Director of Studies, and other related positions, will have been filled by now. This is an additional concern for Ms White.
[32] After consideration of all the circumstances of this case I have decided to award Ms White five months compensation.
[33] Because of the difficulties being experienced by Mr Takayasu in the management of his enterprises and the likely effect of this order on the viability of those enterprises I have decided to make an order for payment by instalments. This order will issue concurrent with this decision.
SENIOR DEPUTY PRESIDENT
1 PR502318
2 Exhibit White 1
3 Exhibit White 2
4 Exhibit Takayasu 1
5 (1995) 185 CLR 410 at 465 per McHugh and Gummow JJ
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