Rick Adaszko v Mitford Investments Pty Ltd ATF the JJG Trust T/A Integro Private Wealth
[2020] FWC 5497
•11 DECEMBER 2020
| [2020] FWC 5497 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Rick Adaszko
v
Mitford Investments Pty Ltd ATF The JJG Trust T/A Integro Private Wealth
(U2020/11708)
DEPUTY PRESIDENT BINET | PERTH, 11 DECEMBER 2020 |
Application for an unfair dismissal remedy - Unfair dismissal application filed out of time – circumstances not exceptional - application dismissed
Introduction
[1] On 28 August 2020, Mr Rick Adaszko (Mr Adaszko) filed an application (Application) pursuant to section 394 of Fair Work Act 2009 (Cth) (FW Act) with the Fair Work Commission (FWC) alleging he was unfairly dismissed by Mitford Investments Pty Ltd as trustee for the JJG Trust trading as Integro Private Wealth (Integro).
[2] Subsection 394(2) of the FW Act states that an application for an unfair dismissal remedy must be made ‘within 21 days after the dismissal took effect’, or within such further period as the FWC allows, pursuant to sub section 394(3). Mr Adaszko concedes that the Application was made more than 21 days after his employment terminated. Mr Adaszko asks the FWC to grant a further period for the Application to be made under s 394(3).
[3] Integro deny that the Mr Adaszko was dismissed and say instead that he resigned. Integro opposes Mr Adaszko’s request for an extension of time to make the Application, on the basis that Mr Adaszko did not advance any reason, or evidence, to explain the delay that were of an exceptional nature and that would also enliven the FWC’s discretion to grant an extension.
[4] Taking into account the parties wishes and circumstances, it was determined that a hearing rather than a determinative conference would be the most effective and efficient way to determine the Application. Consequently, the Application was listed for a hearing in Perth on Friday, 16 October 2020 (Hearing).
[5] Directions for the filing of materials in advance of the Hearing were issued to the parties on 31 August 2020, with further directions issued on 2 September 2020 (Directions).
Permission to be represented
[6] The Directions invited the parties to make submissions as to whether the FWC should grant permission to the parties to be represented. A determination of this issue is necessary to ensure that the manner in which any hearing is conducted is fair and just.1
[7] Subsection 596(1) of the FW Act provides that a party may be represented in a matter before the FWC by a lawyer or paid agent only with the permission of the FWC. Subsection 596(2) of the FW Act provides that the FWC may grant permission for a person to be represented by a lawyer or paid agent in a matter before the FWC only if:
a. it would enable the matter to be deal with more efficiently, taking into account the complexity of the matter; or
b. it would be unfair not to allow the person to be represented because the person is unable to represent himself, herself or itself effectively; or
c. it would be unfair not to allow the person to be represented taking into account fairness between the person and other persons in the same matter.
[8] Having considered the submissions of the parties, I decided to exercise my discretion to grant permission for Integro to be represented.
Evidence
[9] At the hearing Mr Adaszko represented himself and provided evidence written and oral evidence on his own behalf.
[10] At the Hearing, Integro was represented by Mr Damian Molony, a solicitor of Armeli & Molony Lawyers. The Managing Director of Integro, Mr Justin Gilmour (Mr Gilmour), provided written and oral evidence on behalf of Integro.
Background
[11] Mr Adaszko says he commenced employment with Integro as a Financial Advisor on 9 March 2016. 2 Integro say that he commenced employment on 16 April 2016. The contract of employment tendered in these proceedings indicates that Mr Adaszko’s commencement date was 14 March 2016.3
[12] On 27 February 2017, Mr Adaszko and Integro entered into a loan agreement whereby Integro advanced Mr Adaszko a sum of money to ‘purchase’ clients from Mr Adaszko’s previous employer (Loan Agreement). 4
[13] On 15 October 2019, Mr Gilmour held a meeting with Mr Adaszko in relation to reports of negative feedback from clients about Mr Adaszko’s performance. At that meeting, Mr Gilmour and Mr Adaszko discussed whether Mr Adaszko preferred to resign or undergo performance counselling. Mr Gilmour says that Mr Adaszko informed him that he would be resigning from his position as soon as he had secured alternative employment. 5
[14] On 20 November 2019, an agreement was reached as to the arrangements for Mr Adaszko’s separation from Integro. These arrangements were captured in an email dated 20 November 2019 tendered as an exhibit in the proceedings and set out below(the bold text being Mr Adaszko’s response to the terms proposed by Mr Gilmour) (Separation Arrangements):
“Hi RA,
Mate below is what we are intending to send out as a comms to the staff. Do you have any feedback on this as we would like to send this by COB today. If you can provide the letter of resignation and we will at the same time give you the release document of the loan for the $40K. – email to staff is fine, Yes I will prepare a resignation letter today
In relation to your request for an additional two weeks pay beyond the notice period of December. Given the time of the year with clients wrapping up before Christmas I am happy to support you with a loan of $5K as a means of assisting you to manage your cash flow. There is also the study support that needs to be sorted which I understand is $3630 over the past two years which we can add to the loan instead of deducting from the final payroll. This would need to be repaid by 31st March 2020.- okay, that would be great. Thankyou
If you would like to go ahead with this loan agreement proposal I will have Phil update the waiver today. – ok, yes please proceed”
[15] In accordance with these arrangements, Mr Adaszko forwarded a signed letter of resignation dated 22 November 2019 to Mr Gilmour on 22 November 2019 (Resignation Letter) stating as follows: 6
“As discussed, I have decided to resign from Integro to pursue other opportunities where I can spend more time in the southwest, my last date at Integro will be 13 December 2019.
Thanks for all your support, I have enjoyed my time at Integro.”
[16] Mr Adaszko says that he continued to work for Integro until 16 December 2019 handing over clients to a new advisor. 7
[17] Mr Gilmour says that Mr Adaszko‘slast date of work was 13 December 2019. 8
[18] Mr Adaszko’s payslip indicates that his last day of employment occurred in the week ending 15 December 2019, and that Integro withheld amounts for study costs and legal fees from his final pay. Mr Adaszko claims that they were not entitled to do so. He says that he ultimately did not proceed with the ancillary loan of $5,000.
[19] On 9 December 2019, Mr Adaszko was provided with a draft Deed of Acknowledgement providing for the discharge of the loan agreement. Mr Adaszko was not satisfied with the terms of the Deed of Acknowledgement. On 19 December 2019, he sought legal advice about the Deed and says that he was told that he should not sign the Deed.
[20] On 29 May 2020, Integro commenced proceedings against Mr Adaszko in the Magistrates Court of Western Australia in GCLM/7169/2020 (Magistrate Court Proceedings) to enforce the Loan Agreement.
[21] On 28 August 2020, Mr Adaszko filed the Application.
Consideration
[22] Subsection 394(2) of the FW Act provides that an application for an unfair dismissal remedy must be made ‘within 21 days after the dismissal took effect’, or within such further period as the FWC allows pursuant to subsection 394(3) of the FW Act.
Was Mr Adaszko dismissed and if so when?
[23] Mr Adaszko submits that he was notified of his dismissal on 20 November 2019 and that his dismissal took effect on 16 December 2019. Integro submit that Mr Adaszko resigned effective 13 December 2019, and was not dismissed for the purposes of the FW Act.
[24] The term ‘dismissed’ is defined in section 386 as follows:
“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.”
[25] Section 386(2) contains some exceptions which are not applicable to this Application.
[26] Mr Adaszko concedes that he resigned from his employment but submits that he was forced to do so because of the conduct or course of conduct engaged in by Integro.
[27] Mr Adaszko describes the conduct which he says forced him to resign as follows: 9
“I was asked to resign verbally by Justin Gilmour, principle of Integro and also via email on 20th November 2019 … otherwise I would be placed on performance counselling which would be unpleasant even though I was meeting my targets and objectives …
… in turn [for resigning] Justin Gilmour would forgive a loan agreement dated February 2017 which was created as result of Justin settling a legal dispute between myself and my previous employer …”
[28] The onus is on the employee who asserts that they were forced to resign to prove that they did not resign voluntarily.10 The employee must prove that the employer forced the employee’s resignation by identifying action on the part of the employer to bring the relationship to an end or action that has that probable result.11
[29] The line distinguishing conduct that leaves an employee no effective or real choice but to resign from an employee resigning at their own initiative is a narrow one. The requisite employer conduct is an essential element.12
[30] The FWC has held in a number of comparable cases that a resignation tendered to avoid disciplinary action or performance management does not constitute a dismissal for the purposes of the FW Act because it lacks the necessary conduct on the part of the employer of removing choice from the employee.
[31] In this case, Mr Adaszko did have a real choice. He could remain with the organisation and undergo performance management or he could chose to leave the organisation. If, as he says, his performance was without fault then he had nothing to fear from the performance management process. If his employer acted without basis and terminated his employment for poor performance he could seek a remedy for unfair dismissal.
[32] The Separation Arrangements Email, which Mr Adaszko tendered as evidence of conduct forcing him to resign makes no reference to performance counselling or to a requirement that he resign. What it does evidence is the offer of an arrangement that, if he were to resign, he would be released from the Loan Agreement and that he would be extended another loan of $5000 to cover his study expenses and provide him with cashflow over the Christmas period.
[33] In the Separation Arrangements Email Mr Adaszko confirms his consent to the arrangements with the words “okay, that would be great. Thank you.”
[34] The language of the email does not convey any animosity or compulsion, rather there appears to be a mutually agreeable commercial arrangement reached.
[35] I am not satisfied that Mr Adaszko was forced to resign from his employment because of conduct, or a course of conduct, engaged in by his employer. To the contrary it appears that the parties parted ways on what were, at the time, mutually agreeable terms.
[36] In the event that I am wrong and Mr Adaszko’s resignation could be said to constitute a ‘dismissal’ for the purposes of section 386 of the FW Act, I have also considered whether Mr Adaszko ought to be granted an extension of time to lodge the Application.
[37] Based on the Letter of Resignation and the Separation Negotiations, I find that Mr Adaszko’s employment ended on 13 December 2019. The Application was lodged on 28 August 2020. If Mr Adaszko was dismissed for the purposes of the FW Act, the Application is 259 days or 8 months, 2 weeks and 1 day out of time.
Do exceptional circumstances exist?
[38] The FW Act allows the FWC to extend the period within which an unfair dismissal application must be made only if it is satisfied that there are ‘exceptional circumstances’. Exceptional circumstances are circumstances that are out of the ordinary course, unusual, special or uncommon but the circumstances themselves do not need to be unique nor unprecedented, nor even very rare. 13 Exceptional circumstances may include a single exceptional matter, a combination of exceptional factors, or a combination of ordinary factors which, although individually of no particular significance, when taken together can be considered exceptional.14
[39] Section 394(3) of the FW Act requires that, in considering whether to grant an extension of time, the FWC must take into account the following:
a. the reason for the delay;
b. whether the person first became aware of the dismissal after it had taken effect;
c. any action taken by the person to dispute the dismissal;
d. prejudice to the employer (including prejudice caused by the delay);
e. the merits of the application; and
f. fairness as between the person and other persons in a similar position.
[40] The requirement that these matters be taken into account means that each matter must be considered and given appropriate weight in assessing whether there are exceptional circumstances.
Were there reasons for the delay?
[41] The onus is on Mr Adaszko to provide a credible reason for the delay.
[42] While the delay to be considered is the period subsequent to the expiration of the 21 day period, the circumstances from the time of the dismissal must be considered in determining whether the reason for the delay constitutes exceptional circumstances.15
[43] In Diotti v Lenswood Cold Stores Co-op Society t/a Lenswood Organic,16 the Full Bench explained the correct approach by reference to the following example:
“For example, if an applicant is in hospital for the first 20 days of the 21 day period this would be a relevant consideration if the application was filed 2 days out of time as occurred in this matter.”
[44] The Act does not specify what reason for delay might tell in favour of granting an extension, however, decisions of the Commission have referred to an acceptable or reasonable explanation. Ignorance of the 21 day timeframe is not, of itself, an exceptional circumstance. 17
[45] The absence of any explanation for any part of the delay will usually weigh against an applicant in the assessment of whether there are exceptional circumstances, and a credible explanation for the entirety of the delay will usually weigh in the applicant’s favour, however all of the circumstances must be considered. 18
[46] Mr Adaszko explained the reason for the delay was that:
a. he was not provided with the Deed of Acknowledgement until 9 December 2019;
b. he did not find the terms of the Deed of Acknowledgement acceptable; and
c. as a result of him not signing the Deed of Acknowledgment Integro commenced legal action against him.
[47] Mr Adaszko chose to tender his resignation on 22 November 2019 before the Deed of Acknowledgement was signed by the parties. If his resignation was conditional on the terms of the Deed of Acknowledgement, he should not have resigned before those terms were agreed in a binding form.
[48] His resignation did not take effect until 13 December 2019.
[49] Having been provided with the Deed of Acknowledgement on or around 9 December 2019, Mr Adaszko did not then try to retract his resignation or file the Application.
[50] Having been advised by his legal advisors not to sign the Deed of Acknowledgement, on 19 December 2019, he did not file the Application. His explanation that he was busy seeking legal advice about the Deed of Acknowledgement only provides an explanation for the first 9 days after the termination of his employment.
[51] At the Hearing, Mr Adaszko sought to tender a medical certificate that indicated that he had attended his general practitioner in March 2020 and given medication for one month for anxiety, stress and insomnia. If it provides an explanation for the delay, it provides one only for a period of a month.
[52] On 29 May 2020, Integro commenced the Magistrate Court Proceedings to enforce the Loan Agreement. Mr Adaszko still did not file the Application.
[53] It was not until 28 August 2020 that Mr Adaszko finally filed the Application.
[54] I do not consider that Mr Adaszko’s reasons for the delay of 286 days either individually or collectively to be an acceptable or reasonable explanation for the delay.
Whether Mr Adaszko first became aware of the dismissal after it had taken effect
[55] Mr Adaszko says that he was notified of the dismissal on 20 November 2020 and that it took effect on 19 December. 19 He therefore was aware of his ‘dismissal’ as soon as it took effect and therefore had the full period of 21 days to lodge the unfair dismissal application.
[56] This factor weighs against Mr Adaszko being granted an extension.20
Did Mr Adaszko take action to dispute the dismissal?
[57] Action taken by an applicant to contest the termination, other than by virtue of making the application will be relevant and may weight in favour of granting the extension of time. 21
[58] Mr Adaszko did not take action to dispute the dismissal other than to file the Application. This circumstance weighs against the conclusion that there are exceptional circumstances.
Prejudice to the employer
[59] Prejudice to the employer will go against the granting of an extension of time. The mere absence of prejudice to the employer is an insufficient basis to grant an extension of time.22
[60] The employer must produce evidence to demonstrate prejudice. It is then up to the employee to show that the facts do not amount to prejudice.
[61] A long delay gives rise “to a general presumption of prejudice”.23
[62] Integro submit that it is prejudiced by the delay given that it is now forced to respond to events which happened a considerable time ago. I accept that there is some prejudice to Integro preparing its defence to the Application caused by the delay, and the resulting impact on witness memory and availability.
What are the merits of the Application?
[63] If a claim has merits, this will weight in favour of the grant of an extension of time.24
[64] In considering the merits of an application for an extension of time, the FWC is not normally in a position to make findings of fact on contested issues because to do so would require the parties in effect to present their evidentiary cases twice.25
[65] For the reasons outlined earlier in this decision, I am of the view that the Second Jurisdictional Objection would likely be upheld and the matter would not proceed to a consideration of the merits of Application.
[66] Consequently, this is a matter that weighs against a conclusion that there are exceptional circumstances.
Fairness as between Mr Adaszko and other persons in a similar position?
[67] The FWC may have consideration of fairness in matters of a similar kind that are currently before the FWC or have been decided in the past. This consideration is concerned with the importance of the application of consistent principles in cases of this kind; however, cases of this kind quite often turn on their own facts.26
[68] Neither party brought to my attention any relevant matter concerning this consideration, and I am unaware of any relevant matter. I, therefore, consider this to be a neutral consideration.
Conclusion
[69] Having regard to the matters I am required to take into account, under sub-section 394(3) of the FW Act, and all of the matters raised by Mr Adaszko, I am not satisfied that there are exceptional circumstances in this case, either when the various circumstances are considered individually or together. Because I am not satisfied that there are exceptional circumstances, there is no basis for me to allow an extension of time. I decline to grant an extension of time under sub section 394(3) of the FW Act.
[70] Accordingly, Mr Adaszko’s Application for an unfair dismissal remedy must be dismissed. An Order 27 to this effect will be issued with this Decision.
DEPUTY PRESIDENT
Appearances:
Mr Rick Adaszko for the Applicant
Mr Molony of Armeli & Molony Lawyers, solicitor for the Respondent
Hearing details:
2020:
Perth;
October 16.
Printed by authority of the Commonwealth Government Printer
<PR723572>
1 Warrell v Fair Work Commission [2013] FCA 291.
2 Digital court book (‘DCB’), 12.
3 Ibid 54.
4 Ibid 39-40.
5 DCB 34-35 and Hearing Audio
6 38
7 In his witness statement the Applicant identified the last day of his employment as 19/12 but amended it to 16/12 in the course of proceedings.
8 35
9 5
10 Australian Hearing v Peary (2009) 185 IR 359.
11 O'Meara v Stanley Works Pty Ltd, PR973462 (AIRCFB, Giudice J, Watson VP, Cribb C, 11 August 2006) (2006) 58 AILR 100, [23].
12 Doumit v ABB Engineering Construction Pty Ltd, Print N6999 (AIRCFB, Munro J, Duncan DP, Merriman C, 9 December 1996).
13 Nulty v Blue Star Group Pty Ltd[2011] FWAFB 975, [13].
14 Ibid.
15 Diotti v Lenswood Cold Stores Co-op Society t/a Lenswood Organic[2016] FWCFB 349, [31].
16 Ibid.
17 Nulty v Blue Star Group Pty Ltd (2011) 203 IR 1, [14].
18 Stogiannidis v Victorian Frozen Foods Distributors Pty Ltd[2018] FWCFB 901, [39].
19 DCB, 6.
20 Meek v Baycorp Pty Ltd t/a Baycorp Pty Ltd[2016] FWC 1291, [15].
21 Brodie-Hanns v MTV Publishing Ltd (1995) 67 IR 298, 300.
22 Ibid.
23 Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541, 556.
24 Haining v Deputy President Drake (1998) 87 FCR 248, 250.
25 Kyvelos v Champion Socks Pty Ltd (AIRCFB, Giudice J, Acton SOP, Gay C, 10 November 2000) Print T2421, [14].
26 Andrew Green v Bilco Group Pty Ltd[2018] FWC 6818, [31].
27 PR723575.
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