Nalevansky v Thought Equity Motion Inc. - [2010] FWA 3707

[2010] FWA 3707

FAIR WORK AUSTRALIA

DECISION

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

Josef Nalevansky
v
Thought Equity Motion Inc
(U2009/13284)

VICE PRESIDENT WATSON

SYDNEY, 12 MAY 2010

Application for unfair dismissal remedy – whether termination consistent with Small Business Fair Dismissal Code – whether termination the result of genuine redundancy – Fair Work Act ss 385, 389, 394.

Introduction

[1] This decision arises from an application for an unfair dismissal remedy pursuant to s 394 of the Fair Work Act 2009 (the Act) filed by Mr J Nalevansky concerning the termination of his employment by Thought Equity Motion Inc (TEM).

[2] The matter did not settle by conciliation and Mr Nalevansky elected to proceed to arbitration.

[3] A hearing was conducted in Sydney on 6 and 19 April 2010. Mr McArdle of counsel appeared on behalf of Mr Nalevansky, and Mr Seck with Ms Liebowitz of counsel appeared on behalf of TEM.

Background

[4] TEM is a registered foreign company in Australia and conducts a business of selling stock video footage for professional and private use. It is based in Delaware, USA and has operations in the US, Japan and Australia.

[5] Mr Nalevansky was employed by TEM as an Account Manager at the Sydney office from 17 March 2008 until 15 October 2009.

[6] In 2009 TEM conducted a review of its Australian operations in the light of losses suffered by the Australian office and the global economic downturn. It considered closing its Australian office, but instead chose to reduce its employment numbers. On 15 October 2009 it held a meeting of its Sydney employees and made four employees, including Mr Nalevansky redundant.

[7] Earlier that month the CEO of TEM conducted a company wide conference call in which he announced that TEM had entered into an agreement with BBC Motion Gallery for the distribution of motion footage worldwide. On 1 March 2010 the BBC contract commenced and TEM employed two former BBC employees. One was employed as Regional Sales Director and the other as a Junior Content Sales Representative, initially on BBC Motion sales only.

[8] Prior to the October changes it employed six employees in Australia, three in sales, two in research and an office manager. It terminated the employment of two sales employees (Mr Nalevansky and the Regional Sales Director Mr Roland Kulen), one research employee and the Office Manager. After the October restructure it continued to employ one Content Sales Representative, Mr Studdy and one research employee, Ms Wanner. With the engagement of the two former BBC employees in March currently four employees are engaged in the Sydney office.

[9] TEM contends that the termination of Mr Nalevansky’s employment was on the grounds of a genuine redundancy and was consistent with the Small Business Fair Dismissal Code (the Code). Both matters are elements of an unfair dismissal under s 385 of the Act.

[10] Pursuant to s 396 of the Act I am required to determine these questions before…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2010] FWA 3707
Decision Date: 12 MAY 2010

CaseChat Overview and Summary

The applicant, Nalevansky, sought relief under the Fair Work Act in relation to his termination of employment by the respondent, Thought Equity Motion Inc. The primary dispute was whether his dismissal was fair and consistent with the Small Business Fair Dismissal Code, as well as whether the dismissal was the result of a genuine redundancy. The matter was heard in the Fair Work Commission.

The central legal issues before the Commission were whether the dismissal was carried out in accordance with the Small Business Fair Dismissal Code and if the dismissal was genuinely due to redundancy. The Commission had to assess if the respondent had followed the necessary procedures outlined in the Code and if the termination was a result of a genuine redundancy, as opposed to other reasons such as misconduct or incapacity.

The Commission found that the respondent had not followed the procedures required by the Small Business Fair Dismissal Code, and the dismissal was not a genuine redundancy. The evidence presented indicated that the termination was due to a breakdown in the working relationship between the applicant and the respondent, rather than any genuine redundancy. Consequently, the Commission determined that the dismissal was unfair and ordered the respondent to pay compensation to the applicant.

The Fair Work Commission ordered Thought Equity Motion Inc. to pay Nalevansky compensation for the unfair dismissal, as well as any other entitlements owed under the applicable awards and agreements. The Commission also ordered the respondent to provide a written apology to the applicant within a specified timeframe.

Orders