Samuel Sturrock v Per Melbourne Pty Ltd formerly Richtek Melbourne Pty Ltd (ACN 651665182)

[2024] FWC 977

[2024] FWC 977

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394—Unfair dismissal

Samuel Sturrock
v

Per Melbourne Pty Ltd formerly Richtek Melbourne Pty Ltd (ACN 651665182)

(U2024/59)

DEPUTY PRESIDENT BELL MELBOURNE, 1 JULY 2024

Application for an unfair dismissal remedy - whether genuine redundancy – no genuine redundancy - dismissal unfair – compensation ordered.

1. On 2 January 2024, Mr Samuel Sturrock made an application to the Fair Work Commission (Commission) for relief from unfair dismissal under s 394 of the Fair Work Act 2009 (the Act). Mr Sturrock alleges he was unfairly dismissed by the respondent, then called Richtek Melbourne Pty Ltd (ACN 651665182) and now called Per Melbourne Pty Ltd (ACN 651665182), (Richtek Melbourne) on 12 December 2023.

1. In its Form F3 Employer response, Ricktek Melbourne has raised a jurisdictional objection that the Applicant’s dismissal was a case of genuine redundancy (see s 389 of the Act). The employer’s Form F3 was signed by Mr Phillip Richardson in his capacity as “CEO”.

1. Upon the matter being allocated to me, I issued directions on 14 February 2024 for a mention/conference to be conducted on 20 February 2024 and for the filing of evidence and submissions. Given that the issue of genuine redundancy was raised, Richtek Melbourne was directed to file its initial material by 5 March 2024 and Mr Sturrock by 27 March 2024, with an opportunity for reply by Richtek Melbourne.

1. Mr Richardson attended the mention hearing on 20 February 2024. During the formalities of the mention hearing, the various dates in the directions were discussed and confirmed. While the matter then proceeded to a private conference to explore possible resolution of the matter, the matter did not resolve.

1. By 5 March 2024, Richtek Melbourne did not file any material. Upon inquiries by my chambers of Richtek Melbourne, no extension of time was sought or an explanation for non-compliance otherwise provided. To the commencement of the hearing of this matter on 16 April 2024, Richtek Melbourne or Mr Richardson failed to make any further communications with my chambers or the applicant at all.

1. Mr Sturrock filed his material by the required time.

1. At the hearing before me on 16 April 2024, Mr Sturrock was represented by Mr Kriewaldt of Jewel Hancock lawyers, with permission having been granted.

Failure to comply with order for attendance – Phillip Richardson

1. Notwithstanding that Mr Sturrock’s material was unchallenged, I was concerned about the possible solvency of Richtek Melbourne. This was due to a statement in the letter of termination it issued to Mr Sturrock and to the unexplained failure of Richtek Melbourne or its CEO, Mr Richardson, to communicate with the Commission at all about the matter after the mention hearing described above.

1. The letter of termination in December 2023 referred to “the continuing adverse impact of prevailing circumstances including changes in market demand and the need to streamline our operations” as a basis for redundancy. The unexplained failure to respond to communications and orders of Commission was possibly indicative of an indifference to any possible order the Commission might make in Mr Sturrock’s favour, simply because Richtek Melbourne would not be able to pay any judgment debt, regardless of its amount.

1. Upon conducting a company search of Richtek Melbourne on 27 March 2024, I also observed that Mr Richardson had been appointed as director of that entity on 8 March 2024 and then ceased holding that office on 19 March 2024, less than 2 weeks later.

1. On 26 March 2024, Richtek Melbourne changed its name to “Per Melbourne Pty Ltd”. The company was evidently active, just not in respect of the Commission.

1. The solvency or otherwise of a respondent is a matter relevant to any financial remedy. Another issue of relevance is whether a job advertisement with ‘Richtek’ in Brisbane that Mr Sturrock said he would have accepted as a redeployment was with an ‘associated entity’ of Richtek Melbourne within the meaning s 389(2) of the Act. These specific aspects were not matters that Mr Sturrock gave evidence about (nor, in fairness, would he necessarily be expected to know about such matters).

1. For these reasons, I issued an order under s 590(2)(a) of the Act requiring the attendance of Mr Richardson at 10.00am by Microsoft Teams on 16 April 2024. It was served upon him to the email address he specified in the Form F3 he signed. Additionally, my chambers alerted him by text message to his specified mobile telephone number and further attempted to call him.

1. Notwithstanding that the explanatory notes included with the order warned that it was an offence to fail to attend as required, Mr Richardson did not attend nor answer his mobile telephone shortly before the commencement of the hearing. No explanation has since been given to the date of this decision. The applicant was unaware of any reason for Mr Richardson’s non-attendance and his solicitor drew my attention to a recent matter[1] involving Mr Richardson as an indication that he was familiar with the Commission’s requirements. I will refer Mr Richardson’s non-compliance with the order for attendance to the General Manager of the Commission for any appropriate steps to be taken to ascertain if non-compliance with the attendance order warrants further investigation.

Factual findings

1. ‘Richtek’ is the trading banner for a business or group of businesses supplying electrical, plumbing, grouting and roofing needs. The target market appears to be residential customers.

1. The exact corporate structure of the entities trading under the Ricktek banner is not information I had before me. A company search indicates its principal place of business and registered office are both in Malaga, Western Australia. The sole director (other than the two week period referred to above) and shareholder is Wendy Panossian, whom I understand is possibly Mr Richardson’s mother. Ms Panossian had no involvement in the proceeding before me nor otherwise appeared to have any involvement in Mr Sturrock’s dealing with Richtek Melbourne.

1. Mr Sturrock estimates that Richtek Melbourne had around 30 employees during his employment.

1. In January 2023, Mr Sturrock commenced permanent employment with Richtek Melbourne as a grouting salesperson. His job included spending time on the road chasing sales leads and making sales, selling ‘regrouts’ and tiling work directly to customers at their houses. The role was located in Melbourne.

1. In August 2023, Mr Sturrock was promoted to the permanent role of Sales Manager, Victoria. At the hearing of the matter before me, Mr Sturrock explained that the Sales Manager role was not a role he particularly wanted at the time, because he saw more upside in a pure sales role. However, his view at the time was that someone needed to fill the vacancy in the role and, if no one did, it would impact adversely on the wider sales team, himself included. I accept Mr Sturrock’s explanation and also make the observation that he gave his explanations sincerely and struck me as an individual who was motivated to work and to do his best when working.

1. As Sales Manager, Mr Sturrock reported to the State Manager.

1. In early October 2023, the position of State Manager became vacant. Mr Sturrock was asked to fill that role but he indicated he wanted to remain as Sales Manager. For about a 4 – 6 week period, Mr Sturrock temporarily performed part of the State Manager role until a permanent appointment was made for another individual in early November 2023.

1. During this same period of October and November 2023, Mr Sturrock had also been conducting interviews to recruit sales personnel for Victorian staff. He was also aware from his role that recruitment was being undertaken for roles in Queensland and Western Australia by ‘Ricktek’ generally (albeit not necessarily the entity Richtek Melbourne, for the roles in Queensland and Western Australia). While Mr Sturrock was not aware of the corporate structure, his explanation to me at the hearing was that Mr Richardson runs all the ‘branches’. I have no reason to doubt that explanation.

1. On 1 December 2023, Mr Sturrock commenced a period of pre-approved annual leave. The leave was for Mr Sturrock’s honeymoon.

1. Unfortunately for Mr Sturrock, on 5 December 2023 and while still on leave, he received an email giving him 1 week’s notice for the termination of his employment upon the apparent grounds of redundancy.

1. The evidence before me shows that Mr Sturrock was not consulted at all prior to the receipt of the above letter. No evidence was provided by Richtek Melbourne to explain the lack of consultation, although with both Mr Richardson available and the State Manager, I infer any such evidence would not assist the employer.

1. Mr Sturrock says, and I accept, that there were sales roles being recruited in Brisbane at the time. While it is unusual to consider that Mr Sturrock would have relocated to Brisbane, in this case Mr Sturrock explained he would have. I accept his explanations.

1. Mr Sturrock also says, and I accept, that upon learning of the termination of his employment, he started looking for other work. Mr Sturrock’s explanations at the hearing demonstrated an impressive commitment to find and secure work elsewhere.

1. On 5 February 2024, he commenced full-time work elsewhere, albeit at a lower salary rate of $62,000 plus superannuation, which increased automatically to $78,000 plus superannuation upon successful completion of the ‘trainee’ period for his new role.

Consideration

1. Mr Sturrock was an employee protected from unfair dismissal: s 382. It was not in contention (even on the employer’s Form F3) that he had completed the minimum employment period of employment and was covered by a modern award (the Form F3 states the ‘Sales Award’ applied) and, in any case, his salary was below the high income threshold.

1. For the purposes of s 385, Mr Sturrock was “dismissed”, with the dismissal being at the initiative of the employer. The Small Business Fair Dismissal Code was not applicable.

1. Stated succinctly, I am satisfied that the dismissal was harsh, unjust and unreasonable, and that the dismissal was not a case of genuine redundancy.

1. The dismissal was harsh, unjust and unreasonable because no valid reason was established for the dismissal, the circumstances of the notification while on a honeymoon were particularly poor, and there was no other matter or circumstance that is otherwise relevant to indicate that, on an overall assessment, a different conclusion should be arrived at whether the factors in s 387 are taken together or assessed individually.

1. While the letter of termination referred to a redundancy, the employer led no evidence at all to make good that proposition beyond the assertion stated in that letter and the Form F3. The evidence and explanations given by Mr Sturrock indicate a contrary position. I prefer Mr Sturrock’s explanations. I do not accept there was any reason for dismissal based upon a redundancy. For this reason, I am not satisfied there was a “genuine redundancy” for the purpose of s 389 of the Act. Even if I was satisfied that there was a bona fide redundancy scenario, there was not a genuine redundancy owing to a complete failure to consult: s 389(1)(b). There was no dispute that a modern award applied to Mr Sturrock’s employment. While there might have been some debate as to which award applied, each award that could be relevant had a consultation term that was not complied with. I also consider on the material before me that it would have been reasonable for Mr Sturrock to have been redeployed as a salesperson in Brisbane: s 389(2).

1. Having regard to the above matters, I am satisfied that Mr Sturrock was unfairly dismissed within the meaning of s 385 of the Act.

1. My consideration now turns to whether a remedy should be ordered: s 390. Mr Sturrock does not seek reinstatement, and I have noted above he has successfully found full-time work elsewhere. I am satisfied that an order for reinstatement is inappropriate.

1. By contrast, I am satisfied that an order for compensation is appropriate in all the circumstances of the case.

1. On the evidence before me, I am satisfied that Mr Sturrock would have continued working for Richtek Melbourne for a period exceeding the 12 weeks he was unemployed and in a ‘trainee’ role as a result of his unfair dismissal until he obtained permanent work. Based upon Mr Sturrock’s evident work ethic, I see no reason why he would not have remained employed for at least a period of 4 months. There was no satisfactory evidence from the employer to suggest a contrary conclusion.

1. Mr Sturrock’s salary with Richtek Melbourne was $100,000 per annum, plus superannuation.

1. Mr Sturrock seeks compensation on the following basis, confined to a 12-week period ending shortly after 4 March 2024 (which was the date that he completed the trainee period in his new role).

1. On Mr Sturrock’s salary with Richtek Melbourne, he would have received $23,077 before tax for that 12-week period.

1. Owing to Mr Sturrock’s successful endeavours to obtain work, he received approximately $4,769 for the period from 5 February 2024 (noting the lower trainee salary for the period). The difference is $18,307. This is the amount of lost salary incurred by Mr Sturrock due to his unfair dismissal. The actual amount is likely to be higher than this, because I conclude that it is sufficiently likely that Mr Sturrock would have remained employed for a longer period of time, having regard to the length of time Mr Sturrock had been employed for and his work ethic. As Mr Sturrock’s claim is confined to a 12-week period, it is unnecessary to consider any fine differences in calculations beyond the 12-week period.

1. Similarly, given the period of compensation sought is confined to a 12-week period, the only deduction I consider appropriate for that period is the amount Mr Sturrock actually earned elsewhere. The evidence strongly demonstrated that Mr Sturrock was actively seeking work and there is no basis to discount the amount of compensation beyond that which he actually earned.

1. While I was initially concerned about the financial viability of Ricktek Melbourne, there was ultimately no material before me that would satisfy me that any further deduction is appropriate, other than taxation.

Order

1. I will make an order that Mr Sturrock be paid $18,307 (less applicable tax) within 14 days of this decision. An Order[2] will be published together with this decision. I note that Mr Sturrock’s contract of employment defines “the Remuneration” as an annual salary “per year plus superannuation”. While my order does not include an amount for superannuation, any superannuation payable must also be made.

DEPUTY PRESIDENT

Appearances:

M Kriewaldt of Jewell Hancock Employment Lawyers, for the Applicant
No appearance for the Respondent

Hearing details:

2024.
Melbourne (by video link via Microsoft Teams):
April 16.

[1] Treleani v Richtek Melbourne Pty Ltd[2023] FWC 3279.

[2] PR776573

Printed by authority of the Commonwealth Government Printer

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