Ms Tara Singh v West Coast Industrial Supplies Pty Ltd T/A WCIS

[2013] FWC 9171

[2013] FWC 9171

FAIR WORK COMMISSION

DECISION

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

Ms Tara Singh
v
West Coast Industrial Supplies Pty Ltd T/A WCIS
(U2013/2032)

SENIOR DEPUTY PRESIDENT RICHARDS BRISBANE, 22 NOVEMBER 2013

Summary: whether dismissal at initiative of the employer - whether Applicant forced to resign her position - discomfort in employment relationship not ground for constructive dismissal - misrepresentation of accounting qualifications/professional memberships - accounting and taxation practices - findings of credit.

[1] On 21 June 2013 Ms Tara Singh (“the Applicant”) filed an application for an unfair dismissal remedy under s.394 of the Fair Work Act 2009 (“the Act”) in relation to her dismissal as Group Financial Controller from West Coast Industrial Supplies Proprietary Limited T/A WCIS (“the Company”).

[2] The hearing of this matter was long-delayed as the Applicant was in a culturally important mourning phase, which was not challenged by the Company. The hearing was not brought on until the Applicant was comfortable with proceeding in the context of that cultural obligation.

Jurisdictional objections

[3] The Company objected to the Commission further dealing with the application until such time as it had resolved three jurisdictional objections. One of these jurisdictional objections, which is the subject of this decision, concerned whether or not there had been a dismissal for the purposes of s.385(a) of the Act. It is to this objection that I will turn firstly.

[4] Section 385 of the Act provides as follows:

385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC 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.

[5] The meaning of dismissed is set out at s.386 of the Act, which provides relevantly as follows:

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.

[6] The Applicant’s employment was said to have come to an end for reason of the Applicant having tendered her resignation on 1 May 2013.

[7] The Applicant’s written letter of resignation had been addressed to the Respondent’s State Manager, Ms Rosemary Wishlow, and stated (relevantly) as follows:

Further to the events of 19 April and again this morning, I find it unreasonable for me to carry on working for West Coast Industrial Supplies Pty Ltd.

I therefore would like to tender my resignation notice for 1 month as stipulated in my employment contract dated 28th July 2011. This notice commences to date 1st May 2013 and finishes 31st May 2013.

I have outstanding annual leave as per attached schedule of 161.49 hours. I would like this to be paid into my normal bank account.

Should you wish to give to let me go immediately then I would request that WCIS pay me a month's wages as stipulated in the contract.

I will return all company properties that I have in good order and condition on the expiry of this notice period.

I have the following in my possession that belongs to the Company:

1. Mobile phone

2. Toyota Hilux vehicle

3. CBA and BankWest token.

As discussed, I will continue providing my services remotely in regards to past tax returns and future queries relating to statutory returns should the need arise. This service will be provided on a negotiated hourly rate.

Further, I will be giving your name as referee for future job opportunities.

Yours faithfully

Etc

[8] The above resignation was provided after such time as the Company had questioned the Applicant about the accuracy of her accounting and taxation practices, and ultimately expressed some queries about her professional qualifications.

[9] The Applicant had performed the role for the Respondent as the Group Financial Controller since July 2011.

[10] By early 2012 the Company had begun to question the accuracy of the Applicant’s accounting practices and her professional skills. Suspicion arose, it appears, from the discovery of various inaccuracies in the accounts, and the discovery that the Applicant could not process some particular accounting operations (which are discussed further below). The Respondent subsequently engaged a management accountant.

[11] The management accountant seemingly reported that there were “a large number of strange entries” involving some significant sums of money. The management accountant also reported, it would appear, that his further “examination revealed a huge number of errors that were made in the ledger and the tax return”. He went on to say - in the materials before me - that in his:

“opinion none [of] the entries since [the Applicant] joined the Company can be relied on. To correct the entries I believe that they all need to be checked from the date [the Applicant] joined.”

[12] The management accountant also reported, in the materials on file, that having interviewed the Applicant he did not believe that she could be a member of the Institute of Chartered Accountants in Australia (ICAA) as the quality of her work was well below that he would accept from an undergraduate accounting student. The management accountant was advised by the ICAA, upon his enquiries, that the Applicant was not a member of the Institute, despite her claims to him to be so.

[13] The Applicant had given various responses to such queries, including in the course of her evidence in this matter. She variously claimed that she never held herself out to be a chartered accountant, had never said she was a member of the ICAA, may have had some other level of association other than membership; may or may not have authored a resume as held by the Company (which formed an exhibit in these proceedings) that claimed membership of ICAA; and if she had so authored such a resume, it was a typographical error.

[14] Mr Wishlow admitted to having had concerns with the Applicant because the Applicant had been reluctant to offer supporting documentation regarding her qualifications. The documentation that Ms Wishlow did receive from the Applicant was said by Ms Wishlow to be either illegible or altered in some way. The Applicant’s date of birth also varied between various documents, some of which were demonstrably altered. The Applicant claimed that it was her cultural predisposition to conceal her date of birth.

[15] It was discovered that there had been a failure to lodge applications for the registration of R&D activities for which tax concessions had been sought in previous years, amongst other defects in procedure.

[16] Further investigations were carried out into the state of the Company’s books. These investigations revealed further accounting deficiencies.

[17] The Applicant was said to have tendered her resignation shortly thereafter, on the basis of one month’s notice. This was on 1 May 2013, which was the date of a meeting at which several of the above issues were discussed.

[18] In the course of the notice period the Company required a handover procedure to be put in place. To this end the Applicant was required to hand over her work to a certified practising accountant. The accountant seemingly indicated (at least through the materials on file) that “the errors were numerous and very basic, and [that he] was very shocked by the lack of quality given that [the Applicant] had purported to be a chartered accountant and was seeking her tax agent registration.” He went on to state, it appears, that:

“for the 2010, 2011 and 2012 financial years, we estimate that prior to any R&D tax concession, the effect of the errors in the original income tax returns will result in additional tax of approximately $460,000. This is our preliminary estimate and we are still reconciling some accounts before a final amount can be calculated.”

[19] The position therefore, was that the Applicant resigned her employment at her own initiative, albeit in a context where she was under some scrutiny as to the accuracy with which she had performed duties and her professional credibility.

[20] The Applicant, for her purposes, considers that her resignation was a case of constructive dismissal. That is, the Applicant claimed that “she was pressured to resign”, or in fact told to resign, was harassed, and it was unreasonable for her to continue working for the Company in the circumstances. Those circumstances included as follows:

• The Company pushed her to extremes;



• Their expectations of her were too high;



• She was “threatened legally”;



• Held accountable for issues (such as the R&D taxation claims) for which she was not accountable (as Group Financial Officer);



• She was required to complete a timesheet on a daily basis (indicating the time of her arrival and the time of her departure from the workplace);



• She had poor office and working conditions;



• Ms Wishlow’s secretary (Ms Alex Peters) took a dislike to her and she was “picked on” by Ms Peters, who was “vindictive and malicious.”

Discussion of the evidence

[21] The Applicant gave as an example of the “blame and pressure” placed on her various correspondence that she received in the course of her employment.

[22] This correspondence cannot be replicated readily but some extracts will be sufficient to give an indication of its tone and substance.

[23] One e-mail dated 18 April 2013 expressed concern on Ms Wishlow’s part as to the prioritisation of various accounting matters and the time taken to carry them out. This e-mail comprised a number of discrete questions with some implicit criticism of the Applicant.

[24] Ms Wishlow complained, in effect, that the “procedures for the QMS should be well and truly done, there have been a number of weeks to have this completed.”

[25] She further observed that that an important matter such as the “R&D letter was supposed to have been done and also some time ago.” [....]Upon finding out that it was to be done that day she asked rhetorically, it would seem, “This was a number one priority, who decided it could be put back?”

[26] Ms Wishlow stated that “super is a minor job and not a priority.” [...]

[27] Ms Wishlow asked, “How long for the taxes to be sorted this has been on the agenda for weeks [?]” When she was advised by the Applicant that there were complications with the R&D expenses involving the ATO and that a timeframe could not be provided, Ms Wishlow stated “How have I not heard about this. I need to know what the bottom line is here. You really need to keep me informed.”

[28] Ms Wishlow went on to say that the Managing Director, Mr Stephen Brooks, would be concerned with the state of affairs of the accounts.

[29] Later that day, Ms Wishlow made further comment about the situation facing the Company. Here she expressed concern that the R&D tax concession had not been completed:

The R&D is an opportunity for us to get our money back from the ATO, how can this not be a priority? I asked you to address this when we received the letter outlining the guidelines.

The amended tax return means we will be hit with another tax bill doesn't it? Excuse me if I am wrong, but surely this should take precedence over everything else.

To date the errors have cost us $184,000 and now we are going to be hit with more, how can any of the above not be a priority.

You say you are going to fix the problems and give it your full attention but clearly your focus is not where it should be, it is your responsibility to prioritise your workload you as a CA, would have been aware that any implications regarding R&D or tax would take priority over management reporting.,

This has impacted so severely on our cash flow that it is causing headaches with all statutory payments.

This has gone on far too long, and just the fact you do not apprise us of any developments from the ATO unless we ask is untenable.

I have discussed this with you ad nauseam, Steve has emphasised the urgency to get this right and the damage it is doing to the business, which concerns are proving to be well founded. (sic)

[30] Ms Wishlow’s email to the Applicant attests to tension in the employment relationship: Ms Wishlow is in a state of agitation and frustration. But nothing Ms Wishlow has communicated to the Applicant gave the Applicant reason to consider that she had no choice but to resign her employment. Ms Wishlow was expressing concerns that an employer reasonably might be concerned about in the circumstances.

[31] Early in the evening of 18 April 2013, Mr Brooks e-mailed the Applicant enquiring about the company’s SGC contributions, following what appeared to be complaints from various employees that their superannuation had not been paid.

[32] The Applicant replied to Mr Brooks directly and explained the cash flow circumstances facing the employer and other circumstances.

[33] Mr Brooks replied on 19 April 2013, relevantly, as follows:

Thank you for your candid response, and I agree with some of the items that you have outlined below however one thing you have neglected to add into here is the massive loss of funds for the R&D job that you worked on and that WCIS continue to pay you even though you continue to make error after error!

My question was why don’t we advise our employees when their super contributions are paid, I know they go onto the payslips even Elorah can work this out! It appears to me that Rosemary is doing and following up most of your work, it also appears that jobs that should take 30 minutes to do seem to take you two hours to do. I will advise you now that you need to put measures into place for all the items below and all responsibilities that fall under your ROLE because you are and will be held accountable for all of these and other areas that pertain to you as HEAD of accounts. (sic)

[34] Mr Brooks’ email correspondence serves as a warning to the Applicant that he fully expected her to alter her approach to work and to be accountable for her areas of responsibility. The tone of the correspondence would have been unsettling to the Applicant, and no doubt would have caused her to feel herself under some increased pressure.

[35] But for all of that, the correspondence, when read objectively, whilst it conveys a warning in strong terms, it is not abusive in tone. Nor does the email suggest that the Company was intent on harassing the Applicant, or that it had set out to cause her to resign her employment. To the contrary, Mr Brooks sought an improved performance into the future. Indeed, in the first component of the email, Mr Brooks thanks the Applicant for part of her response and expresses agreement with her in respect of some matters.

[36] In all, Mr Brooks’ conduct (at least as evidenced through the window of his email exchanges with the Applicant) seem to fall within the scope of meaning of reasonable management actions taken in a reasonable way when framed in the particular context.

[37] As mentioned above, the Applicant also claimed that she had been subject to vindictive and malicious conduct by Ms Alex Peters, Ms Wishlow’s secretary. There is some email correspondence between Ms Peters and the Applicant in the evidence, but before it is considered some background is required.

[38] When it was discovered that the R&D taxation concession application had not been registered on time to attract the concession, an approach was made by Ms Peters, it appears, to AusIndustry to accept a late application. To this end, it seems as though AusIndustry was prepared to allow for the late registration for the concession if a person with knowledge of the process provided a statutory declaration explaining the circumstances.

[39] It was in relation to this matter that on 22 April 2013 Ms Peters corresponded with the Applicant by e-mail. In that e-mail Ms Peters indicated that she had spoken to AusIndustry in regards to an appeal in relation to the late registration for the tax concession. In this context, Ms Peters emailed the Applicant and informed her (as AusIndustry had indicated) that the Company needed:

To enclose a statutory declaration of a person with first-hand knowledge which would be you. (They also need one from Steve which I will send shortly)

As you suggested sympathy is key so we outlined your workload at the time as well as explaining that in your view, it was a misunderstanding in regards to renewals. If you want to change the wording slightly please discuss today but the lady was very kind, she understood the situation and basically told me what to put in it, fingers crossed!

Please add your Company address. I have made an appointment for you at 11:30am tomorrow very nearby to sign it in front of a Commissioner of Declarations.

[40] This item of correspondence is quite professional in tone and does not evince any sustained or implied criticism or abuse or vindictiveness on the part of Ms Peters. Some of the light-hearted phrasing of the correspondence certainly does not suggest any acrimony in the underlying relationship between Ms Peters and the Applicant. It also seems as though the Applicant had been discussing the matter with Ms Peters previously in respect of the approach to take.

[41] The Applicant’s response to the request for a statutory declaration demonstrated, however, that she had developed a strong suspicion of the Company by this juncture:

Hi Rosemary/Steve,

I will sign this Statutory Declaration on one condition, that I am assured it will be used to back up the R & D late Registration application and no other purpose.

After verbally being threatened with legal action on more than one occasion, I do not feel comfortable at all signing such declaration without legal consultation.

I have done whatever I could for the company, to the best of my ability and knowledge. I have saved the company significant amount in taxes and gs, not limited to these. The manner in which WCIS is probing into my personal affairs makes me feel very uncomfortable.

If there is no trust between the 2 parties than there should not be a contractual relationship between WCIS and me. I need to know where I stand in this regard. (sic)

With Kind regards,

[42] Ms Wishlow replied as follows:

Hello Tara

If the R and D had have been done right in the first instance I feel that we would not even be exchanging emails regarding the Statutory Declaration, any legal talk is purely because of the lack of registering for the R&D. Please sign this so we can move forward and get this debacle resolved and hopefully get our money back! 

[43] While the Applicant believed herself to be facing a legal threat of some kind (the nature of which was never made out with any particularity), Ms Wishlow’s reply reveals a reluctance to engage in any underlying issues and to get on with resolving the business issue. Like Mr Brooks’ email earlier, Ms Wishlow envisages a future in which the current problems are resolved. None of this suggests to me that the Respondent was embarking on a course of conduct intended, for example, to rid itself of a quarrelsome or underperforming employee.

[44] If I so conclude from the correspondence, I do so equally on the basis of the direct evidence about the wider interactions between the parties.

[45] Ms Wishlow gave evidence that when the parties met on 1 May 2013, they discussed the various issues in a calm manner and the Applicant, without any overt emotional display informed her that that she would resign her employment. She left the room and about 15 minutes later came back with a resignation letter. After some discussion, including the accuracy of some of the accruals asserted in the letter, the letter was revised and then finally submitted. It is in the terms set out above.

[46] The Applicant gave an entirely different construction of the exchanges that occurred. The Applicant claimed that she was forced to resign and the resignation letter had been effectively imposed upon her. The resignation was not a voluntary act on her part, indeed quite the opposite.

[47] In the Applicant’s narrative, the imposition of the resignation letter was the culmination of the course of conduct engaged in by the Respondent in which the Respondent had blamed her for accounting and taxation deficiencies that were not her responsibility and had threatened and harassed her.

[48] Having heard the evidence in this matter, I find the Applicant’s claims in to be lacking all credibility. Over the course of her evidence the Applicant made various claims that were entirely unbelievable and which were fatal to her credibility as a witness.

[49] The Applicant’s various explanations around her membership of the ICAA were a case in point. Here, the Applicant (contrary to what the Respondent claimed it had been led to believe) claimed initially not to be a chartered accountant, but to be a member of the ICAA. 1 This difference, it was suggested, led to the Respondent’s confusion:

I was just a member, not a chartered accountant [...] I was just a financial member [...]. 2

[50] The Applicant then claimed, however, she was a member of the National Tax Accountants Association (NTAA) and not the ICAA because she had claimed that was, by implication, implying she was not a member of the ICAA. 3

[51] The Applicant thereafter claimed she was not a member of the ICAA, period. 4

[52] The Applicant also claimed subsequently she had had “dealings” with the ICAA but was not a member. 5

[53] When it was pointed out that her resume as retained by the Respondent expressly stated that she was a member of the ICAA she claimed the document was not her document (and that her resume was a different document). 6

[54] The Applicant later held that the reference in the resume was a “typo”. 7

[55] Another instance was that the Applicant claimed that she had never composed email correspondence concerning the terms of her engagement with the Respondent even though it was in her name (and which would have been possibly adverse to her claims in relation to another jurisdictional objection).

[56] The Applicant claimed the Respondent must have composed the email as part of a conspiracy to undermine her case and standing. But the email had been in the materials filed in this matter since July 2013, a period of 4 months, and the Applicant, despite her attentiveness to the claims and counter claims, never raised this serious allegation prior to the hearing.

[57] The claim, made in the course of the viva voce evidence, lacked any authenticity.

[58] The Applicant also made claims in the course of the proceedings that the Company had concocted its financial affairs to commit a fraud against the Commonwealth. There was no evidence of such conduct. The manner of the assertion of such a claim, in the absence of any evidence or developed argument whatsoever, and without any prior claims having been made of any such kind in the Applicant’s evidence, very much suggests the Applicant was contriving her evidence for effect.

[59] Generally, the Applicant asserted various claims with little consideration for the evidentiary basis. Simply, they cannot be believed reasonably.

[60] Ms Wishlow’s narrative of events lacked any of the hallmarks of concoction and was presented in a matter of fact fashion that contrasted sharply with that of the Applicant. In particular, Ms Wishlow’s construction of the meeting of 1 May 2013, in which the Applicant purportedly resigned her employment, was a more reliable account than that of the Applicant. The sequence of steps in the discussion through to the execution of the resignation letter was seamless and credible.

[61] Ms Wishlow’s evidence is to be preferred.

[62] And that evidence is to the effect that the Applicant was presented with the management accountant’s report, referred to above, and questioned about her qualifications, and in response the Applicant “resigned on her own accord”.

[63] No doubt other matters than those raised in the meeting of 1 May 2013 were on the Applicant’s mind. There had been tensions in the relationship since around mid April 2013, in particular, and I have set some of this material out above.

Conclusions

[64] Putting aside who was ultimately responsible for the R&D taxation problem, the more pressing question is did the course of conduct of the employer in this respect force the Applicant to resign her position with the Company?

[65] On the face of the materials before me, the answer to that question must be in the negative.

[66] There are demonstrable tensions between the Applicant and the Respondent over the entire matter.

[67] But the Company’s e-mail responses to the Applicant do not suggest that it was participating in a course of conduct the intended result of which was to bring about or foment the dismissal of the Applicant.

[68] Mr Brooks’ correspondence no doubt caused concern to the Applicant. But it did not constitute a threat as such, but more a warning and a clearly stated expectation about future performance.

[69] Ms Wishlow merely indicated an intention to “move forward and get this debacle resolved and hopefully get our money back!” No doubt the Company was likely to have been persistent that the Applicant provide a statutory declaration in the taxation appeal matter. Her role as Group Financial Controller would have been critical to the success of any such appeal process (as Ms Peters’ correspondence had indicated).

[70] There was no express or implied threat to the Applicant in the e-mail correspondence that reasonably could be taken to have caused her to resign her employment.

[71] Equally, the personal interactions between the Applicant and the Respondent seem to have retained some civil tone. This was evident in Ms Wishlow’s reconstruction of the circumstances of the Applicant’s resignation.

[72] I have no doubt that the Respondent’s probing of the Applicant’s skills and performance and her asserted professional qualifications caused her considerable anxiety. But in the face of the management accountant’s report and the difficulties that had arisen in the financial affairs of the business, these enquiries were not unreasonable. Nor were the enquiries pursued in an inappropriate manner.

[73] Even if I consider the concerns held by the Applicant in the aggregate, I cannot conclude that they demonstrate on an objective basis that the Applicant had no reasonable choice but to resign her position on 1 May 2013.

[74] The relationship between the Applicant and the Respondent at the relevant time was subject to a deal of stress. There were multiple and related concerns about the Company’s cash flow, deficient taxation accounting practices, and the role the Applicant’s purported professional qualifications played in these regards.

[75] The parties may well have been mutually suspicious of each other, to some measure, over the course of April 2013 in particular (when the R&D tax concession issue came to the fore).

[76] But for all of that, the evidence does not suggest, either in its discrete components or in its general presentation, that the Respondent (in some direct or consequential manner) was engaged in a course of conduct which left the Applicant with no reasonable choice but to resign her employment.

[77] Indeed, when the Applicant came to resign her employment on 1 May 2013, she did so on one month’s notice, consistent with the terms of her employment contract. The Applicant did not immediately cease the relationship with the employer and abandon her employment (owing to the impossibility, perhaps, of interacting any longer with Ms Wishlow, or Ms Peters or Mr Brooks, or in some way being associated at all with her former employer).

[78] I add that the Applicant did make some intermittent claims that she had received some psychological support, but there was no developed evidence or submission in this regard, and very little could be made of the Applicant’s occasional claims. Whatever those claims might have been they did not stop the Applicant claiming she was adamant that she had wished to work out the entirety of her notice period. 8

[79] Ordinarily, an employee who is forced to resign their employment because of the course of conduct of the employer will resign immediately because the relationship has reached such a point that it is no longer sustainable and there can no longer be personal service of the contract of employment. The sudden and comprehensive repudiation of the employment relationship is often indicative of the difficulty in the employment relationship at the relevant time.

[80] Here, however, the Applicant maintained the relationship for a further month upon giving notice of her resignation. I do note further, as the Applicant for her part indicated in the course of the proceedings, that had she not fallen ill following the handover a few days into her notice period, she would have continued to provide services to the Respondent.

[81] The conduct of the Respondent, therefore, had not been so odious or repugnant so as to cause the Applicant to repudiate immediately the presumed employment relationship.

[82] Surveying the evidence, I conclude that whilst there is no doubt at all that the Applicant was uncomfortable with the issues that had arisen in the employment relationship, she at all times had available to her other options than to resign her employment. A frank discussion of her professional qualifications and experience, and a willingness to participate in a strategy to address the state of the accounts etc might have been one such option. It seemed to me on the evidence the Respondent was very much more focussed on fixing the financial and taxation problems it faced rather than finding a scapegoat, if I can put it that way.

[83] On an objective basis, the circumstances of this matter do not demonstrate that the Applicant had no reasonable choice but to resign her employment or that she was forced to resign her employment because of the conduct or course of conduct of the Company.

[84] I therefore find that the Applicant, had she been an employee at the time of her dismissal as she insisted she was, resigned her employment by the exercise of her own volition, and not for reason that she had no other reasonable course of action open to her. Consequently, the Company cannot be taken to have dismissed the Applicant at its own initiative for the Act’s purposes.

[85] The application under s.394 of the Act is therefore dismissed as it is outside of the Commission’s jurisdiction.

[86] I add finally that because I have so found, it is not necessary that I make separate findings in respect of the remaining two jurisdictional objections moved by the Respondent.

SENIOR DEPUTY PRESIDENT

Appearances:

Ms R. Singh, Applicant

Mr H. Lepahe, of Australian Business Lawyers and Advisors, for the Respondent

Hearing details:

Brisbane

2013

15 November

 1   Transcript of proceedings dated 15 November 2013, at PN768.

 2   Transcript of proceedings dated 15 November 2013, at PNS768-769.

 3   Transcript of proceedings dated 15 November 2013, at PNS776-780.

 4   Transcript of proceedings dated 15 November 2013, at PNS776-780.

 5   Transcript of proceedings dated 15 November 2013, at PN940.

 6   Transcript of proceedings dated 15 November 2013, at PNS784-786; PN790.

 7   Transcript of proceedings dated 15 November 2013, at PN943

 8   Transcript of proceedings dated 15 November 2013, at PN1198.

Printed by authority of the Commonwealth Government Printer

<Price code C, PR544840>