Reece Costello v Duke Street Holdings Pty Ltd T/A Darwin Honda

[2016] FWC 1790

[2016] FWC 1790

FAIR WORK COMMISSION

DECISION

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

Reece Costello
v
Duke Street Holdings Pty Ltd T/A Darwin Honda
(U2015/16459)

COMMISSIONER WILSON MELBOURNE, 22 MARCH 2016

Application for relief from unfair dismissal - extension of time.

[1] This matter concerns an application made by Reece Costello alleging unfair dismissal against his former employer, Duke Street Holdings Pty Ltd, trading as Darwin Honda. Mr Costello’s application to the Fair Work Commission was first received in the Commission by email on 3 December 2015.

[2] Mr Costello’s unfair dismissal application refers to it being an action against “Kerry’s Automotive Group”, however the name of the Respondent has since been amended by me to Duke Street Holdings Pty Ltd, trading as Darwin Honda, pursuant to s.586(a) of the Fair Work Act 2009 (the Act), with the consent of the parties in the course of the hearing of the extension of time question associated with this matter.

[3] Darwin Honda’s initial objection to Mr Costello’s unfair dismissal application included not only an argument that the matter was out of time, which is dealt with in this decision, but that also Mr Costello had not served the minimum employment period specified within s.383 of the Act, with the attendant implication that Mr Costello is not a person protected from unfair dismissal. This argument was advanced on the basis that Darwin Honda was a small business employer within the meaning of s.23 of the Act. If this was accepted, Mr Costello would not be a person protected from unfair dismissal for the reason that he was employed in March 2015 and dismissed in November 2015.

[4] Material provided by the Respondent in the course of the preparation for this matter indicated not only that Darwin Honda employed 13 people at the time Mr Costello was dismissed, but also that it is connected with a larger company, KAP Motors Pty Ltd trading as Kerry’s Automotive Group. Following discussion of the matter by me with the Respondent’s representative, Mr Craig Ambrose-Pearce, the Dealer Principal, he conceded that the two companies were associated entities for the purposes of s.23(3) of the Act, which requires that the employees of associated entities be included when considering whether an entity is a small business employer. Because of that concession it is not necessary for me to determine the matter of whether the Respondent is a small business employer.

[5] Section 394(2) of the Act requires an unfair dismissal application to be made within 21 days after the dismissal took effect or within such further period as the Commission allows under s.394(3). Both parties submit that the termination of employment took place on 9 November 2015. It is apparent from the dates referred to above that the application is therefore 3 days out of time.

[6] In this decision, I have considered whether an extension of time should be granted to Mr Costello for the making of his application, and for the reasons set out below, I am not satisfied that a further period should be allowed for the making of his application.

[7] In considering an application for an extension of time for the making of an unfair dismissal application, the Actrequires I must be satisfied that there are exceptional circumstances for the making of the application taking into account the criteria which are specified within s.394 (3) of the Act. The Full Bench has held that the test for granting an extension of time involves both a broad discretion and a high hurdle of exceptional circumstances, and the longer the delay in making the application the more difficult it will generally be to get over that hurdle. 1 A decision as to whether to extend the time period under s.394(3) involves the exercise of a discretion.2

[8] Darwin Honda objects to the application continuing given that it was commenced after the statutory period for the making of an unfair dismissal application and that the circumstances of the matter are such that an extension of time should not be granted.

[9] The evidence before me includes the documents filed by both parties in preparation for the hearing of the matter, and the oral evidence and submissions of Mr Costello, the Applicant, and his mother, Ms Dianne Costello, and the evidence and submissions of Mr Ambrose-Pearce on behalf of Darwin Honda.

Background

[10] Mr Costello worked for Darwin Honda in its service department and was engaged as an apprentice, working toward a Certificate III diploma. He came to be dismissed by Darwin Honda on 9 November 2015 because of concerns the company held about Mr Costello’s behaviour at work. On that day Mr Costello had worked for about the first half of the day, after which he was dismissed.

[11] When he was dismissed, he had been called in to speak with Mr Ambrose-Pearce and was told that a warning was being recorded about his behaviour and that he was also being asked to leave employment on the same day. The reasons given to Mr Costello are set out in a Notice of Termination provided to him, and include the following;

“Inappropriate behaviour in the work place. Not clocking onto repair orders, Foul and abuse language toward staff and business associates. Not taking due care in workshop. Leaving work property out. Absent from work without consent” 3

[12] This advice is broadly consistent with the content of a letter of warning that was ultimately included on Mr Costello’s employment file and which has been provided in evidence in these proceedings. That letter is dated 9 November 2015 and states;

“This Warning Notification is to document that as a result of direct counselling on 5th October 2015, and the disciplinary interview held on 23rd October 2015, you are hereby officially warned in relation to the following matters:

• Inappropriate behaviour in the workplace. Swearing and foul language in the work shop and in meetings. Being on the 29th October 2015. In a meeting held with Tamera-lee Stacy from the Australian Apprenticeships NT. You swore 14 times. Four of them after being told it was inappropriate. With you response being " they are only words ".

• Not clocking onto repair orders.

• Leaving work property out of place and on the ground. Being on the 29th October leaving work hoses and shamy on the ground again after being told not to as dirt shamy scratched vehicles” 4

[13] While this letter is couched as a “written warning” it is likely better characterised as a record of the concerns Darwin Honda held about Mr Costello’s conduct and which led directly to his dismissal on that day. The 9 November 2015 correspondence indicates at the bottom that “Reece refused to sign”.

[14] Two earlier warnings had been given to Mr Costello for similar matters on 6 and 23 October 2015. Whereas the 6 October 2015 warning is signed and acknowledged by Mr Costello, a notation on the document given to him dated 23 October 2015 is made by Mr Ambrose-Pearce that “Reece refused to sign”.

[15] Mr Costello puts forward several matters disputing the need for the warnings, including that he had been injured at work under circumstances in which he had been endeavouring to do his best for the employer; that his work injury had required surgery which appears not to have entirely resolve the matter; and that equipment he owned had been stolen from the workplace, a circumstance about which the employer supervisors did not appear to care.

[16] Having been dismissed on 9 November 2015, the last day an unfair dismissal application could be lodged for it to be within time would have been Monday, 30 November 2015, while it was actually lodged on 3 December 2015.

Legislation

[17] For the purposes of s.396 of the Act, Mr Costello is otherwise a person protected from unfair dismissal and the Small Business Fair Dismissal Code has no application to his circumstances.

[18] In considering whether an extension of time should be granted to Mr Costello, I am required to consider all of the criteria in s.394, which I now do.

Consideration of the factors set out in section 394(3) of the Act

1. The reason for the delay

[19] The prima facie position is that the time limit prescribed by the Act should be complied with unless there is an acceptable explanation of the delay which makes it equitable to so extend. 5 An applicant needs to provide a credible reason for the whole of the period that the application was delayed.6 The delay required to be considered is the period beyond the prescribed 21 day period for lodging an application. It does not include the period from the date of the dismissal to the end of the 21 day period.7

[20] Having been dismissed on 9 November 2015, Mr Costello was required to undertake the surgery referred to above, which arose from an injury to his knee. That took place on 11 November and he was restricted in his movements for about 14 days after that period. In addition he had been living in an area with poor internet connectivity, which hampered his ability to make an unfair dismissal application.

[21] It is this last reason which becomes the explanation for Mr Costello’s application for unfair dismissal being out of time. While he points to living in a place with poor internet access, Mr Costello does not put forward dates when he began talking with either his parents or others about making an unfair dismissal application. I therefore have little context as to when he first considered make an application or the efforts that he took to ascertain his rights.

[22] The effect of the circumstances advanced by Mr Costello is not exceptional.

[23] The most significant matter to which he points is the period of recovery after being hospitalised for his workplace injury, however that period is within the time limit allowed for the making of an unfair dismissal application. Having had surgery on 11 November 2015, and then being restricted for about 14 days, at the conclusion of that period there was still slightly less than a week to run before he could make an application within time. He could have exercised his rights during that period but did not do so.

[24] No clear evidence is put forward about what then occurred between 30 November 2015, being the last day on which an application could be made within time and when his application actually was made, on 3 December 2015. Other than the explanation Mr Costello puts forward about poor internet connectivity, he has not advanced any particular reason that impaired him from making an application within time.

[25] In the circumstances I find that the reason for the delay is Mr Costello’s inattention to the need to challenge his dismissal within the allowed time period, had that been what he wished to do.

[26] As a result of the circumstances I consider an acceptable reason has not been put forward for the delay in Mr Costello making an unfair dismissal application. Accordingly, this criterion does not resolve in his favour in my consideration of whether an extension of time for filing should be granted.

2. Whether the person first became aware of the dismissal after it had taken effect

[27] As set out above, I am satisfied that Mr Costello first became aware of the termination of his employment when he was dismissed on 9 November 2015. This is therefore not a circumstance where Mr Costello only became aware of his termination at some point after the time that it occurred. Accordingly, this is a neutral factor in my consideration.

3. Any action taken by the person to dispute the dismissal

[28] Mr Costello’s evidence about the actions taken by him to dispute his termination of employment is that it consists entirely of making the application for unfair dismissal to the Commission.

[29] In the circumstances of this matter, I take the view that consideration of this criterion resolves in favour of the Respondent.

4. Prejudice to the employer (including prejudice caused by the delay)

[30] The delay in the filing of the application is 3 days. The Respondent does not claim that the delay in lodging the application caused it prejudice, other than the additional time and expense objecting to the extension of time.

[31] While there has been prejudice and disruption to the employer already with these proceedings, there is likely to be further prejudice if I were to grant the extension of time. Balanced against this is the probability that a full merits proceeding is not likely to bring forward much additional material to that already before the Commission. It is acknowledged that the process of having to respond to an unfair dismissal application itself creates some prejudice to the former employer. However the consideration of the Commission in relation to this criterion is a consideration as to prejudice beyond this usual requirement of having to respond to the claim. The presumption is that in the event an employer claims that there will be prejudice arising from the extension of time, the employer must produce evidence to demonstrate prejudice. In the event that such evidence is brought forward, the employee would then need to demonstrate that the facts as shown by the former employer do not amount to prejudice. 8

[32] In relation to this matter, there is no evidence before the Commission that there would be undue prejudice to the former employer if an extension of time is to be granted.

5. The merits of the application

[33] The merits of the application to which I must have regard are whether or not the limited evidence I have seen to date discloses a likely unfair dismissal.

[34] In relation to the Commission’s consideration of the merits of an application when undertaking an analysis of whether an extension of time for the filing of an unfair dismissal application should be granted, the Commission does not require detailed evidence and usually does not make findings of fact as to the evidence which is brought forward on the merits of the application. Instead the Commission’s consideration of this question is to ascertain whether there is an arguable case on behalf of the Applicant; or alternatively whether it appears that such case either has very strong or very weak merits on its face. It has been said in previous matters that a highly meritorious claim may persuade a decision-maker to accept an explanation for delay that would otherwise have been insufficient. 9

[35] The merits of Mr Costello’s case as put to me are essentially that, notwithstanding the warnings which were given to him about his conduct on two previous occasions, his conduct is explained by his dissatisfaction with safety in the workplace, which appears consequential to an injury he sustained; as well as his dissatisfaction with the employer’s response to his claims that equipment of his had been stolen from the workplace, without company supervisors doing anything about it.

[36] In the overall context of this matter, which includes a short-serving employee under an apprenticeship and subjected to the warnings that had been issued, it appears unlikely that Mr Costello’s case would succeed if a full hearing was allowed. He appears to have responded to the warnings, whether or not legitimately grounded, with hostility rather than corrective action.

[37] As a result I consider that Mr Costello’s case, if it proceeded, would be somewhat weak. This criterion accordingly does not resolve in his favour.

6. Fairness as between the person and other persons in a similar position

[38] In considering whether I should grant an extension of time, I need to have regard to whether it is fair to other unfair dismissal applicants whose applications are either currently before the Commission, or have been decided in the past. 10

[39] In applying the facts of Mr Costello’s matter to this criterion, it is my view that fairness to other unfair dismissal applicants in similar circumstances to him would give rise to an expectation that there had been some process of diligent inquiry or dispute by him not long after the dismissal. However, this was not the situation. Accordingly consideration of this criterion also resolves against the Applicant.

[40] Taking into account all relevant factors, and principally for the reason that I do not consider there to be an acceptable explanation for the delay in making his unfair dismissal application, I am not satisfied there are exceptional circumstances that would warrant allowing a further period to Mr Costello for the making of an application for unfair dismissal remedy. In forming this view I have given consideration not only to the particular circumstances of his case but also to the criteria set out within s.394(3) of the Act.

[41] For these reasons, I decline to grant an extension of time pursuant to s.394 of the Fair Work Act and will issue an order dismissing Mr Costello’s application as being out of time.

COMMISSIONER

Appearances:

Mr R Costello and Ms D Costello for the Applicant

Mr C Ambrose-Pearce on behalf of Darwin Honda

Hearing details:

2016.

Melbourne (by telephone):

10 March.

 1   Lombardo v Commonwealth of Australia as represented by the Department of Education, Employment and Workplace Relations[2014] FWCFB 2288 [21].

 2   Shaw v Australia and New Zealand Banking Group Limited T/A ANZ Bank[2015] FWCFB 287 [9].

 3   Exhibit A1, Applicant Document List, Document 2.

 4   Exhibit R1, Respondent’s Document List, Document 7.

 5   Brodie-Hanns v MTV Publishing Ltd (1995) 67 IR 298, 299-300.

 6   Cheval Properties Pty Ltd (t/as Penrith Hotel Motel) v Smithers (2010) 197 IR 403, 408‒409.

 7   Shaw v Australia and New Zealand Banking Group Limited T/A ANZ Bank[2015] FWCFB 287.

 8   Cowie v State Electricity Commission of Victoria [1964] VR 788; cited in Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541, 547. See Jervis v Coffey Engineering Group Pty Limited (unreported, 2003) PR927201 [16].

 9   Haining v Deputy President Drake (1998) 87 FCR 248, 250 .

 10   Wilson v Woolworths [2010] FWA 2480 [24]‒[29].

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