Regan Bell v Jenni International Pty Ltd
[2020] FWC 2747
•29 MAY 2020
| [2020] FWC 2747 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Regan Bell
v
Jenni International Pty Ltd
(U2019/11639)
COMMISSIONER LEE | MELBOURNE, 29 MAY 2020 |
Application for relief from unfair dismissal – whether applicants’ termination was a genuine redundancy-Satisfied that termination was not a genuine redundancy - Small Business Fair Dismissal Code applies – satisfied that dismissal not consistent with Small Business Fair Dismissal Code. Matters in s.387 considered. Satisfied that the dismissal was unjust and unreasonable. Compensation ordered as remedy.
Background
[1] This matter involves an application made pursuant to section 394 of the Fair Work Act 2009 (the Act) for unfair dismissal remedy. Ms Regan Bell (the Applicant) claims that she was unfairly dismissed from her employment with Jenni International Pty. Ltd. (the Respondent).
[2] The application was lodged on 17 October 2019. The matter was allocated to me on 21 January 2020. This matter was adjourned on numerous occasions at the request of the Respondent, Ms. Pui San Lei (Ms Lei) 1. The history of the various adjournments is set out in an email sent by my chambers to Ms. Lei on 19 March 2020.
“Dear Ms Lee,
I write in relation to the above matter and also refer to your correspondence of today’s date.
This matter was originally listed for 30 January 2020. That hearing was cancelled after a request by you for an adjournment for the following reasons:
Your lawyers have terminated their representation.
You are residing overseas and are a single mother.
You lack English and legal skills.
You have to care for your 6 year old daughter who is recovering from surgery.
You have used your savings to pay for her medical bills.
There is a medical check-up of your daughter on “the day” presumably the day of the hearing.
You will need legal funds and support to defend your case and more time to prepare withnew legal support.
The hearing for 30 January 2020 was cancelled based on the provision of some evidence including a medical certificate pertaining to your daughter’s medical treatment in Panang, Malaysia and travel itinerary. Accordingly, the Commissioner determined that as a result of your 6 year old daughter’s medical appointment being scheduled for the day of the Hearing and your associated claim that you are required to care for her during recovery from surgery that it was appropriate to adjourn the hearing scheduled for 30 January 2020.
This matter was re-listed for attendance hearing on 13 March 2020. At 11.41PM on 12 March 2020, you advised that you were unable to attend the hearing as you were “sick for three days with a high temperature.” You also stated that you were told “that I need to have a bed rest and watch for a possible coronavirus infection to due to an infected person in my neighbourhood.”
As a result of the extremely late notice of your claimed inability to attend the hearing, out of fairness to you, the hearing was cancelled despite you supplying no medical evidence to support your claim that you were unable to attend the Commission. The matter was relisted for hearing on 21 March 2020.
You were directed to provide medical evidence supporting the claim of your illness, including evidence of the dates of attendance with any medical professionals in the 3 days prior to the hearing. You were required to do so by close of business 13 March 2020. Until today, no correspondence was received from you.
The correspondence sent today states that you are unable to attend the hearing by telephone listed for 21 March 2020 due to “unfit health with continued high temperatures and extreme anxiety and depression.” You also refer to a family member “…now having the virus and I’m now requested for non overseas travel and quarantined for a further 14 days.”
You have provided a copy of a receipt from payment from a hospital in Kuala Lumpur Malaysia dated 11 March 2020. The receipt attached provides no evidence to support your claim that you are unable to participate in a telephone hearing on March 21st. The Commissioner advises that this is not sufficient evidence to demonstrate that you are unable to participate in a telephone hearing on 21 March 2020.
You have also referred to a family member being infected with “the virus” However, there is no evidence provided to support this claim.
In the circumstances, the Commissioner intends for the hearing to proceed as scheduled.
The Commissioner notes that you have been put on notice about the requirements of suitable evidence to support your request for an adjournment on various occasions.
The Respondent should also be aware that if the Respondent fails to attend the hearing, the Commission will still proceed to hear the matter in the absence of the respondent and may make a determination in their absence.
Please do not hesitate to contact me should you have any queries in relation to this.” 2
[3] For her part, the Applicant complained of the numerous adjournments sought and granted to the Respondent. In particular the Applicant advised my Chambers that as she was now engaged as a “temp” that on each occasion the matter was listed she had to make herself unavailable for the work and consequently was not paid. She was also concerned that her absences might lead to her employer no longer offering her placements. In order to accommodate those concerns the matter was listed for hearing on a Saturday.
[4] Prior to the 30 January 2020, the matter was listed for Non-Compliance Hearing before me on 23 January 2020. Attempts to contact the Respondent on the phone number supplied were unsuccessful and the hearing continued with the Applicant. The Respondent emailed my Chambers requesting an adjournment for the hearing, which was not granted.
[5] On 19 March 2020 the Respondent emailed my Chambers indicating that she was experiencing a high temperature, extreme anxiety and depression and would be unable to attend the 21 March 2020 hearing by telephone. The matter was subsequently listed for 28 March 2020 for which the Respondent provided a medical certificate dated 21 March 2020 stating that she was awaiting the results of a COVID-19 test, having a high temperature, chest pain, anxiety and depression and was instructed not to work and confined to bed rest.
[6] Ultimately the matter was adjourned yet again and listed for hearing on Saturday 4 April 2020.
[7] The afternoon prior to the hearing on 4 April 2020 the Applicant corresponded with my Chambers stating as follows:
“Hi !
I write and advise that I am too ill to attend any work particularly stressful work such as yours.
My temperature has come down but my chest pain and depression continue as my family is also suffering from the ordeal in this pandemic crisis.
My doctor said, he did not specifically give a time limit for my sick leave because he strongly suggested that I use the opportunity to look after my family and recover my sickness.
I will find an opportunity to get a new medical cert for you.
I think we all need a break from both mental and medical stress. What you have been doing and pushing me to do have placed an enormous mental hardship deteriorating my health among the already enough hardships I and my family are suffering- it drives me insane. The arrogant tones of yours at the last session has been a nightmare constantly going through my mind and I have serious insomnia every night!
I feel so venerable being a young Asian woman without any legal help lacking English skills facing an arrogant, unethical and strong personality , who knows how to play the system, yet a severely misconducted and matured manager in an environment that she knows well, and so this send me into a hell.
I ask you to show your humanitarian face particularly when your courts and tribunals suspend or adjourn their matters to June or July even their matters are more urgent and or important than your non essential one. I ask for your mercy to allow me have some rest giving me peaceful opportunity to overcome my conditions and to look after my family.
I then could hopefully attend it sometime in late May ie., some 5 weeks later.
As a final note and touch down on the matter, we found a note and a spreadsheet that the salesmen have chasing for the sales commissions that Regan has failed to pay, some $35,000 in total. Attached.
So again, this is a new evidence how she has ruined the office financial position. While people might be concerned with what Regan has lost, it is important to stress again, that we must pay more important attention to those who are sacked by Regan and what those 8 staff members had lost. It is equally important for people to respect and to worry about what the 5 shareholders have lost (the huge loss that the Company had suffered, detailed in my earlier submissions), and she has been proofed to be solely accountable for. Apparently she is using her unfair dismissal case to support her plan to win her the so-called “entitlements” claim, a claim that she has not gone anywhere so far.
I won’t be able to monitor my emails as My family will start a religion fasting for several weeks, and will attend your matter once I am recovered and when the religion fasting is over.
Thank you!
San” 3
[8] The Respondent had been warned that suitable evidence including medical evidence must be provided to support any claim for adjournments and that failure to do so will mean that the matter would proceed and a determination made in her absence. No such evidence was provided. In any case, the concluding paragraphs of the correspondence from the Respondent states that she will not be monitoring her emails and that she would attend to the matter when the religious fasting is over, though there was no indication of when that might be.
[9] The claims of Ms Lei that her doctor did not specify a time limit for her incapacity from sickness is simply not credible. Nor is there any indication as to why her participation in fasting as part of her religious beliefs precludes her from monitoring emails. The final sentence of the Respondent’s email indicates that the Respondent will attend to the matter at a time of her choosing.
[10] As stated earlier, to accommodate the working arrangements of the Applicant, the matter was listed for a Saturday hearing. In the circumstances pertaining to COVID-19, the matter was listed by phone.
[11] Against the background set out above of numerous adjournments and the failure of the Respondent to provide medical evidence I determined to conduct the hearing in the absence of the Respondent. I note on the day of the hearing, my Chambers made numerous attempts to contact the Respondent by phone however the Respondent did not answer the call. After 15 minutes of trying to contact the Respondent, the hearing proceeded. I have taken into account the materials filed by the Respondent in the matter in reaching a decision in this matter.
Law to be applied
[12] Section 394 of the Act provides that a person who has been dismissed may apply to the Commission for an order under the Act granting a remedy. The Act provides that an application must be made within 21 days after the dismissal took effect, or within such further period as the Commission allows.
[13] It is apparent from the evidence 4 that the Applicant was notified of her impending termination on 30 September 2019. The Applicant was advised in the letter of termination that she was to be given four weeks notice but be required to work some of that period. In fact, the Applicant only worked for one week of that notice period. The Applicant’s last day of employment with the Respondent was 4 October 2019.5
[14] A person is protected from unfair dismissal if:
“Division 2—Protection from unfair dismissal
382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and
(b) one or more of the following apply:
(i) a modern award covers the person;
(ii) an enterprise agreement applies to the person in relation to the employment;
(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.
Note: High income threshold indexed to $148,700.00,000 from 1 July 2019
383 Meaning of minimum employment period
The minimum employment period is:
(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:
(i) the time when the person is given notice of the dismissal;
(ii) immediately before the dismissal; or
(b) if the employer is a small business employer—one year ending at that time”.
[15] With regard to s.382(a) of the Act, it is common ground that the Applicant commenced employment with the Respondent on 3 October 2017. 6 It is apparent that the Applicant has completed a period of employment of at least the minimum employment period.
[16] With regard to s.382(b) of the Act, the Applicant asserts that she is covered by the Real Estate Award 2010. The Respondent in their Form F3 stated that no Modern Award or Enterprise Agreement applied to the Applicant. No material was filed in support of the Respondent’s contention. The Applicant gave evidence during the Hearing that during her employment was the Officer in Effective Control. and submitted that position aligns to a Real Estate Employee Level 4 classification under the Award. 7 Clause 4 of the Real Estate Award 2010 (the Award) covers employers in Australia in the real estate industry; meaning provisions of services associated with sales, acquisitions, leasing and/or management of residential, commercial, retail, industrial, recreational, hotel, retirement and any other leasehold or real property and/or businesses, who are engaged in the classifications at clause 14 of the Award. The Real Estate Employee Level 4 classification is the “In-Charge Level” of the Award and appears to corelate with the Applicant’s position with the Employer.8
[17] I am satisfied that the Applicant is covered by the Real Estate Award 2010.
[18] In the event I am wrong about that, I am satisfied that the sum of the Applicants annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold. The Applicants annual salary at the time of dismissal was $109,590.00.
[19] Section 385 of the Act sets out what constitutes an unfair dismissal;
“Division 3—What is an unfair dismissal
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.
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.
[20] With regard to s.385(a), s.386 of the Act sets out the meaning of dismissed. It is apparent on the evidence that the Applicant was terminated on the Employer’s initiative. 9
[21] With regard to ss.385(c) of the Act, the Respondent asserts that it is a small business in accordance with s.23 of the Act, asserting that at the time of dismissal the business employed three persons. 10 The Applicant does not dispute that the Respondent was a small business at the relevant time although believes that there were six employees at the relevant time.11 In either case, there is less than 15 employees. Therefore whether the dismissal was consistent with the application of the Small Business Fair Dismissal Code is relevant to this matter. I note that the Respondent in their Form F3 did not assert that the dismissal was consistent with the Small Business Fair Dismissal Code. However, on 28 February 2020, one week after the Respondent was required to file their materials in accordance with the directions, the Respondent filed a completed Small Business Fair Dismissal Code Checklist. The checklist was completed on the 28 February 2020. There is no other information relevant to the checklist other than the accompanying email which states: “Attached herein also included the “Dismissal Check List” published on your website, which I believe will be a good wrap up of our counter fight positions.”12 It is apparent that whether or not the dismissal was consistent with the Small Business Fair Dismissal Code is a matter to be determined.
[22] With regard to s.385(d) of the Act, there was no suggestion in the Respondent’s Form F3 that the Applicant’s dismissal was a case of genuine redundancy. In fact the Form F3, which was completed by the Respondent’s legal representative that time, explicitly stated that “It is not alleged that the termination was a redundancy within the meaning of section 389 of the Act.” 13 However, the Respondent has then subsequently made submissions that the dismissal was in fact a case of genuine redundancy. Whether or not the dismissal is a case of genuine redundancy is a factual dispute that also requires determination.
[23] If it is found that the dismissal is not a case of genuine redundancy and if it is found that the Small Business Fair Dismissal Code has not been complied with, I must consider whether the dismissal was harsh, unjust or unreasonable. Section 387 of the Act states:
“387 Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:
(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); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(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; and
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and
(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; and
(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”.
Summary of matters to be determined
[24] As outlined above, the Respondent asserts that the termination was a genuine redundancy.
[25] It is apparent that the Respondent is a small business consistent with the definition in s.23 of the Act as at the time of dismissal the business employed less than 15 employees.
[26] This raises two jurisdictional matters, Firstly, whether the dismissal was a case of genuine redundancy and secondly, if it was not, whether the dismissal was consistent with the Small Business Fair Dismissal Code. The Respondent appears to submit that the dismissal was both a genuine redundancy and was consistent with the Small Business Fair Dismissal Code.
[27] If the Applicant overcomes both jurisdictional objections then consideration turns to whether the dismissal was harsh, unjust and unreasonable taking into account the factors in s. 387 of the Act.
Was the termination of employment a genuine redundancy?
[28] The Applicant provided sworn evidence at the hearing on 4 April 2020. The Applicant also provided an outline of the arguments that she sought to advance as well as a witness statement. In her outline 14 in answer to the question, “What reason were you given for the dismissal?” she gave the following answer:
“Redundancy due to the restructuring of the business. Amanda Ferrell purchased shares into Jenni International Pty Ltd y/as Stockdale & Leggo Werribee and would be taking over my role” 15
[29] The Applicant also gave evidence that:
“The employer did not follow the small business fair dismissal code as per below:
• a) I had no prior knowledge, consultation or information regarding the pending changes to the structure of the business that would directly affect my working arrangements
• b) I did not get an invitation to a termination meeting prior to the “catch up” on the 30th September 2019.
• c) I was not given the opportunity to have a support person present
• d) I was not given the opportunity to ask questions
• e) No consideration to options or alternatives to the redundancy such as redeployment. 3 new staff were hired and to commence from the 1st October 2019
• f) The termination letter did not include the following
i) the date of my last day at work
ii) the period of notice I would be required to work or be paid in lieu. This was added as a footnote to the letter during the meeting
iii) details of my entitlements owed to me, including but not limited to annual leave; wages owed up to the 1/10/19 or if any redundancy pay was offered (although not required)
NB: Whilst I note the employer did not have a in house HR person other than myself. Employsure is contracted to the company for 3 years commencing 2018 for all HR and employment advice, including and not limited to, procedure guidelines and documentation requirements. Client number EMP27115. Also I note that previously the director wanted to make Angela Feterika redundant and I made him aware there was a procedure that had to be followed as per legislation” 16
[30] In her witness statement the Applicant says:
“Pui San Lei (known as San) informally asked me if we could “catch up “around 12.15pm on the 30th September 2019. I was not aware at this time San was now the director of Jenni International Pty Ltd.
At the “catch up” San, a person by the name of Douglas (surname and position unknown) and I were present. I was handed my letter of termination due to redundancy.
The employer did not follow the small business fair dismissal code as per below:
• I had no prior knowledge, consultation or information regarding the pending changes within the structure of the business that would directly affect my working arrangements
• I was not given the opportunity to have a support person present
• I was not given the opportunity to ask questions
• No consideration to all options or alternatives to the redundancy such as redeployment. 3 new staff members were hired and commenced from the 1st October 2019
During the “catch up” San and Douglas spoke to each other in Mandarin or Cantonese and no interpreter was present to translate nor did they translate to me what they were saying
The letter of termination did not include the following:
• The date of my last day of work
• The period of notice I would be paid in lieu; this was added as a footnote by me and signed by San and I
• Details of my entitlements owed to me, including but not limited to annual leave; wages owed up to the 1st October 2019 or if any redundancy pay was offered (although not required)
• The employer is contracted to Employsure EMP27115 for HR and employment advice, including but not limited to, procedure guidelines and documentation required
• Other factors: the employer has not paid my outstanding wages until the 1st October 2019, annual leave, balance of my notice period or supplied pay slips. I have lodged a complaint with the Fair Work Ombudsman reference number 136083
At no time prior to this “catch up” was I advised of the pending changes to the company structure nor how they would affect my employment.
I was in regular contact with Jordan Shan who was Jenni Internationals representative up to and including Friday the 28th September 2019. At no time did Jordan Shan take the opportunity to advise me of the pending changes.
After the “catch up” on the 30th September I was available to San, Alex Chu (the companies accountant) and any other representative of Jenni International Pty Ltd to go through any information they required. At approximately 2pm on the 30th September 2019, Amanda Farrell came into the office and took over the day to day running of the business. Amanda Farrell removed all my access to the computer system and related software. I continued to work at the office until Friday the 4th October 2019. I was available during this time for any information to allow a smooth handover. San did not meet with me from the 2nd October 2019.
At no time prior to, or after the “catch up” was there a meeting of any of the employees informing them of the changes to the company, my position or their ongoing employment arrangements. I was asked who Amanda was and why she was there. I asked Amanda if she wanted to say something and she said no and I could advise them I was made redundant and she would be taking over my role.” 17
[31] The letter of termination of the Applicant is in the following terms:
“The shareholders of Jenni International who controls Stockdale and Leggo, Werribee, had recently held a meeting to review the office performance.
At the meeting, the shareholders accepted Jordan to step down as the director due to his eye and health issues. San is appointed as the new director. They are disappointed at the downturn since July 2018 despite additional and large amount of funds were pulled in the Office.
Therefore, they introduced a new shareholder Amanda Ferrell, who invested in the company and will bring her team on board. Amanda offered to manage it and play a provocative role in the business. They also note, the office cannot support you $150,000 package due to severe financial hardship.
So, this letter is to inform you, regretfully, that your position as the OIE C for Stockdale and Leggo, Werribee is no longer available, and will take effect as the 1st October 2019. We take this opportunity to thank you for your time in the past and trust you will move forward to a new business venture.
Whilst we give you a 4 week notice period, we would hope you can start immediately to work with the new OIE C in the next couple of weeks to ensure a smooth transition. You will be paid by FWO guidelines and you can talk to Douglas and San who are the shareholders currently overseeing the redundancy.
We trust you will exercise your discreteness and follow the code of conduct to satisfy the process, and we will review and audit the office books and other related matters for the period you worked for the company.
Sincerely
Jordan Shan
on behalf of shareholders of Jenni International
NB: Will be paid 4 weeks notice but only required to work until 4/10/19 ensuring handover completed + entitlements + redundancy.” 18
[32] It is apparent that while this letter refers to the termination as a redundancy in the second last paragraph of the letter, it is also apparent from the text of the letter that the Applicant’s position of Officer in Effective Control (OIEC) is “no longer available”. However, there is clearly a new OIEC, Amanda Farrell, that has simply been appointed in the Applicant’s place. The Applicant is required to work with the new OIEC for a couple of weeks in order to allow a smooth transition. The letter of termination makes clear that the job of OIEC remains, the Applicant has simply been replaced by someone else.
[33] Adding to the inconsistency of the Respondent’s position as to whether the termination was a genuine redundancy, the joint statement filed by Ms Lei and Xeado Xiao claims that shareholders instructed them to terminate the employment of the Applicant and that four weeks notice is all that is required. There is no mention whatsoever of redundancy in that statement. 19
[34] However, in the Small Business Fair Dismissal Code Checklist that was filed on 28 February 2020, some two months after the witness statement referred to above was made, the Respondent answers yes to the question “Did you dismiss the employer because you didn’t require the person’s job to be done by anyone because of changes in the operational requirements of the business?” 20 Also questions at 3a and 3b of the checklist, as replicated below, were answered in the affirmative:
“a. Did you comply with any requirements to consult about the redundancy in the modern award, enterprise agreement or other industrial instrument that applied to the employment.
b. Did you consider if the employee could have been redeployed in your business or the business of an associated industry.” 21
[35] However, the following answer is given to question 9:
“Did you dismiss the employee for some other reason?
✔ Yes
No
If Yes, what was the reason?
(1). Financial: cannot afford her high salary package due to her misconduct causing a negative cash flows of the office and the huge indebtedness.
(2). Structural change: her job is no longer required as an “outside manager”, because The shareholders manage the office themselves. One shareholder was appointed as the OIEC with a competitive reward.” 22
[36] During the hearing, I asked the Applicant to comment on the claims in the material of the Respondent that she was redundant and whether she herself held the view that the termination of employment was a genuine redundancy. The Applicant asserted during the hearing that her position was not redundant. 23
[37] In conclusion, it is abundantly clear on the evidence that the Applicant’s dismissal was not a case of genuine redundancy. The letter of termination and the answer to question nine on the Small Business Fair Dismissal Code Checklist. provided make clear that what the Respondent has done is simply terminate the Applicant and replace her with another employee. While that employee is a shareholder, it is apparent from the Respondent’s own evidence that she is being paid remuneration for that work by way of “competitive reward”.
[38] A dismissal is a case of genuine redundancy when:
• the employer no longer requires the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise, and
• the employer has complied with any obligation imposed by an applicable modern award or enterprise agreement to consult about the redundancy. 24
[39] It is clear on the evidence that the job of the OIEC is still being performed. The Applicant was simply dismissed from her position and replaced. The termination is clearly not a case of genuine redundancy. The Respondent’s legal representatives made clear in the Form F3 that it was not a case of genuine redundancy. The Respondent’s post facto attempt to construct an argument that the Applicants dismissal was a case of genuine redundancy is spurious.
Was the dismissal consistent with the Small Business Fair Dismissal Code?
[40] Having determined that the Applicant’s termination was not a genuine redundancy, I must now turn to whether the dismissal was consistent with the Small Business Fair Dismissal Code (s.385(c) of the Act).
[41] The Small Business Fair Dismissal Code is as follows;
“The Code
Summary Dismissal
It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.
Other Dismissal
In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.
The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.
The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.
Procedural Matters
In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.
A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.”
[42] The summary dismissal aspect of the Small Business Fair Dismissal Code was considered by a Full Bench of the Commission in Pinawin T/A RoseVi.Hair.Face.Body v Mr Edwin Domingo 25The Full Bench stated:
“[29] …There are two steps in the process of determining whether this aspect of the Small Business Fair Dismissal Code is satisfied. First, there needs to be a consideration whether, at the time of dismissal, the employer held a belief that the employee’s conduct was sufficiently serious to justify immediate dismissal. Secondly it is necessary to consider whether that belief was based on reasonable grounds. The second element incorporates the concept that the employer has carried out a reasonable investigation into the matter. It is not necessary to determine whether the employer was correct in the belief that it held.
[30] Acting reasonably does not require a single course of action. Different employers may approach the matter differently and form different conclusions, perhaps giving more benefit of any doubt, but still be acting reasonably. The legislation requires a consideration of whether the particular employer, in determining its course of action in relation to the employee at the time of dismissal, carried out a reasonable investigation, and reached a reasonable conclusion in all the circumstances. Those circumstances include the experience and resources of the small business employer concerned.
…
[38] Normally in order to hold a belief on reasonable grounds it will be necessary to have a discussion with the employee about the perceived serious misconduct and pay regard to the explanations and views given by the employee. We are concerned in this case that no discussions took place about the implications of Mr Domingo’s conduct for his future employment…” 26
[43] As noted above, while the Respondent asserts that the Applicant was redundant, they also appear to assert that the dismissal was consistent with the Small Business Dismissal Code.
[44] The Small Business Fair Dismissal Code Checklist supplied asserts among a raft of allegations that the Applicant defrauded the business and that she was dismissed for serious misconduct as follows:
“(1). Financial loss of the business and the collapse of the office. $550,000 debt. Negative cashflows. Shareholders received nothing but putting $320,000 extra to pay off the debt. The total manged rent rolls reduced to 403 from 625.
(2). Sever industrial relations dispute with 5 complaints and two of them making the office To make compensations $25,000 to the employees by FWO judgements. Total number Of workers reduced to 2 only, from 17.
(3). Refuse to follow the instructions of the shareholders. Deny the access of the shareholders To engage with employees and to the office records.
(4). The system of managing prior to Regan was completely removed: no complete staff leave And performance records, no financial books or office spreadsheet on daily expenses or Incomes available. No regular service and maintenance of the company cars, so auditing For staff usages of cars and toll fees.
(5). She failed to achieve the KPIs she pledged to the shareholders with respect of rent Rolls and sales figures.” 27
[45] Claims are also made by way of the Small Business Fair Dismissal Code that the Applicant was dismissed because of unsatisfactory conduct, performance and capacity to do the job:
“8. Did you dismiss the employee because of the employee’s unsatisfactory conduct, performance or capacity to do the job?
✔ Yes
No
If Yes | YES NO |
a. Did you clearly warn the employee (either verbally or in writing) that the employee was not doing the job properly and would have to improve his or her conduct or performance or otherwise be dismissed? | ✔ emails trails sent previously |
b. Did you provide the employee with a reasonable amount of time to improve his or her performance or conduct? If yes, how much time was given? | ✔ as above |
c. Did you offer to provide the employee with any training or opportunity to develop his or her skills? | ✔ as above |
d. Did the employee subsequently improve his or her performance or conduct? | ✔ never |
e. Before you dismissed the employee, did you tell the employee the reason for the dismissal and give him or her an opportunity to respond? | ✔ but email trails warned her many times. |
f. Did you keep any records of warning(s) made to the employee or discussions on how his or her conduct or performance could be improved? Please attach any supporting documentation.” 28 | ✔ as above |
[46] The Respondents’ claimed “email trails” referred to in the checklist are not provided. Various other allegations of misconduct and poor performance are made against the Applicant and these are set out in a letter the respondent directed to me dated 24 January 2020 29
[47] The various allegations of misconduct and poor performance were put to the Applicant by me during the Hearing. The Applicant was clear in her sworn evidence that she refuted all of the allegations that were made against her. 30. Her evidence was clear, concise and credible in responding to the allegations and I prefer her sworn evidence to the unsubstantiated claims of the Respondent.
[48] Copies of emails from former employees were provided by the Respondent. The first of these is an email from Jasmine Farrell. 31 According to the Applicant, she is the daughter of Amanda Farrell, the replacement OIEC. That letter is titled “my resignation” and is addressed to Jordan. That letter is as follows:
“Good Morning Jordan,
I hope you are well
Firstly, i would like to thank you for the opportunity of bringing me on board back in May 2017, I wouldn’t have been able to grow and buy a house on my own without you.
Please don’t take my resignation personally, it wasn’t anything that you had done. It was a build up of many things over the last year.
While i appreciate Regan’s managing technique she was just a little full on, i think the change over of staff while she has been on board would prove this. From when Laura left in March of 2018 up to February 2019 i found her approach to be extremely full on, my anxiety and depression went through the roof and i would often find excuses not to come into the office. After my second disciplinary meeting i decided it was time to start looking for employment elsewhere as my heath is more important at the end of the day. I found her bullying technique to much to handle.
It also wasn’t all just Regan, there where small things that were happening within the office for example i haven’t had business cards since January, iv been asking when will they be coming in however i never get a straight answer. Iv been asking for payslips since January and i am yet to receive one unless I follow up for weeks, the fact that we have li��le staff is pu��ng an enormous amount of stress on top of myself, as i have been asked to do a fair of work for Ashlee’s por��olio while shes been on personal leave for example some of her Routine Inspections, her VCATS and just little things which is obviously impacting the workload of my own portfolio.
My pay was also a large factor, while i appreciate you are willing to match what the other agency has offered i’m upset that it took for me to leave for it to be matched, i feel for the amount of work that I was doing here it wasn’t appreciated and i felt like i was being taken advantage of.
I have put my heart and soul into this por��olio and i really am upset that ill be leaving.
I will always be a phone call away and i am happy to help the office if they need me i am happy to speak with you over the phone if you like
Thank you Again Jordan, i really do appreciate everything.
Have a great day!
Jasmine Farrell” 32
[49] The Applicant responded to that email as follows:
“Okay. So Jasmine was being performance managed because of the issues with her portfolio. They were being conducted in the way that you would, that Employsure put forward. And I know that she found that quite stressful. She - as it turns out, it’s actually her mother that actually bought into the business. But yes, we left on good terms. I’m quite surprised by that email.” 33
[50] I am satisfied that the Applicant performance managed Jasmine Farrell and that she found that to be stressful. The evidence of the Applicant supports that being reasonable management action, not a “bullying technique” as asserted by Ms. Farrell Beyond that, it is apparent that Ms. Farrell left the organisation for a range of other reasons unrelated to the Applicant.
[51] There is a message from Jay to Jordan. The contents are as follows:
“Hi Jordan
How are you.
It’s not about money it’s about relationships and love.
If you treat people like garbage they are going to treat you the same way. I don’t want to take name but you know it well.
We all like you but see what you have done, we all are in the same industry and making money for other than you. That’s why you business is not doing well.
We told you several times and talk with you but you never listen.
We 10 people left, if on average we sell 4 house a year that’s 20000 in you pocket multiple by 10 agent who were working for you plus the rental we bring from time to time.
Any way all the best just remember we all do like you.
Regards Jay” 34
[52] The Applicant’s response to the message from Jay was as follows:
“Yes? -So I wasn’t aware of any of that. And whether it’s something that Jordan has spoken to Jay. Like I said, Jordan has (indistinct) mobile. Jay (indistinct) left the business, he actually resigned. He resigned, from memory, about July last year.
Okay? -So I’m not sure why he sent an email to Jordan in February of this year about issues with the office.
Okay? -And he was in sales, yes.
Is there anything in there that’s of any relevance to you? I’m not suggesting there is, I just don’t know. I don’t really know what’s there? -(indistinct) ‘you treat people like garbage’, are we referring to Jordan or who? Yes, I don’t know.” 35
[53] The letter from Jay has no relevance that I can discern for the Applicant other than indicating that Jay holds Jordan, the former director, responsible for the downturn in the business.
[54] Then there is the rather odd email dated 5 October 2018 to Jordan from Rose Mathew which is said to be from an anonymous writer but is signed “with love” by 11 people but with first names only. The text of the email is as follows:
“Hi Jordan
We used to think you are a good person with good business knowledge but with absolutely surprised it seems you don’t have the basic knowledge of business and personal management skills with your employee.
How can you leave the total business in the hands of the evil manager Regan who is rude don’t know how to talk and deal with people, arrogant don’t listen to anyone problem and do what she like, she is a complete harassment and bully to all of us?
Or maybe you have your own reason, maybe you are too smart to get total loss and write off from the other profit by minimizing your tax who knows.
To be honest we all love you, and that’s why we are taking the pain to write this email as your eyes and ear are completely shut by the evil sorceress Regan.
To educate you during Rob’s time we were 12 sales people everyone was happy and you were earning more revenue from the business sale as well as from the rental referral from all of us.
But look at now due to that evil manager Regan
Very old and experience Vince left, Jalal got booted out, Abdul, Sarifa and Akram left frustrated. Jane file a lawsuit against you. All the experience Property manager left along with our good receptionist Dee.
Regan got a direct impact on moving all of your team from SDAL Werribee within a year and guess what!!! It has totally impacted your business. There are no sales on board and it will be like this as there are nothing in the pipe line for month to come and proper management are going to other agencies.
How couldn’t you have not predicted this down fall.
Regan will buy back the business from you at a minimum cost and employed all of us back, because its not hard for entrepreneur to understand the future prospect of a success and strategy that she has placed. Your downfall will be her success.
You cannot sleep with your eyes open for too long you have already sleep for a year now so please wake up. Come to the office talk with your staff who are out of the job and who are in too, listen to them because to my most understanding everyone loves and like you.
This is a personal email, you don’t need to escalate it the writer of this email is anonymous,
We all love you and it’s a wake-up email if you want to save the business.
With love
Jane
Vince
Abdul” 36
[55] The Applicants response to this email was as follows:
“So I don’t know. And it has Rose Matthew on the email address. So does that mean it’s from that person? I don’t know? -Rose Matthew. I don’t know a Rose Matthew at all.
Okay? -At that time that that email was written, Jane had - okay, so there was some issues around Jane, who I had never worked with. Jane was in sales, and when I started in October of 2017 she was on sick leave, extended sick leave, to the point where - paid out all her entitlements and she was on her unpaid sick leave. She had had a major bypass operation. So I met her - like I said, I never worked with her, but - so had - anyway, so she - it was right through until about - yes, it would have been coming up to about the end - so that was 2017 when I started, so in around Easter of 2018 she rang me to say that she was well enough now and she was wanting to come back to work. And I said, ‘That’s great. I need a doctor’s certificate to say that you’re able to come back to your work duties.’ And that’s when she said that I had dismissed her, that - anyway, and yes. So that’s about the time that that email was sent.
Okay? -That’s all I can think of around that. As far as the names, I know, because at the time Jordan actually sent this to me, because he wanted to know who I thought it was from, and I thought it could have been Jane’s daughter, because Sal mentioned that her daughter was called Rose. And I said to Jordan, I said - and then Jordan said, ‘Look, let’s not worry about it,’ blah, blah, blah, ‘But I just wanted you to know about it.’ Now, at that time a lot of those people still worked for the company. And the fact that Jane is named first, and she’s referred to quite a bit in that email, I’m guessing that’s Jane’s daughter. Then Abdul, Jay, Gerry, Esme, they were all still pretty much working there, and they knew nothing about this email.” 37
[56] The Applicant disputed the claims in the email that she was evil and that she was an “evil sorceress” and stated that she considered them defamatory. 38 I accept the evidence of the Applicant that Jordan, the director at the time, told her not to worry about the email and that it is not known who the source of the email is. In the circumstances, the email is of no probative value and I place no weight upon it.
[57] In order to comply with the Small Business Fair Dismissal Code, the Code states that in respect to summary dismissal that :”It is fair to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal.” 39 In this matter, the Applicant was not dismissed summarily, indeed, she was asked to assist the person replacing her to allow a smooth transition and provided a notice period. In any case, there is no basis in the evidence to find that the Respondent had reasonable grounds to believe that the Applicant had engaged in misconduct. The employer must establish that they had reasonable grounds to hold the belief, which could be established by providing evidence of inquiries or investigations the employer undertook to establish their belief.40 In this matter there is no cogent evidence to establish that any such reasonable grounds existed. There was no mention in the letter of termination of alleged misconduct or poor performance of the Applicant. While this is not a case of summary dismissal, I am nevertheless not satisfied that the Respondent had reasonable grounds to hold the belief that the Applicant had engaged in misconduct.
[58] In cases of non-summary dismissal, the employee must be warned that if there is no improvement to their conduct or capacity, they could be dismissed; the employee must be given a reason as to why their employment is at risk and the reason must be a valid reason based on their conduct or capacity to do the job and; the employer must give the employee an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations. 41 In this matter, it is apparent from the sworn evidence of the Applicant, whose evidence I accept over the unsubstantiated and unsupported claims of the Respondent, that there was no warning given to the Applicant and no reason was given as to why the Applicants employment was at risk. Moreover, there was no valid reason based on the Applicant’s capacity or conduct to do the job. I note that in the Form F3, the Respondent’s representative at that time stated “Whilst her conduct and performance was not the principle reason for the termination of employment, since her termination a number of poor performance issues which would have justified dismissal have been revealed.”42 This is completely at odds with the claims of the Respondent subsequent to the filing of Form F3 that there had been warnings for poor performance.
[59] If an employee claims to the Commission that they have been unfairly dismissed, the employer will have to prove that they have complied with the Code. 43 The Respondent in this matter has manifestly failed to prove compliance with the Code. It follows that the termination of the Applicant’s employment was not consistent with the Small Business Fair Dismissal Code.
Was the dismissal unfair?
[60] There is now the matter of considering if the dismissal is unfair having regard to s.387 of the Act. It is those matters that I now turn to having regard to the evidence.
A. Valid reason
[61] I am satisfied on the evidence that the various claims of misconduct, serious misconduct and poor performance directed at the Applicant are baseless. The sworn evidence of the Applicant that there was no misconduct or poor performance on her part are credible and not contradicted by any sworn evidence to the contrary given that the Respondent failed to appear at the hearing.
[62] The Applicant’s evidence is consistent with the letter of termination which makes no mention whatsoever of the Applicant’s alleged poor performance, let alone serious misconduct. While there is reference to a “down turn” in the business since July 2018 there is no suggestion in the letter of termination that the Applicant is held responsible for that. Rather the shareholders are said to have determined that they cannot support the Applicant’s salary due to financial hardship. Indeed, the Respondent sought that the Applicant work with her replacement for a period of time to allow transition. This would be an unusual step to say the least to take in circumstances where the Respondent actually believed that the Applicant had defrauded the business.
[63] I am not satisfied that the Applicant had engaged in any form of misconduct. Nor am I satisfied that there was any poor performance on the part of the Applicant.
[64] In conclusion, I am not satisfied that there is a valid reason for the dismissal of the Applicant. The reason appears to have been a desire to simply replace the Applicant with another employee. Further, it was clear that the Respondent was unhappy with the amount of remuneration the Applicant was earning. This is certainly not a sound, defensible or well-founded reason for dismissal. 44 It seems that the Respondent places some reliance on the terms of the employment contract which provides for termination with four weeks notice. However, the valid reason for termination is not to be judged by a legal entitlement to terminate an employee, “but [by] the existence of a reason for the exercise of that right’ related to the facts of the matter.”45. I am not satisfied on the evidence that there is a valid reason for the dismissal. This weighs towards a finding that the dismissal was unfair.
B. Notification of the reason.
[65] Notification of the “reason” relates to the “valid reason” for dismissal. 46 I am not satisfied that there is a valid reason for the dismissal in this case. However even if I am wrong about that finding, it is apparent that there was no notification to the Applicant of the reason for the dismissal before the decision to terminate was made.47
C. Opportunity to respond
[66] For the Commission to have regard to whether an employee has been given an opportunity to respond to the reason for dismissal, there needs to be a finding that there is a valid reason for dismissal. 48 It is apparent that there is no valid reason for the dismissal and so this is not a matter which is relevant. Although again, in the event that I was wrong on the question of valid reason, there was no opportunity given to respond to the Applicant before the decision to terminate was made.
D. Unreasonable refusal to support person.
[67] There was no request for a support person by the Applicant. This is a neutral consideration.
E. Warnings – Unsatisfactory performance
[68] As stated above, I am not satisfied that the Applicant’s performance was unsatisfactory. In any case, it is clear on the evidence that the Applicant was not warned about any alleged performance issues.
F. Size of employer’s enterprise and human resources specialists
[69] The Respondent is a small business and does not appear to have had the benefit of any in-house human resources specialist advice. While there is an acknowledgement that small businesses are genuinely different in nature both organisationally and operationally, the procedures followed in dismissing a person cannot be ‘devoid of any fairness.’ 49 In this matter, the process of dismissal was almost completely lacking in fairness. The giving of a period of notice is the only aspect of the process that provided some veneer of fairness. However, as the evidence is that the Applicant was not paid for the period of notice, that veneer is wafer thin. Overall this is a neutral consideration.
G. Other relevant matters
[70] The Applicant was employed in a high paying job and in a job that she enjoyed. She has had some difficulty obtaining secure work since the time of the dismissal.
Conclusion
[71] Taking into account all of the factors above, the factors all either weigh towards a finding of unfairness or are neutral considerations. There are no considerations weighing towards a finding that the dismissal was fair. Taking into account all of the matters set out above, I am satisfied that the dismissal was unjust as the employee was not guilty of the alleged conduct and poor performance. It was also harsh on the employee due to the economic and personal consequences of being dismissed. I am satisfied that the dismissal was unfair.
Remedy
[72] The relevant provisions of the Act pertaining to remedy are contained in s.390 of the Act:
“390 When FWA may order remedy for unfair dismissal
(1) Subject to subsection (3), FWA may order a person’s reinstatement, or the payment of compensation to a person, if:
(a) FWA is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) FWA may make the order only if the person has made an application under section 394.
(3) FWA must not order the payment of compensation to the person unless:
(a) FWA is satisfied that reinstatement of the person is inappropriate; and
(b) FWA considers an order for payment of compensation is appropriate in all the circumstances of the case.
Note: Division 5 deals with procedural matters such as applications for remedies.
[73] It also necessary to consider the Objects of Part 3-2 of the Act especially s.381(c) of the Act which provides that an object of that Part of the Act is to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement.
[74] The presumption in the legislation is that should a dismissal be found to be unfair, that reinstatement is the primary remedy and that compensation is a secondary consideration if reinstatement is not appropriate.
[75] In this matter, the Applicant does not seek reinstatement. The Applicant thinks that her relationship with the organisation has completely broken down and that reinstatement would not be viable. 50 Having taken that into account I agree that reinstatement in the circumstances of this case is not an appropriate remedy.
[76] Having determined that reinstatement is not appropriate I must consider what compensation, if any, is payable, in lieu of reinstatement.
[77] The Act provides for compensation as a remedy for unfair dismissal.
“392 Remedy—compensation
Compensation
(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.
Criteria for deciding amounts
(2) In determining an amount for the purposes of an order under subsection (1), FWA 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 FWA considers relevant.
Misconduct reduces amount
(3) If FWA is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, FWA 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 FWA 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 FWA 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.
393 Monetary orders may be in instalments
To avoid doubt, an order by FWA under subsection 391(3) or 392(1) may permit the employer concerned to pay the amount required in instalments specified in the order.”
[78] In all of the circumstances, I consider that the award of some amount of compensation is appropriate in this matter.
[79] In determining the amount of compensation, I must have regard to “all the circumstances of the case” including each of the paragraphs in s.392(2) of the Act as set out above. No one matter is paramount, but regard must still be had to each of them. 51
[80] The general approach to the calculation of compensation was well set out by the Full Bench in Tabro Meat Pty Ltd v Kevin Heffernan 52 and I will follow that approach in determining this matter.
Section 392(2)(c) - the remuneration that the person would have received or would have been likely to receive, if the person had not been dismissed.
[81] The Applicant’s annual salary at the time of the dismissal was $109,590.00 gross per annum with superannuation of 9.5%. 53 The Applicant was paid an allowance to offset the cost of the real estate licence she was required to hold in the position, as well as allowances to compensate for the cost of the use of her phone and car which are not relevant to the calculation of earnings . The amount of $109 590 per.annum will be used as the basis for the calculation.
[82] I have no submissions from the Respondent as to how long it was expected the employment relationship would have continued were it not for the dismissal taking place.
[83] The Applicant gave evidence she had no intention of leaving the workplace and that she enjoyed working with the people that she worked with. 54
[84] I think it is reasonable to assume that, but for the dismissal, that in all of the circumstances the employment relationship would have continued for a further period of two years.
[85] Accordingly, I calculate the remuneration that the Applicant would have received or would have been likely to receive, if her employment had not been terminated, at $219,180.00 plus 9.5% superannuation.
Section 392(2)(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 section 392(2)(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
[86] In the circumstances of this matter, ss.392(2)(e) and 392(2)(f) of the Act can be dealt with together. The Applicant has been able to obtain some employment as a “temp” working for Octagonal Wines, a wine wholesaler. Her rate of remuneration is significantly less with the current employer at $32.00 per hour compared to approximately $55.00 per hour with the Respondent.
[87] The amount earned by the Applicant since the time of the dismissal until the day of the hearing of the matter on 4 April is $24,962.00 55. This amount was earned during the period 7 October 2019 until 4 April 2020, a period of approximately six months. This represents an annual rate of earnings of $49,924.00. While the nature of the Applicant’s employment is one of temporary or casual engagement, there was at least until the time of the hearing a regular pattern of employment. There is no other remuneration earned by the Applicant since 4 October 2019.
[88] The Applicant was asked by me during the hearing if the work she was currently undertaking was secure work. Her reply was as follows:
“I can work out, I guess, an average value of, you know, what you were earning monthly. You expect that to continue into the future? That seems to be – is that secure, that work, or you don’t know? -Not with the COVID-19.
Right? -Because I’m a temp, yes, I’m expecting to lose this temporary assignment. Because I move from assignment to assignment, because I’ve been looking for obviously a role like I had, of that calibre don’t come up very often in this industry, and so I was temping as property manager just to have some income coming in. With the COVID-19, the opportunities for permanent employment have just about gone to zero, because I don’t think any companies, or particularly in my industry, are looking at taking anyone new on because it’s unknown as to what’s going to happen and how long it’s going to go for. Secondly - that goes the same with temporary assignments. So they only have to – the assignment only has to give me an hour’s notice that it’s finishing, and then I don’t – I know that the agency I usually work through, they’ve normally had up to about 40 temps. They’ve only got three currently in assignments, and I’m one of them.
Right. Okay? -So yes, I can’t see me earning more money.
Yes, and you’re not sure how long your current arrangement with the – what are they called, the Octagonal Wines will continue? -Yes, exactly, considering the lockdown.” 56
[89] In Ellawalla v Australian Postal Corporation 57, with respect to a precursor provision, the Full Bench stated that “[o]nly monies earned during the period from termination until the end of the anticipated period of employment are deducted”.
[90] I think it is reasonable to assume that the Applicant faces some risks from her employment not being secure. However, her current employer in the wine industry will not necessarily suffer as a result of COVID-19 as it is apparent that alcohol sales have and will continue during the pandemic. I am satisfied in the circumstances the Applicant will continue to earn from her recently secured position until the end of the anticipated period of employment.
[91] A deduction is therefore appropriate of $99,848.00 representing the monies earned and likely to be earned during the period from termination until the end of the anticipated period of employment. This deduction results in an amount of $119,332.00 plus 9.5% superannuation.
Section 392(2)(g) - any other matter that FWA considers relevant
[92] Ordinarily a deduction for contingencies is appropriate. 58 A deduction for contingencies is appropriate in this case. While the percentage to be deducted for contingencies is a matter for judgement, I think that a deduction of 25% is appropriate in the circumstances of this matter.
[93] This results in a provisional amount of compensation of $89,499.00 plus 9.5% superannuation.
[94] There are no other matters that are relevant to the determination of compensation other than ss.392(2)(a),(b) and (d), 392(3) and 392(5) of the Act. I will turn to those factors now.
Section 392(2)(a) - the effect of the order on the viability of the employer’s enterprise
[95] The Applicant was asked if there were any views that she had on this matter. She replied as follows:
“So I will just ask you some questions that are directed to getting me some information about that from your perspective and your knowledge. The first one is, ‘The effect of the order’ - and when it says order, we’re talking about a compensation order - ‘on the viability of the employer’s enterprise.’ Have you got – now, this is typically something the employer would comment on, but they’re not here. But have you got any views about whether there would be an effect on the viability of the employer’s enterprise if I make an order for compensation? -Firstly he has since sold the rent roll.
Right? -And so there is different entity now operating as Stockdale & Leggo Werribee.
Right? -He has also sold his other entity, which was another real estate rent roll, which was Jay Pty Ltd, his city office. He has also sold the grocery, which was under Jenni International as well. So I would be very surprised if there were no funds available and they will be in financial hardship.
That’s Jenni International, that is, your employer? -Yes”.” 59
[96] There were no submissions made by the Respondent on the financial position of the Respondent and whether there might be an impact on the viability of the Respondent if an order for compensation was made. In the absence of any evidence to the contrary, I do not expect the award for compensation to affect the viability of the Respondent.
Section 392(2)(b) - the length of the persons service with the employer
[97] The Applicant was employed by the Respondent for approximately two years. I do find that the relatively short length of service provides a basis for reducing the amount of compensation to be awarded. I will deduct an additional 10% to account for the relatively short period of employment. This results in a provisional amount of compensation of $80,999.10 plus 9% superannuation.
Section 392(2)(d) - the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal
[98] Evidence was provided by the Applicant as to the efforts she went to in the period after the dismissal to secure alternative employment. The Applicant clearly moved quickly to secure some alternative employment and succeeded within a week of her termination of employment. The Applicant supplied copies of numerous applications she has made on SEEK to secure employment in the real estate industry. Her additional evidence on the point was:
“And so I rely on those. Is there anything else you want to say about that particular matter? Were there any other efforts you want to bring to my attention? -(Indistinct) SEEK there’s probably five agencies that I’m aligned with that I’ve worked with before, for permanent roles as well, so RECD, (indistinct) yes, there are four or five that I’m registered with as well that only deal in the real estate industry.” 60
[99] The Applicant’s mitigation efforts are considerable and sufficient to exclude any further deduction from the quantum of $80,999.10 plus 9% superannuation.
Section 392(3) - misconduct
[100] I have found that the Applicant was not dismissed for a valid reason and that no misconduct was in evidence. Therefore there is no basis to make a further deduction for misconduct.
Section 392(5) - compensation cap
[101] As the amount of $80,999.10 plus 9.5% superannuation is more than the legislative compensation cap a further deduction for that reason is required. The amount of the compensation cap in this case is $54,750.00 plus 9.5% superannuation (that being the total amount of remuneration to which the Applicant is entitled for a period of 26 weeks).
Conclusion and order as to remedy
[102] I find that reinstatement is not an appropriate remedy in this case.
[103] I find that compensation is appropriate.
[104] I am satisfied that an order for payment of compensation by the Respondent of $54,795.00 gross plus 9.5% superannuation less tax as required by law, to the Applicant in lieu of reinstatement is appropriate in all the circumstances of the case. It accords a fair go all round to both the Respondent and the Applicant.
[105] The compensation payment, less any required deduction in taxation, is to be made within 14 days of this decision. An order to that effect will be issued concurrently with this decision.
COMMISSIONER
Appearances:
Ms Regan Jennifer Susan Bell the Applicant
Hearing details:
2020
4 April
Printed by authority of the Commonwealth Government Printer
<PR719655>
1 In submissions by the Applicant, Respondent and my Chambers, the Respondent is addressed as; Ms Lei, San, Lee Pui San and Ms Lee. Any reference in this document to Ms Lei, Ms Lee, Lee Pui San or San is taken to be referring to Ms Pui San Lei.
2 Email from Fair Work Commission sent on 19 March 2020.
3 Email from Respondent dated 3 April 2020.
4 Court book, page 34.
5 Applicant’s Form F2 – Unfair dismissal application (Form F2) dated 18 October 2019; Court book, page 29.
6 Applicant’s Form F2 – Unfair dismissal application (Form F2) dated 18 October 2019; Respondent’s Form F3 – Employer response to unfair dismissal application (Form F3) dated 12 November 2019.
7 PN35.
8 PN22 – PN30.
9 Court book, page 34.
10 Court book, page 13.
11 PN50 – PN51.
12 Email from Respondent dated 28 February 2020.
13 Court book, page 15.
14 Court book, pages 18-27.
15 Court book, page 21.
16 Court book, page 23.
17 Court book, pages 28-29.
18 Court book, page 34.
19 Court book, page 78.
20 Court book, page 3.
21 Court book, page 83.
22 Court book, page 86.
23 PN98 – PN112.
24 Benchbook on Unfair Dismissal – sees page 87.
25 [2012] FWAFB 1359.
26 Pinawin T/A RoseVi.Hair.Face.Body v Mr Edwin Domingo[2012] FWAFB 1359, [29]-[38].
27 Court book. page 84.
28 Court book, page 85 -86.
29 Court book, pages 75-77.
30 PN135 – PN204.
31 Court book, page 88.
32 Court book, page 88.
33 PN210.
34 Court book, page 89.
35 PN215 – PN218.
36 Court book, page 90.
37 PN221 – PN223.
38 Ibid.
39 Small Business Fair Dismissal Code.
40 Harley v Rosecrest Asset Pty Ltd T/A Can Do International [2011] FWA 3922 (McCarthy DP, 21 June 2011) at para. 9; cited with approval in Pinawin T/A RoseVi.Hair.Face.Body v Domingo [2012] FWAFB 1359 (Watson VP, Richards SDP, Cloghan C, 21 March 2012) at paras 28–29, [(2012) 219 IR 128].
41 Small Business Fair Dismissal Code.
42 Court Book, page 15.
43 Small Business Fair Dismissal Code.
44 Selvachandran v Peteron Plastics Pty Ltd [1995] IRCA 333 (7 July 1995), [(1995) 62 IR 371 at p. 373].
45 Miller v University of New South Wales [2003] FCAFC 180 (14 August 2003) at para.13, [(2003) 132 FCR 147].
46 Chubb Security Australia Pty Ltd v Thomas Print S2679 (AIRCFB, McIntyre VP, Marsh SDP, Larkin C, 2 February 2000) at para. 41.
47 Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport Print S5897 (AIRCFB, Ross VP, Acton SDP, Cribb C, 11 May 2000) at paras 70–73, [(2000) 98 IR 137].
48 Chubb Security Australia Pty Ltd v Thomas Print S2679 (AIRCFB, McIntyre VP, Marsh SDP, Larkin C, 2 February 2000) at para. 41.
49 Williams v The Chuang Family Trust t/a Top Hair Design [2012] FWA 9517 (Cloghan C, 12 November 2012) at para. 40.
50 PN244.
51 Tempo Services Limited v Klooger and Others, PR953337, [22]
52 [2011] FWAFB 1080
53 Court book, page 20.
54 PN271
55 PN254-262.
56 PN273 – PN276
57 Print S5109
58 See Slifka v JW Sanders Pty Limited (1995) 67 IR 316 at 328
59 PN264 – 267.
60 PN278.
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