Nieves Calvo King v Scuderia Eastern Suburbs Pty Ltd
[2025] FWC 315
•4 FEBRUARY 2025
| [2025] FWC 315 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Nieves Calvo King
v
Scuderia Eastern Suburbs Pty Ltd
(U2024/7675)
| DEPUTY PRESIDENT WRIGHT | SYDNEY, 4 FEBRUARY 2025 |
Application for an unfair dismissal remedy – order for compensation
On 15 January 2025 I made a decision[1] in this matter in which I found that there was no valid reason for Ms Calvo King’s dismissal and that the dismissal was harsh, unjust and unreasonable having regard to all of the matters in s.387 of the Fair Work Act 2009 (the FW Act). I considered that an order for payment of compensation is appropriate and that I would determine that amount after receiving further evidence and submissions from the parties.
I issued directions for the filing and serving of material in relation to compensation on 17 January 2025. Ms Calvo King filed medical evidence, payslips and other documents on 22 January 2025. Scuderia Eastern Suburbs Pty Ltd, trading as Eastern Suburbs Automotive (Eastern Suburbs Automotive) did not file any further material in relation to the matter. As neither party sought a hearing in relation to the matter and there are no contested facts involved, I determined the matter on the papers.
Section 392(2) of the FW Act requires all of the circumstances of the case to be taken into account when determining an amount to be paid as compensation to Ms Calvo King in lieu of reinstatement. I consider all the circumstances of the case below.
Effect of the order on the viability of Eastern Suburbs Automative’s enterprise
There is no evidence before me about this matter so I am unable to conclude that an order for compensation would have an effect on the viability of Eastern Suburbs Automative’s enterprise.
Length of Ms Calvo King’s service
Ms Calvo King’s length of service was two years.
I consider that Ms Calvo King’s length of service does not support reducing or increasing the amount of compensation ordered.
Remuneration that Ms Calvo King would have received, or would have been likely to receive, if Ms Calvo King had not been dismissed
As stated by a majority of the Full Court of the Federal Court:
[i]n determining the remuneration that the applicant would have received, or would have been likely to receive… the Commission must address itself to the question whether, if the actual termination had not occurred, the employment would have been likely to continue, or would have been terminated at some time by another means. It is necessary for the Commission to make a finding of fact as to the likelihood of a further termination, in order to be able to assess the amount of remuneration the employee would have received, or would have been likely to receive, if there had not been the actual termination.[2]
Ms Calvo King was employed for a two-year period by Eastern Suburbs Automative. There is no evidence to suggest that she was unhappy working at Eastern Suburbs Automative or that she was considering leaving her employment there. Ms Calvo King’s manager, Mr Alex Stock described Ms Calvo King as follows:
Very pleasant person, a kind person, I never had any issues on a personal level with her at all. She did the job pretty well. There were no issues on a professional level either. She always did what was asked of her. There were no big problems between us at all.[3]
It is clear from Mr Stock’s evidence that Mr Stock highly regarded Ms Calvo King as an employee. I therefore find that if the dismissal had not occurred, Ms Calvo King would have continued to work for Eastern Suburbs Automative for a considerable period of time and that it is unlikely that she would have resigned or been dismissed during this time. Given that Ms Calvo King worked for a period of two years, it is reasonable to assume that she would have been employed for a further period of two years. I have therefore determined that the period that Ms Calvo King would have continued to work for Eastern Suburbs Automative is two years (104 weeks) that is, until 1 July 2026.
Payslips produced by Ms Calvo King show that her gross weekly pay at the time of the dismissal was $1,009.62 plus $116.11 superannuation. Superannuation will increase to 12% on 1 July 2025. I therefore find that the remuneration that Ms Calvo King would have received, or would have been likely to receive, if Ms Calvo King had not been dismissed is $117,338 which is calculated as follows:
[($1,009.62 + $116.11[4]) x 52] + [($1,009.62 + $121.15[5]) x 52] = $117,338
Efforts of Ms Calvo King to mitigate the loss suffered by Ms Calvo King because of the dismissal
Ms Calvo King must provide evidence that she has taken reasonable steps to minimise the impact of the dismissal.[6] What is reasonable depends on the circumstances of the case.[7]
Ms Calvo King has not worked since the dismissal due to a workplace injury for which she is currently receiving workers' compensation payments.
Ms Calvo King provided an email from her rehabilitation provider dated 14 January 2025 which confirmed that throughout January 2025, Ms Calvo King has been engaging in a weekly Job Seeking Program and that she has been looking online for suitable jobs for 30 minutes each day on the advice of her psychologist. The email from the rehabilitation provider listed a number of job advertisements that Ms Calvo King might be interested in applying for and indicated that Ms Calvo King advised that she would be happy to try a graduated work trial if a suitable job opportunity could be sourced.
Based on this evidence, I find that Ms Calvo King has made efforts to mitigate her loss by attending job seeking sessions throughout January 2025 and looking online for suitable jobs for 30 minutes each day on the advice of her psychologist.
Amount of remuneration earned by Ms Calvo King from employment or other work during the period between the dismissal and the making of the order for compensation
The evidence produced by Ms Calvo King establishes that:
Ms Calvo King received the gross amount of $20,798.03 in workers compensation payments for the period from the dismissal to 21 January 2025; and
Ms Calvo King continues to receive weekly workers compensation payments of $712.80.
Therefore, the amount of remuneration earned by Ms Calvo King during the period between the dismissal and the making of the order for compensation is $22,223.63 which is the sum of:
$20,798.03 in workers compensation payments for the period from the dismissal to 21 January 2025; and
$1,425.60 (workers compensation payments for the two week period from 22 January 2025 to 4 February 2025)
Amount of income reasonably likely to be so earned by Ms Calvo King during the period between the making of the order for compensation and the actual compensation
Ms Calvo King provided a Certificate of capacity/certificate of fitness (Certificate) signed by her doctor on 15 January 2025. The Certificate stated that the date of the injury was 1 July 2024 and was caused by being bullied and dismissed at work. The Certificate provided that the next review date was 12 February 2025 and in the ‘comments’ section stated that work could be increased to 3 days per week, preferably on alternate days. In relation to Ms Calvo King’s capacity for work, the Certificate did not state that Ms Calvo King is fit for pre-injury duties. It stated that Ms Calvo King has capacity for some type of work from 15 January 2025 to 12 February 2025 for eight hours per day on four days per week.
As Ms Calvo King is not yet fit to return to her pre-injury duties and has not obtained alternative employment, I find that it is not reasonably likely that Ms Calvo King will receive remuneration in addition to weekly workers compensation payments during the period between the making of the order for compensation and the actual compensation.
I am satisfied that the amount of income reasonably likely to be earned by Ms Calvo King during the two week period between the making of the order for compensation on 4 February 2025 and the payment of compensation on 18 February 2025 is $1,425.60 which is two weeks pay at the weekly workers compensation rate of $712.80.
Other relevant matters
Ms Calvo King submitted that I should take into account the following matters:
· Ms Calvo King has missed out on superannuation and accrued annual leave during the time following the dismissal and while she has been receiving workers compensation.
· There have been a few times during the year when the workshop manager Mr Stock would go on leave and she would be in the workshop working full time five days per week for up to 4 weeks, so Ms Calvo King would get a pay increase during that time.
In relation to superannuation, I have taken this into account when determining the amount that Ms Calvo King would have received, or would have been likely to receive, if Ms Calvo King had not been dismissed. In relation to annual leave, I accept that Ms Calvo King would have continued to accrue annual leave if she had not been dismissed. However, I note that this is not a matter which is generally taken into account by the Commission in awarding compensation in unfair dismissal cases although the Commission appears to have the power to consider this matter under s.392(2)(c).
Having regard to the circumstances of this case, including Ms Calvo King’s length of service and the period that she is likely to be unemployed for, I have not adjusted the compensation that I propose to order in this case to take into account annual leave.
In relation to Ms Calvo King’s remuneration increasing when Mr Stock was on leave, Ms Calvo King has not provided any information which supports this claim, including additional amounts she was paid so there is no evidentiary basis for me to adjust the compensation to take this matter into account.
How is the amount of compensation to be calculated?
As noted by the Full Bench:
[t]he well-established approach to the assessment of compensation under s.392 of the FW 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 (Sprigg).[8] This approach was articulated in the context of the FW Act in Bowden v Ottrey Homes Cobram and District Retirement Villages[9].[10]
The approach in Sprigg is as follows:
Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).
Step 2: Deduct monies earned since termination. Workers’ compensation payments are deducted but not social security payments. The failure of an applicant to mitigate his or her loss may lead to a reduction in the amount of compensation ordered.
Step 3: Discount the remaining amount for contingencies.
Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.
Step 1
I have estimated the remuneration Ms Calvo King would have received, or would have been likely to have received, if Eastern Suburbs Automative had not terminated the employment to be $117,338 on the basis of my finding that Ms Calvo King would likely have remained in employment until 1 July 2026. This estimate of how long Ms Calvo King would have remained in employment is the ‘anticipated period of employment’.[11]
Step 2
I have found that the amount of remuneration earned by Ms Calvo King from the date of dismissal was $22,223.63, and that the amount of income reasonably likely to be earned by Ms Calvo King between the making of the order for compensation and the payment of compensation is $1,425.60. The sum of these amounts is $23,649.23.
Only monies earned since termination for the anticipated period of employment are to be deducted.[12] I therefore deduct the sum of $23,649.23 from $117,338 which leaves an amount of $93,688.77.
The evidence provided by Ms Calvo King establishes that she is not yet fit for pre-injury duties, but that she is fit for some work and that she is being supported by a rehabilitation provider to apply for suitable employment while continuing to receive workers compensation payments. I believe that it will take a longer than usual period for Ms Calvo King to be offered work by a new employer because of her status as an injured worker and because she has not worked for a period of more than six months. Taking account these matters and the evidence before me, I find that it is reasonable for the Commission to assume that Ms Calvo King is likely to obtain employment and cease workers compensation payments within 12 weeks of the date of this decision. This would result in Ms Calvo King continuing to receive weekly workers compensation payments of $712.80 for the 10 week period from 18 February 2025 to 29 April 2025 and these payments ceasing after this period.
There are 71 weeks remaining of the anticipated employment period from 18 February 2025 to 1 July 2026. I believe that Ms Calvo King is likely to earn a total gross amount of $76,059.61 during this time comprising of the following:
· weekly workers compensation payments of $712.80 for the 10 week period from 18 February 2025 to 29 April 2025, which is a total amount of $7,128;
· Ms Calvo King’s pre-dismissal income of $1,009.62 plus superannuation per week in the 61 week period from 30 April 2025 to 1 July 2026, the conclusion of the anticipated employment period, which is a total amount of $68,931.61 calculated as follows:
[($1,009.62 + $116.11[13]) x 9] + [($1,009.62 + $121.15[14]) x 52]
I have deducted the amount of $76,059.61 from $93,688.77 which leaves an amount of $17,629.16. This amount comprises $4,992.73 in superannuation for the period from 1 July 2024 to 29 April 2025 and $12,636.43 on account of wages.
Step 3
I now need to consider the impact of contingencies on the amounts likely to be earned by Ms Calvo King for the remainder of the anticipated period of employment.[15]
There is no evidence before me which establishes the occurrence of contingencies which might have brought about some change in earning capacity or earnings by Ms Calvo King during the anticipated period of employment. The effect of my decision is that I have found that Ms Calvo King is unlikely to experience ongoing future economic loss with respect to the period beyond 29 April 2025. The Commission has evidence before it of the amounts earned by Ms Calvo King during the period from 1 July 2024 to 21 January 2025, so it has been necessary to make assumptions about future economic loss in respect of a limited period of just over three months. I therefore do not consider there to be any evidentiary basis or that it is otherwise appropriate to deduct any amount for contingencies.
Step 4
I have considered the impact of taxation but have elected to settle a gross amount of $17,629.16 and leave taxation for determination.
Having applied the formula in Sprigg, I am nevertheless required to ensure that ‘the level of compensation is an amount that is considered appropriate having regard to all the circumstances of the case,’[16] including my findings that:
It is likely that Ms Calvo King would have remained employed by Eastern Suburbs Automative until 1 July 2026 if she had not been dismissed;
Ms Calvo King continues to be unemployed following the dismissal but is in receipt of workers compensation payments;
Ms Calvo King is likely to continue to receive weekly workers compensation payments of $712.80 for the 10 week period from 18 February 2025 to 29 April 2025;
It will take a longer than usual period for Ms Calvo King to be offered work by a new employer because of her status as an injured worker and because she has not worked for a period of more than six months; and
After 29 April 2025, Ms Calvo King’s earnings are likely to return to their pre-dismissal level.
I am satisfied that the amount of compensation that I have determined above takes into account all the circumstances of the case as required by s.392(2) of the FW Act and that it does not include a component compensating for shock, distress and humiliation.
Is the amount of compensation to be reduced on account of misconduct?
If I am satisfied that misconduct of Ms Calvo King contributed to the employer’s decision to dismiss, I am obliged by section 392(3) of the FW Act to reduce the amount I would otherwise order by an appropriate amount on account of the misconduct.
I am satisfied that misconduct of Ms Calvo King did not contribute to the employer’s decision to dismiss. Therefore, the amount of the order for compensation is not to be reduced on account of misconduct.
How does the compensation cap apply?
Section 392(5) of the FW Act provides that the amount of compensation ordered by the Commission must not exceed the lesser of:
(a)the amount worked out under s.392(6); and
(b)half the amount of the high income threshold immediately before the dismissal.
The amount worked out under s.392(6) is the total of the following amounts:
(a)the total amount of the remuneration:
(i)received by Ms Calvo King; or
(ii)to which Ms Calvo King was entitled;
(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and
(iii)if Ms Calvo King 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 Ms Calvo King for the period of leave in accordance with the regulations.
Ms Calvo King was not on leave without pay or without full pay during the 26 weeks immediately before the dismissal.
Based on the payslips provided by Ms Calvo King, I find that the total amount of the remuneration received by Ms Calvo King during the 26 weeks immediately before the dismissal was $26,250.12 which I have calculated by multiplying Ms Calvo King’s gross weekly pay of $1009.62 by 26. This is less than half the high income threshold which applied immediately before the dismissal.[17] The amount of compensation ordered by the Commission must therefore not exceed $26,250.12 plus superannuation.
I have determined that Eastern Suburbs Automative should pay compensation to Ms Calvo King in lieu of reinstatement within 14 days of the date of this decision in the gross sum of $17,629.16 comprising of:
$4,992.73 in superannuation for the period from 1 July 2024 to 29 April 2025 and
$12,636.43 on account of wages less taxation as required by law
An order giving effect to this determination has been separately issued in PR783977.
DEPUTY PRESIDENT
Final written submissions:
Applicant: 22 January 2025
Respondent: No submissions filed
[1] [2025] FWC 145
[2] He v Lewin [2004] FCAFC 161, [58].
[3] [2025] FWC 145, [53]
[4] 11.5% superannuation from 1 July 2024
[5] 12% superannuation from 1 July 2025
[6] Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34] citing Lockwood Security Products Pty Ltd v Sulocki and Ors PR908053 (AIRCFB, Giudice J, Lacy SDP, Blair C, 23 August 2001), [45].
[7] Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34] citing Payzu Ltd v Saunders [1919] 2 KB 581.
[8] (1998) 88 IR 21.
[9] [2013] FWCFB 431.
[10] Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries[2016] FWCFB 7206, [16].
[11] Ellawala v Australian Postal Corporation Print S5109 (AIRCFB, Ross VP, Williams SDP, Gay C, 17 April 2000), [34].
[12] Ibid.
[13] 11.5% superannuation from 1 July 2024
[14] 12% superannuation from 1 July 2025
[15] Enhance Systems Pty Ltd v Cox PR910779 (AIRCFB, Williams SDP, Acton SDP, Gay C, 31 October 2001), [39].
[16] Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries[2016] FWCFB 7206, [17].
[17] The high income threshold which applied immediately before the dismissal was $175,000.
Printed by authority of the Commonwealth Government Printer
<PR783976>
0
3
0