Nelson De Sousa v Just Skip Bins Pty Ltd

[2023] FWC 2050

[2023] FWC 2050

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Nelson De Sousa
v

Just Skip Bins Pty Ltd

(U2023/3621)

DEPUTY PRESIDENT CROSS SYDNEY, 16 OCTOBER 2023

Application for an unfair dismissal remedy

1. Mr Nelson De Sousa (the Applicant) was employed as an Accounts Administration Manager by Just Skip Bins Pty Ltd (the Respondent) from 23 November 2021, until he was dismissed on 26 April 2023. The Applicant was employed pursuant to the Waste Management Award (the Award) on a salary of $85,000p.a.

1. On 28 June 2023, directions were issued to program the manner in which the Application was to proceed to hearing (the Directions). The Applicant filed his materials, consisting of a submission and a Statement of the Applicant, nine days after their due date pursuant to the Directions.  On 21 July 2023, the Respondents representative wrote to my Chambers noting the Applicants non-compliance and seeking the matter to be dismissed by want of prosecution. The matter was listed for an interim hearing on the Respondent’s application on 26 July 2023, at which that application for dismissal for want of prosecution was dismissed.

1. On 26 July 2023, after the conclusion of the interim hearing, the Directions were varied (the Amended Directions). The parties complied with the Amended Directions, in particular:

(a) On 9 August 2023, the Respondent filed an Outline of Submissions, with a Witness Statement from Mr John Scarlis, a Director of the Respondent, and;

(b) On 14 August 2023, the Applicant filed a witness statement in reply.

1. The Hearing of the Application occurred on 16 August 2023 (the Hearing).

Background Facts

1. Outlined below are the facts as I have found them to exist. The determination of some of those facts has involved determining facts where varying recollections existed between the Applicant on one hand, and Mr Scarlis on the other. Where such variation existed, I have preferred the evidence of Mr Scarlis, who gave considered and truthful testimony, readily making concessions against the Respondent’s interests where appropriate.

1. The Applicant, on the other hand, clearly sought to tailor his evidence to portray himself in a manner that he thought would most assist his case, regardless of truth. He was deliberately non-responsive to questions put to him, particularly regarding previous customer complaints, having denied the evidence of those complaints in his Statement in Reply.

1. On 12 November 2021, the Applicant received an email from Mr Harry Scarlis with an offer of employment. On 16 November 2021, the Applicant received a formal letter of offer. It relevantly stated:

Letter of Offer

I am pleased to offer you employment in the position of Accounts Administration Manager with us at Just Skip Bins Pty Ltd ('the employer') on the terms and conditions set out in this letter.

1. Position

1.1      Your start date with the employer is 23 November 2021.

1.2      Your employment will be Full Time.

1.3      The duties of this position are set out in the attached position description. You will be required to perform these duties, and any other duties the employer may assign to you, having regard to your skills, training and experience.

1.4      You will be required to perform your duties at 39 Grand Avenue, Camellia NSW 2142, or elsewhere as reasonably directed by the employer.

…

8. Termination of employment

8.1 Under the Fair Work Act 2009 the employer may terminate your employment at any time by providing you with notice in writing in accordance with this table:

Length of continuous service with employer	Period of notice
Not mor& than 1 year 1 week	1 week
More than 1 year but less than 3 years	2 weeks
More than 3 years but less than 5 years	3 weeks
More than 5 years	4 weeks

8.2      You are entitled to an additional week's notice if you are over 45 years old and have completed at least 2 years of continuous service with the employer on the day the notice of termination i& given.
8.3      If you wish to terminate your employment you are required to provide the employer with prior notice in accordance with the table at 8.1 above.

1. On 28 December 2021 an email was received by the Respondent from a customer which relevantly stated:

Hi Marco,

I write this email to you now as I have discussed with you and would also like this on record.

Recently, one of your new account managers had contacted us regarding an overdue account. Generally, I would be fine with him contacting us, and asking for when payment would be received, but given his choice of words and mannerism during the phone conversation, seemed to be threatening and disturbing.

I understand that overdue accounts are never a good thing, but understandably we are a small team running fairly large jobs, with no accounts personnel working full time, leaving us in charge of the accounts payable/receivable, along with estimating and delivering projects successfully. These phone calls generally do not bother me, but when I get contacted by someone I have never dealt with, get told that I owe a significant amount (approx. $32,000 + GST), and that he wanted a phone call by the end of the day with a confirmed date for payment, or he will have the account put on hold, and will advise your directors to commence legal proceedings.

Marco, I understand he has a job to do and is following up with payment, but we have never not paid, and are only ever behind because of no personnel handling accounts.
Marco, if it were not for the professional relationship and trust we have built with yourself, Maree and Johnny, we wouldn't be having this conversation and would be closing the account, and I want to send this just so that we can ensure that no one from either side get spoken to like this again.

I trust you will deal with this in the strictest of confidence and professionalism, and if there is anything further you wish to discuss, please do not hesitate to contact me.

[Emphasis added]

1. Mr Scarlis had a conversation with the Applicant regarding the above email and he said words to the effect of “You're doing good work here Nelson, but we cannot communicate  with customers in the manner you did, whether or not they are late with payments - we have to be courteous, polite and respectful at all times” and “Your good work will be for nothing if your conduct is such that  the reputation of this business is trashed. We cannot have that." 

1. Following this conversation, the Applicant proceeded to take an unexplained absence from work. Mr Scarlis’ evidence, which I accept, was:

14.      Unfortunately during the course of the next 15 months of the Applicant’s employment he continued to [have] behavioural issues at work surrounding interaction with co-workers and customers on multiple occasions.

15.      These incidents related to blunt and passive aggressive communication from the Applicant to other staff members (relating to the other members having done a task, or that staff member allocating a task to the Applicant) and customers (in relation to the chasing of outstanding invoices or the querying of details in the invoices that the customer required clarification).

1. I accept Mr Scarlis reprimanded the Applicant following these complaints, however those reprimands were more supportive, encouraging the Applicant to deal with customers in a courteous and polite manner. Mr Scarlis’ evidence in his statement was:

The Applicant’s responses and demeanour during each of our conversations (and my reprimanding of his behaviour) were similar to his demeanour as outlined earlier above in my statement at paragraph 11. In particular, the Applicant never denied any of the allegations made against him as to his behaviour and poor communication.

1. In or around October 2022 to November 2022, Ms Stephanie Sakellar was hired as a Financial Accountant by the Respondent. Soon after, a Ms Turner, was hired to work with the Allocations Manager.

1. The Applicant was soon involved in an investigation where it was alleged by Ms Turner that the Applicant had deleted emails from her computer. The Applicant denied the allegations. Following an investigation, the Respondent concluded and confirmed that the Applicant had not deleted the emails, and it had in fact been Ms Turner who deleted them. Ms Turner was subsequently terminated. Whilst this issue was not cited as a reason for the Applicant’s dismissal, the Applicant sought to rely on it to demonstrate the start of a declining relationship with the Respondent.

1. The Applicant further submitted that on or around 6 April 2023, he had an altercation with another staff member. The Applicant asserted that Mr Adam Crooks approached him, requesting that he finalise two sales matters. The Applicant submitted that he attempted to clarify a couple of issues in relation to Mr Crooks request, and he was met with a hostile reaction. The Applicant left work. When this issue was raised with Mr Scarlis, he decided to act in relation to the Applicant’s conduct. Mr Scarlis’ evidence was:

After this was reported to me, and given this was consistent with the Applicant's prior conduct, I felt that the Applicant needed a final warning (and a specific one that informed him that his employment with the Respondent would be terminated if he continued to act in such a manner).

I had showed much patience but I was now of the view that the Applicant would not change. 

But I also appreciated he needed this final warning as matter of fairness.

That the Applicant provided a Doctor Certificate , with a general " unfit for work" reason, made me confident that the Applicant's conduct would not change and he needed this final warning.

1. The Applicant sought to rely on a text message exchange with Mr Scarlis, as follows:

Thu, 6 April, 13:14

Mr Scarlis:
I’m in an appointment mate I’m available via text only

Mr Scarlis:
Nelson I cannot talk

Mr Scarlis:
Just text me

The Applicant:
Sorry mate. I’ll leave a voice msg

…
Thu, 6 April, 15:53

Mr Scarlis:
Hello mate just listened to it. Adam apologized to me and said he shouldn’t have said that and he wants to sit down on Tuesday and just put it all to bed and move forward with respect and harmony

The Applicant:
Hi Mate, my apologies, and thank you, for your time with this.

Its water under the bridge. I had to leave as he looked pretty aggressive and confrontational, Steph was out in her lunch break, and I thought in de-escalating the situation for both parties: Adam…and myself (laughing emoji)

Don’t get me wrong please, John, but, as you said Adam apologised, considering that we all want to simply (keep) move(ing) forward, I would modestly suggest putting this matter to bed from now onwards, possibly, without the need of a sit down – although the situation awarded an unusually and demandingly challenging scenario in front of colleagues, I’m able to say that, at the moment, I’m cool as cucumber “and/or” lettuce in the fridge (you got to love the “and/or”, that is where the joke lays

Thanks, John, enjoy your weekend too

If you still want to talk give me a call otherwise enjoy your weekend.

Mr Scarlis:
All good mate still want everyone to sit down and keep a harmonious office

The Applicant:
(Ok, but it’ll be an heavy duty day, mate – lots of emails, invoices … just from thinking about it, I’m having an headache)

Mr Scarlis:
It’s a general chat not a specific email stuff so no stress

1. On 20 April 2023, the Applicant was involved in an altercation between two other staff members. The Applicant left work after the altercation without notice. The Applicant claimed he left work early as he began to develop symptoms of a panic attack.

1. On the morning of 24 April 2023, the Applicant exchanged the following messages with Mr Scarlis:

The Applicant:

Good morning John,

If whenever you can, I would like to have a word with you please.

Cheers,

Mr Scarlis:

Good morning mate I planned to talk to you this morning I’ll be in shortly

1. Later that morning a meeting occurred. At that meeting the Applicant said, "I need tools to be provided so that I could, at least, effectively and accurately, address the workload and completing it within time frames stipulated", Mr Scarlis responded “look, if you can't do your job then you need to hand in your resignation”.

1. The Applicant left work without notice. At 12:55pm on 24 April 2023, the Applicant sent a text message to Mr Scarlis. It relevantly stated:

The Applicant:

Hi John,

Sincerely, I didn’t want nor expected to see you upset as such was not my intention with our unfinished conversation.

I also wasn’t aware that everyone wants to see my employment with KLF group terminated.

Unfortunately, from what I was able to gather and made feel, few situations in the workplace left me “shaken” or, within the scarcity of a better term “agitated”, which apart from the above mentioned impact on myself, appear to be rubbing on my work, I’m unsure.

Therefore, please note that I’m addressing it and will keep you updated as soon as possible.

Thanks in advance.

1. Mr Scarlis immediately attempted to call the Applicant, however there was no response.

1. The Applicant stated (and Mr Scarlis did not deny) that Mr Scarlis called once more, and they had a conversation where Mr Scarlis asked the Applicant to return his work property immediately and inquired whether he wished to continue his employment with Just Skip Bins. The Applicant stated that he told Mr Scarlis he needed to consult with his general practitioner first before providing an answer.

1. Following the above conversation, a text message exchange occurred as follows:

The Applicant:

As per your request, I’m at home and unable to leave. If you, or anyone else, can pick the keys up, I’ll be available to deliver it.

…

Mr Scarlis:

Nelson I didn’t request you to leave but I did request you to return all property. You were asked to make a decision before you left.

In any case someone will be by to collect our property.

You cannot abandon the office because someone has addressed a recurring behavioural problem with you.

You need to provide me with your decision on whether you want to continue your employment.

1. The Applicant failed to provide a response to the Respondent’s directions, and the Applicant dispatched the following text messages:

The Applicant:

Your property is ready to be collected, John.

As shared with you on the phone, I’m not feeling very well, however I am addressing it, after which, this coming Wednesday 26/04/2023, I’ll be updating you.

The Applicant:

Due to what I was experiencing and feeling at that time, I ended up leaving without saying anything and I’m truly sorry for that

1. On 26 April 2023, at 1.38pm, the Respondent sent an email terminating the Applicant’s employment as follows:

Hi Nelson,

The team has discussed this, and this isn't the first time you have left the workplace without cause when a behavioural issue has been attempted to be addressed by management.

We have discussed with you on numerous different occasions as to how to conduct yourself with your colleagues and customers and have given you multiple warnings.

As such a medical certificate stating that you have a medical condition will not suffice to justify your recent absence and behaviour.

Given the behavioural issues have resulted in a poor working environment with all your colleagues, and customers, and the fact that you have been given multiple warnings about such issues during your employment at Just Skip Bins, we feel that its best we part company. As such we will be paying you two weeks' notice and wish you all the best in the future.

The final payment date is 10/05/2023 which will be paid in tomorrow's pay run. Thanks.

1. Mr Scarlis’ evidence focused on the Applicant’s absences from work when approached to be reprimanded and/or warned. Mr Scarlis’ evidence was:

23 . More worrying for me, the Applicant, on each of the occasions that I reprimanded him, would proceed to either:

(a)       leave work early (usually an hour before his work hours cessation) right after our meeting, which usually took place in the late afternoon; or

(b)       on occasion the Applicant would leave work early as above and also take a leave of absence without cause or notice the very next day.

1. On 26 April 2023, at 4.39pm, the Applicant sent the Respondent two medical certificates. Those certificates provided:

THIS IS TO CERTIFY THAT

Mr Nelson Eduardo DoSantos De Sousa

IS RECEIVING MEDICAL TREATMENT AND FOR THE PERIOD

FRIDAY,  21 April 2023  TO Friday 21 April 2023 INCLUSIVE

This certificate was completed on 26/4/2023

Dr Adrian Lim

…

THIS IS TO CERTIFY THAT

Mr Nelson Eduardo DoSantos De Sousa

IS RECEIVING MEDICAL TREATMENT AND FOR THE PERIOD

Wednesday,  26 April 2023  TO Friday 28 April 2023 INCLUSIVE

He WILL BE UNFIT TO CONTINUE his USUAL OCCUPATION.

DUE TO A MEDICAL CONDITION

This certificate was completed on 26/4/2023

Dr Adrian Lim

1. I accept the evidence of Mr Scarlis that the Respondent showed significant flexibility towards the Applicant and provided the Applicant with multiple chances to remedy his performance. The Applicant was aware that his behaviour towards customers and co-workers was unacceptable and was warned and reprimanded multiple times (albeit informally). Despite this leniency he continued to display the same pattern of behaviour that resulted ultimately in his dismissal.

Applicant’s Submission

1. The Applicant submitted that the Respondent did not provide a legitimate reason for dismissal of the Applicant's employment. Further, the allegations that the Applicant had behavioural issues and unexplained absences was said to be entirely disproportionate to the circumstances or alleged conduct.

1. The Applicant submitted that there was no evidence to support the conclusion that the Applicant had behavioural issues, was fabricating medical conditions, or had unexplained absences for leaving work.

1. The email issued by the Respondent terminating the Applicant’s employment was in response to an email sent by the Applicant on 25 April 2023 advising of a work absence the following day regarding an appointment with a General Practitioner. The Respondent's suggestion that it was not aware at any time that the Applicant was suffering from a medical condition or mental health issue that required management was denied, and the  Applicant noted that he emailed to the Respondent a copy of the medical certificates for 21 April 2023 and 26 April 2023.

1. The Applicant submitted that no notice was provided to the Applicant of the intention of the Respondent to terminate the Applicant's employment. The Applicant was not provided with an opportunity to respond or have a support person present at the meeting on 24 April 2023, and was consulting medical health professional when the termination notice was issued.

Respondent’s Submission

1. The Respondent submitted that the factual matrix of the Applicant's employment history with the Respondent made it clear that:

(a)       During the course of the Applicant's employment with the Respondent, he was being reprimanded for behavioural issues at work surrounding interaction with co­workers and customers on multiple occasions;

(b)      The conduct was of concern relating to the potential alienating of other employees of the Respondent and customers;

(c)       The Respondent valued the Applicant's work otherwise, and decided to reprimand and guide the Applicant so that his communication skills would improve;

(d)       The Applicant, on each of the occasions that the Respondent's management attempted to reprimand and guide him, would proceed to either leave work early (an hour or so) or sometimes even take an additional entire day (without cause, notice, or explanation);

(e)       The Respondent wanted to be patient with the Applicant, and upon each return to work explained that such conduct was not acceptable;

(f)      Towards the end of his employment the Applicant's work was suffering and it became clear to the Respondent's management that its guidance and patience was not working with the Applicant, and the Applicant was refusing to complete certain tasks that fell under his responsibility; and

(g)       At the final meeting on 24 April 2023 the Applicant was given a final warning that he could not continue to conduct himself as he had if he wished to continue to be employed with the Respondent, and that he was at liberty to resign if he was unable to do the job in the manner expected of him.

1. The Respondent noted that the response of the Applicant was to again leave without notice or explanation. While the Applicant tried to claim there were medical reasons for his absence, at no time during his employment had the Applicant disclosed to the Respondent that he was suffering any mental health issue or other medical condition that the Respondent needed to manage.

1. The Respondent submitted the valid reasons for dismissal were that the Applicant exhibited poor behaviour and a poor attitude towards his team members, customers, and supervisors, and that he had a long history of performance and conduct related issues, for which he had received multiple warnings.  

1. The Respondent submitted that there were numerous warnings and notices given to the Applicant, including the final warning at the meeting of 24 April 2023, and he had an opportunity to respond to those warnings and notices.

1. The Applicant freely chose to attend the meeting of 24 April 2023, and he did not request the opportunity for a support person.

Consideration

1. There were no jurisdictional objections to the Applicant’s application being determined by the Commission. Specifically, I am satisfied that:

(a) the Applicant was dismissed at the initiative of the employer (ss 385(a) 386(1)(a));

(b) his unfair dismissal application was lodged within the 21 day statutory time limitation found at s 394(2) of the Act;

(c) the Applicant is a person protected from unfair dismissal in that:

(i) he had completed the minimum employment period set out in ss 382 and 383 of  the Act; and

(ii) his salary was below the high income threshold;

(d) his dismissal was not a case of genuine redundancy (s.385(d)); and

(e) his dismissal was not a case involving the Small Business Fair Dismissal Code (s.385(c)).

1. The only outstanding issue is whether the Applicant’s dismissal was ‘harsh, unjust or unreasonable,’ and therefore an unfair dismissal. To this end, I must direct attention to s.387 of the Act, dealing with the matters to be taken into account by the Commission in determining whether the dismissal was unfair. It is trite to observe that each of the matters must be considered and a finding made on each of them, including whether they are relevant or not.

Was the Dismissal Harsh, Unjust or Unreasonable?

1. Section 387 of the Act identifies the matters that the Commission must take into account in deciding whether a dismissal was “harsh, unjust or unreasonable:”

(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);

(b) Whether the person was notified of that reason;

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

(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;

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

(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;

(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 the FWC considers relevant.

Section 387(a) - whether there was a valid reason for the applicant’s dismissal

1. In Rode v Burwood Mitsubishi,[1] a Full Bench of the then Australian Industrial Relations Commission discussed the meaning of valid reason in the context of the relevant provisions of the Workplace Relations Act 1996, and referring to Selvachandran v Peteron Plastics Pty Ltd[2](Selvachandran). The Full Bench found:

[18] While Selvachandran was decided under the former statutory scheme the above observations remain relevant in the context of s.170CG(3)(a). A valid reason is one which is sound, defensible or well founded. A reason for termination which is capricious, fanciful, spiteful or prejudiced is not a valid reason for the purpose of s.170CG(3)(a).

[19] We agree with the appellant’s submission that in order to constitute a valid reason within the meaning of s.170CG(3)(a) the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts. It is not sufficient for an employer to simply show that he or she acted in the belief that the termination was for a valid reason.

1. I have accepted the Respondent’s evidence the Applicant exhibited poor behaviour and a poor attitude towards his team members, customers and supervisors. That behaviour constituted valid reasons for dismissal. It is clear that such behaviour persisted throughout his employment, and the Applicant received multiple warnings regarding such behaviour from Mr Scarlis.

1. While it is correct to observe that the warnings provided by Mr Scarlis focused on positive statements of required future conduct rather than expressions of the consequences of future misconduct, I am satisfied that the Applicant was fully aware that future misconduct would not be acceptable.

Procedural fairness- s.387(b)-(e)

1. Sub-sections (b) - (e) of s 387 of the Act may be broadly characterised as issues relevant to whether a dismissed employee was afforded procedural fairness. It is correct to observe that, even if there was a valid reason for an employee’s dismissal, the dismissal may still be held to be unfair if the employee was not afforded procedural fairness. This has been a long held industrial principle adopted and applied by this Commission,  its predecessors, and Courts.

1. In Wadey v Y.M.C.A. Canberra,[3] Moore J made clear that an employer cannot merely pay lip service to giving an employee an opportunity to respond to allegations concerning the employee’s conduct. His Honour said:

‘In my opinion the obligation imposed on an employer by that section has, for present purposes, two relevant aspects. The first is that the employee must be made aware of allegations concerning the employee's conduct so as to be able to respond to them. The second is that the employee must be given an opportunity to defend himself or herself. The second aspect, the opportunity to defend, implies an opportunity that might result in the employer deciding not to terminate the employment if the defence is of substance. An employer may simply go through the motions of giving the employee an opportunity to deal with allegations concerning conduct when, in substance, a firm decision to terminate had already been made which would be adhered to irrespective of anything the employee might say in his or her defence. That, in my opinion, does not constitute an opportunity to defend.’

1. Nevertheless, procedural fairness steps should be applied in a commonsense and practical way. In Gibson v Bosmac Pty Ltd,[4] Wilcox CJ said at 7:

‘Ordinarily, before being dismissed for reasons related to conduct or performance, an employee must be made aware of the particular matters that are putting his or her job at risk and given an adequate opportunity of defence. However, I also pointed out that the section does not require any particular formality. It is intended to be applied in a practical, commonsense way so as to ensure that the affected employee is treated fairly. Where the employee is aware of the precise nature of the employer's concern about his or her conduct or performance and has a full opportunity to respond to this concern, this is enough to satisfy the requirements of the section.’

1. While I am satisfied there were valid reasons for the Applicant’s dismissal, I am not satisfied that the process leading up to, and including the Applicant’s dismissal, was fair. In particular, the Applicant:

a)was not made aware of the purpose of the meeting on 24 April 2023 (s 387(b));

b)was not given any opportunity to defend the recent allegations of poor performance or explain his conduct (s 387(c)). Had the Applicant been made aware of the purpose of the meeting, he may have requested to have a support person attend with him (s 387(e)); and

c)was simply told “look, if you can't do your job then you need to hand in your resignation”.

1. The reason for dismissal in the email terminating employment actually deviated in part from the issues discussed on 24 April 2023, and went to issues of the absence from work on 24 April 2023, and the anticipated contents of medical certificates. The Applicant was not given the opportunity to respond regarding those issues.

1. I do not, however, consider the medical certificates tendered by the Applicant assisted the Applicant. The certificates were provided to the Respondent after the termination email was sent,[5] and the relevant certificate for the purposes of explaining the Applicant’s last absence was that relating to 21 April 2023. That certificate was remarkable as it was not completed until 26 April 2023, and did not assert the existence of a medical condition unlike the other certificate also completed on 26 July 2023.

Size/Human Resource Specialists ss 387(f), (g)

1. The conduct of the Respondent was consistently marked by positive attempts to secure better conduct and performance from the Applicant, and I accept that the Respondent is a relevantly small business with little experience in such matters (ss 387(f),(g)). The Respondent conveyed an extreme amount of flexibility and patience towards the Applicant throughout his employment.

Conclusion

1. I have made findings in relation to all matters specified in section 387 as relevant. I must consider and give due weight to each as a fundamental element in determining whether the termination was harsh, unjust or unreasonable and therefore an unfair dismissal.

1. While I have found the Respondent had valid reasons for the dismissal of the Applicant, I consider on balance that the dismissal of the Applicant was harsh, unjust or unreasonable due to failures in procedural fairness. Those failures in procedural fairness can be explained in part by the size of the Respondent’s enterprise, however that does not disturb my overall finding that the dismissal of the Applicant was harsh, unjust or unreasonable. 

REMEDY

1. The Applicant does not seek reinstatement or re-employment. Given all the circumstances, I consider reinstatement is inappropriate (s 390(3)).

1. S 392 of the Act sets out the matters the Commission must take into account when assessing compensation for unfair dismissal. These are:

‘(2)  In determining an amount for the purposes of an order under subsection (1), the FWC 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 the FWC considers relevant.’

Misconduct reduces amount
(3)  If the FWC is satisfied that misconduct of a person contributed to the employer's decision to dismiss the person, the FWC 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 the FWC 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 the FWC 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.

(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.

1. As noted by the Full Bench in Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries,[6] the well-established approach to the assessment of compensation under s.392 of the Act is to apply the “Sprigg formula” derived from the Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul’s Licensed Festival Supermarket.[7] This approach was articulated in the context of the Act in Bowden v Ottrey Homes Cobram and District Retirement Villages.[8]

The effect of the order on the validity of the employer’s enterprise – s.392(2)(a)

1. There was no submission that there would be any effect of the order on the viability of the employer’s enterprise.

The length of the person’s service with the employer – s.392(2)(b)

1. The Applicant’s period of employment was approximately 16 months. The Applicant’s length of service does not weigh in favour of reducing or increasing the amount of compensation ordered.

The remuneration that the person would have received, or would have been likely to
receive, if the person had not been dismissed – s.392(2)(c)

1. The assessment of the length of continued employment is a discretionary decision. It is clear that by the time of the Applicant’s dismissal the relationship between the Applicant and Respondent had seriously deteriorated, to the extent that it was unlikely to continue for any significant period thereafter.

1. I consider the Applicant’s employment would only have continued for a period to allow for procedural fairness to be afforded to the Applicant. I estimate that the Applicant’s employment would have continued for a further two weeks, which would allow for sufficient time for the Respondent to notify the Applicant of the reasons for dismissal, provide an opportunity for him to respond and to give him notice of his dismissal.

Mitigation/Remuneration Earned – s.392(2)(d) and (e)

1. There was no evidence regarding the Applicant earning any monies in mitigation of his loss.

Other Matters Relevant – 392(2)(g)

1. The Applicant received two weeks’ pay in lieu of notice as required by the National Employment Standards (s 117). I make no deduction because of that payment as I consider that the Respondent would have made such notice payment after having accorded procedural fairness to the Applicant.

Misconduct reduces amount – 392(3)

1. Section 392(3) of the Act provides:

(3) If the FWC is satisfied that misconduct of a person contributed to the employer's
decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

1. In Butterfly Systems Pty Ltd v Sergeev,[9] the Full Bench of the Commission found:[10]

Two relevant considerations arise from the terms of the provision. Firstly, the specific use of the term “misconduct”, as opposed to “serious misconduct”, indicates that conduct of less severity than that encompassed in the definition of serious misconduct in Regulation 1.07 of the Fair Work Regulations 2009, is within the purview of the provision. Secondly, the provision requires the Commission to reduce the amount of compensation it would otherwise order by an appropriate amount, on account of misconduct, if satisfied that the misconduct contributed to the employer’s decision to dismiss.

1. The conduct of the Applicant constituting valid reasons does not satisfy the definitions of either misconduct or serious misconduct. I do not consider it appropriate that compensation ordered should be reduced.

Conclusion and order as to remedy

1. I consider that reinstatement is not an appropriate remedy and that an award of compensation is appropriate. I estimate the Applicant would have received a further two weeks remuneration had he not been terminated (the Compensation Payment).

1. I make no deduction for contingencies, consider the impact of taxation on the amount needs no accommodation, and note the Compensation Payment will be subject to the deduction of taxation. The Compensation Payment is below the compensation cap (ss 392(5), (6)).

1. The Compensation Payment, less any required deduction in taxation, is to be made within 21 days of this decision. I consider that such a result satisfies the ‘fair go all round’ test in s 381(2) of the Act.

1. The parties are directed to confer and provide agreed orders as to the gross and net amounts of two weeks ordinary pay to the Applicant within seven days from the date of this decision. In the absence of agreement, brief written submissions should be provided by that date to enable me to determine the appropriate amount to be included in any order for payment.

DEPUTY PRESIDENT

Appearances:

Miss Rodrigues, A (Solicitor from  ) for the Applicant

Mr Theodoropoulos, J (Solicitor from ) for the Applicant

Hearing details:

16 August 2023.

In-Person.

10:00AM.

<PR765264>

[1] Print R4471, at [18] and [19].

[2] (1995) 62 IR 371

[3] [1996] IRCA 568.

[4] (1995) 60 IR 1.

[5] Transcript PN 674 to 679.

[6] [2016] FWCFB 7206, at [16].

[7] (1998) 88 IR 21.

[8] [2013] FWCFB 431.

[9] [2021] FWCFB 18.

[10] Ibid at [35].

Printed by authority of the Commonwealth Government Printer