Sarah Humphries v Sarah Watkin Wellness and Massage Therapy
[2022] FWC 259
| [2022] FWC 259 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Sarah Humphries
v
Sarah Watkin Wellness and Massage Therapy
(U2021/7252)
| DEPUTY PRESIDENT DEAN | CANBERRA, 7 MARCH 2022 |
Application for an unfair dismissal remedy –dismissal consistent with Small Business Fair Dismissal Code - application dismissed.
Ms Sarah Humphries has made an application for an unfair dismissal remedy pursuant to s.394 of the Fair Work Act 2009. She claims that she had been unfairly dismissed by Sarah Watkin Wellness and Massage Therapy (W Wellness).
W Wellness argues that Ms Humphries was not unfairly dismissed because her dismissal was consistent with the Small Business Fair Dismissal Code (the Code).
The application was heard by video on 10 and 25 November 2021. At the hearing Ms Connie Park appeared with permission for Ms Humphries, and Mr Ben Game appeared with permission for W Wellness. Final written submissions and a reply were filed after the hearing and the last of which was received on 16 December 2021.
Fourteen people in total gave evidence, and much of this evidence was of little, if any, assistance in deciding this matter. Only the matters relevant to what the Commission needs to determine is referenced in this decision.
For the reasons set out below, I find that Ms Humphries’ dismissal was consistent with the Code and accordingly her application is dismissed.
Events leading to the termination of Ms Humphries’s employment
Ms Humphries, who is a citizen of the United Kingdom, was initially engaged in March 2019 as a contractor to perform massages to customers of W Wellness. As a result of changes to the visa status of her husband, she had a conversation with Ms Watkin, the owner of W Wellness, who agreed to sponsor her for a Regional Sponsored Migration Scheme visa. Following this agreement, she signed an employment contract as a full-time massage therapist commencing on 12 August 2019.
On 22 November 2019 Ms Humphries was notified that her visa application had been refused. She lodged an appeal with the Administrative Appeals Tribunal on 17 December 2019. She continued to work while waiting for her appeal to be heard.
She was summarily dismissed on 26 July 2021 and the letter of termination outlined the grounds for the dismissal as follows:
“a)refused to work the thirty-eight (38) hours of work per week stipulated by your contract, nor the alternatives offered by your employer;
b)failed or refused to maintain records in the Setmore system as directed to by your employer on numerous occasions;
c)unlawfully removed confidential information from your employer's computer systems without authorisation; and
d)approached current members of staff to seek adverse information about Mrs Watkin.”
Each of the four matters provided as the reasons for the dismissal are dealt with below.
Work hours
Ms Watkin’s evidence was that Ms Humphries had never worked the required full-time hours throughout her employment. She said that Ms Humphries, for a variety of reasons, was unable to work her full-time hours when her employment first began, including because of school holidays and subsequently deciding to home school her children. She said she agreed to continue to pay Ms Humphries on a full-time basis and Ms Humphries undertook to make up the hours later, which never eventuated.
Ms Watkin gave evidence that in late May 2020 she again raised with Ms Humphries that Ms Humphries was not able to work during business hours and was not working full time hours. She said that Ms Humphries’ response was that she could not afford to send her children to school and could not work more hours at the time.
Ms Watkin said that she next met with Ms Humphries on 24 September 2020 and raised a number of performance issues with her. She said Ms Humphries “rejected all suggestions, refused to rectify, or change her working hours and any offer of alternative working arrangements including taking some of the time owed to attend the laundry mat to wash towels.”
Ms Watkin became ill in April 2021 and was hospitalised. She relayed a conversation she said took place between Ms Humphries and her on 24 April 2021 during which she told Ms Humphries that she needed her to start making up some of the time Ms Humphries owed her as her surgery was scheduled for June and she would be unable to work for 8 weeks post surgery. Ms Watkin reminded Ms Humphries of the need to work her full time hours and the need to make up some of the time she owed. The response from Ms Humphries was to the effect that she could not work any more hours, but she would try when she could get her children back to school the following term.
Ms Humphries said in her witness statement that she worked in the clinic for approximately 30 hours per week and the remaining 8 hours (to make 38 full time hours) were spent at home drafting client notes and speaking to clients on the phone about their ongoing needs and concerns.
Ms Humphries contended that she did not refuse to work 38 hours per week and maintained that she worked the required hours. During her normal working hours, she mostly had back-to-back appointments and there was no need for her to take lunch breaks as her weekday working hours commenced late in the afternoon. After her last appointment, she stayed back to do washing and other administrative and housekeeping duties.
Ms Humphries argued that if W Wellness was so concerned about her working hours, it could have taken measures to adopt a system to record her working hours. She further submitted that her employment agreement did not specify set working hours, as her hours were variable in line with business demand.
W Wellness contended that Ms Humphries had not objected to the accuracy of the appointment book insofar as it listed her appointments throughout her employment. It contended that Ms Humphries’ assertions as to the time required to discharge her duties in addition to the appointments were exaggerated and uncorroborated by any witness or documentary evidence.
It was submitted that the evidence supported a finding that Ms Humphries would spend between 15 to 30 minutes cleaning, on average, on each working day. When added to the estimate of time for pre-appointment preparation and the actual appointments themselves, this indicated she had around 27.5 hours of clinic time per week.
In terms of writing client notes, W Wellness contended that perhaps five minutes per day was all that was required to complete any necessary notes. This was supported by the evidence of Ms Dowling, a former employee of W Wellness, who attested that around 80% of Ms Humphries’ appointments were repeated clients and did not require any meaningful notetaking. Further, Ms Dowling said she only witnessed notetaking for new clients.
Maintenance of records
It was alleged that Ms Humphries did not comply with lawful directions in relation to record keeping by failing to enter client notes in a computer system known as Setmore used by W Wellness.
There is no dispute that Ms Humphries did not enter the client notes in Setmore. Her evidence was that she stored her handwritten client notes securely at her house and Ms Watkin was fully aware of that and had never raised any issue. She said that she had spoken to Ms Watkin about the problems with keeping client records in Setmore which is a system mainly for bookings, including that many people had access to the system and anyone could change her notes.
Ms Watkin gave evidence that she told Ms Humphries at the meeting on 24 September 2020 that she needed to enter the notes on Setmore. According to her, Ms Humphries made a response to the effect that she kept everything in her head and ‘if we need notes, I can write them’. She then told Ms Humphries that she needed to put the clients notes on Setmore and get it done by using the time owed to her.
Ms Watkin said that she asked Ms Humphries in around April 2021 to bring her notes to the clinic so the receptionist could scan and store the notes in Setmore. She said Ms Humphries refused to do so.
Ms Humphries disputed that she was ever asked to write client notes in the clinic. Further, she was unable to attach documents to Setmore and did not have access to a computer until March 2021 when W Wellness relocated its premises.
In submissions made on behalf of Ms Humphries, it was argued that the Employment Agreement only made reference to the use of Setmore to document appointments and to keep client records in a confidential manner. It did not specify that client records were required to be kept or stored in Setmore. In addition, there was no adequate systems in place on the business premises so that the client records can be kept in a confidential manner.
Removal of confidential information
The purported ‘confidential information’ referred to in the termination letter was an unsent letter drafted by Ms Watkin in May 2021 (the Letter). The Letter, tendered into evidence by W Wellness, reads as follows:
“Dear Sarah
Further to our text massages this morning, I note that you are unhappy with the volume of work and expectation of what I thought was our agreement under your current salaried position here at W Wellness Centre. You are currently employed as a salaried position of $60k per year plus superannuation (this was originally $55k as per the signed contract but I have provided you with a $5k pay increase over this time). Under the current contract, the expectation was that you would be available to work full time – defined as 38 hours per week, to undertake a variety of tasks including but not limited to the Sports Therapy treatments that have become your main role within the period of your employment.
Given your feedback and considering your change of circumstances since commencement, I feel it is probably time to revisit our arrangement and get something more solid and agreed to in writing. Unfortunately, you have been unable to fulfil the requirement of full-time work during the period of employment. While I understand that this is due to circumstances that were unforeseen, you have only been able to average a working week of approximately 30 hours. While I note that you have maintained and grown your client base and that the number of clients you are trying to see within the available times you have allocated to work is amicable, these numbers are not maintainable long term for you or for work health and safety and the times you are working is preventing you from maintaining a good work life balance. I also note that unfortunately there is still eight hours of productivity that the business has not been able to utilize and the other tasks and responsibilities that we first thought possible have been left incomplete.
As you have stated in writing that you are unhappy with the number of clients and the hours that you are working, I would like to propose the following to ensure that we can achieve balance.
Your working hours will change as follows:
Current Proposed Monday 5-9pm Monday – Day off Tuesday 6-9pm Tuesday 4-9pm Wednesday 4-9pm Wednesday 4-9pm Thursday 4-9pm Thursday 4-9pm Friday 6-9pm Friday 4-9pm Saturday 9am-6pm Saturday 9-1pm and 2pm-6pm 29 hours 28 hours
With these hour changes I also wish to formalise the number of treatments in this timeframe to make it more manageable for you as follows:
Tuesday to Friday appointment times 4pm, 5:15pm, 6.30pm and 7.45pm
Saturday appointment times: 9am, 10:30am, 11.45as and 2pm, 3:30pm and 4:45pm
If there is a combined sauna massage treatment, we can still manage to work between two rooms but no more than the above appointment numbers will be booked.
This will be a total of 22 massages per week.
With the change to hours and a reduction in massages, I propose that we change your existing contract from Salaried Full-time to Award Part time work.
With the proposal to move to an Award hourly rate I have considered the MA000027: Health Professionals and Support Services Award 2020 (fwo.gov.au). Taking this into account and after seeking further advise directly from Fair Work your current award is assessed at Health Professional Level 2. As follows:
Health Professional employee—level 2 Pay point 1 30.83 Pay point 2 31.95 Pay point 3 33.17 Pay point 4 34.49
Under this award we are a professional clinic, so we are able to operate within the hours that I have the centre open now as ordinary hours. Also, as your employment hours are at your request as you are unable to work hours in the daytime due to your circumstances, I am permitted to pay you for your shifts under the ordinary hour rate. My offer is to put you on Pay point 3 - $33.17. This equates to $928.76 gross for 28 hours work.
I feel this proposal will see a better work life balance and a more achievable number of treatments that is maintainable. I am open to discuss this with you and negotiate.”
Ms Humphries gave evidence that in around May 2021 she had inadvertently discovered the Letter titled “Letter to Sarah H” from the work computer. She denied having removed the Letter from the computer system and said she had only read it. She added that the Letter was accessible to anyone using the communal computer at the workplace.
Ms Humphries further argued that she accessed the Letter without knowing that it was confidential and a reasonable person in her position would not have viewed the letter as a confidential document. If Ms Watkin wished to ensure that such document was confidential, she could have taken steps to ensure that it was only accessible to herself, such as marking the document ‘confidential’ or saving it in a place where only she could access it.
Ms Watkin gave evidence that she prepared the Letter in late May 2021 and planned to give to Ms Humphries after her surgery if Ms Humphries was unable to commence working 38 hours per week. It was intended to give her the option to work part time with a corresponding change in her salary.
On or around 6 July 2021 Ms Watkin and Ms Humphries met at a café to discuss Ms Watkin’s return to work after surgery. It was not disputed that Ms Humphries told Ms Watkin that she had read the Letter when the two met at this time. Ms Watkin said a conversation to the following effect took place:
“Ms Humphries: I guess you are here to talk about Jack (my son driving for Arlo).
Ms Watkin: No why, what's happening with Jack. I'm here to talk about you working full time when the kids go to school after the holidays.
Ms Humphries: Oh, I thought it was going to be about Jack. I called him this morning. I let him go. He won’t be driving Arlo anymore.
Ms Watkins: Oh, wow. Were you uphappy with him. Last time we talked you said Arlo and he were getting along really well, what has happened.
Ms Humphries: Paul is charging us too much and he is taking a loan repayment at the same time. We don't think it’s fair that we have to pay the loan back.
Ms Watkins: I don't know what you guys agreed about Jack's employment arrangement, but I’ll look into it and find out from Paul. You agreed to pay that loan back by the end of 2019 and its 2021 and you still have not paid it.
Ms Humphries: I know about the letter you are going to send me I have a copy of it and I have sent it to my lawyer. You have been mistreating me at work and I won’t be making any changes to my working arrangements. If you change anything I will get a medical certificate and I won’t work at all. It’s easy enough to do.
Ms Watkins: Oh, how did you get a copy of the letter. I have not sent it to you and I wasn't going to until after this meeting if you were still unable to meet your contract agreement of working fulltime. We both can't keep doing this, it will make it easier on both of us if we change things.
Ms Humphries: I found it on your computer. It was not marked confidential so I took it.
Ms Watkins: That was in my personal email Sarah, that is really breaking my trust and I'm pretty sure against the law. This is misconduct. I'm not happy about this. Maybe 1 need to get some legal advice if you are not going to agree to working fulltime or making a change or sticking to your contract.
Ms Humphries: Yes, I think we need to use lawyers now. I have also spoken to the lawyer about my contract already and also to keep my kids safe from Arlo taking them out of the country. I signed the agreement in August but you didn't start paying my super until November. You have broken the law if you send that letter I will make you pay from August and I will get a medical certificate.
Ms Watkins: I have never broken the law we had an agreement at your request for you to start in November. I have been very flexible and understanding and always put you and your family above my own. When I agreed to do this I wanted to help you. You have and are taking advantage of my kindness.”
On 8 July 2021, Ms Humphries commenced sick leave. A medical certificate was presented which certified Ms Humphries was unfit to work between 8 and 22 July. Ms Humphries said that she was experiencing high levels of anxiety and stress due to the breakdown of her relationship with Ms Watkin.
Ms Humphries said she was fearful of Ms Watkin’s husband and was too scared to attend work as she predominantly worked by herself in the evenings.
On 21 July 2021 Ms Humphries was issued with another medical certificate extending her leave until 20 August 2021.
She was given her termination letter on 26 July 2021.
Sought adverse information about Ms Watkin from other staff members
Ms Watkin believed Ms Humphries was spreading rumours within the small community where the business was located, including that Ms Watkin’s business practices were improper and that Ms Watkin’s husband had threatened to kill Ms Humphries. W Wellness argued that causing serious and imminent risk to the reputation of the business was serious misconduct, justifying immediate dismissal.
Ms Humphries denied attempting to seek adverse information from another employee about Ms Watkin, and alleged it was Ms Watkin who was making disparaging comments to members of the community about her.
Other matters
In the period leading up to Ms Humphries’ dismissal, there is an ongoing dispute between the parties about a loan that was made by Ms Watkin to Ms Humphries which has clearly had a negative impact on the relationship between the parties. In addition, there was further tension caused by the arrangement involving Ms Humphries hiring Ms Watkin’s son to work for her husband as his driver between April and July 2021.
Neither matter, however, is directly relevant to the matters I need to decide.
Was Ms Humphries’s dismissal unfair?
Section 385 of the Act, set out below, defines 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.”
There is no dispute that Ms Humphries was dismissed and her dismissal was a not case of genuine redundancy.
Was Ms Humphries’s dismissal consistent with the Code?
There is no dispute and I am satisfied that W Wellness is a small business employer at the time of Ms Humphries’s dismissal. I will now consider whether Ms Humphries’s dismissal was consistent with the Code.
The Code is set out below:
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.
In the present case, the Code can only apply if Ms Humphries’ conduct was sufficiently serious as to justify immediate dismissal. The is because there is no contention by W Wellness that Ms Humphries was warned of any risk of dismissal, and so ‘Other Dismissal’ does not apply. Further, as is made clear in the termination letter, Ms Humphries was dismissed for serious misconduct which was stated to include “refusing to carry out a lawful and reasonable instruction that is part of your job and theft”.
The Full Bench in Ryman v Thrash Pty Ltd t/a Wisharts Automotive Services[1] (Ryman) held that the ‘Summary Dismissal’ section of the Code applies to dismissal without notice on the ground of serious misconduct as defined by Reg. 1.07 of the Fair Work Regulations 2009:
“1.07 Meaning of serious misconduct
(1)For the definition of serious misconduct in section 12 of the Act, serious misconduct has its ordinary meaning.
(2) For subregulation (1), conduct that is serious misconduct includes both of the following:
(a) wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment;
(b) conduct that causes serious and imminent risk to:(i) the health or safety of a person; or
(ii) the reputation, viability or profitability of the employer’s business.
(3) For subregulation (1), conduct that is serious misconduct includes each of the following:
(a) the employee, in the course of the employee’s employment, engaging in:
(i) theft; or
(ii) fraud; or
(iii) assault;
(b) the employee being intoxicated at work;
(c) the employee refusing to carry out a lawful and reasonable instruction that is consistent with the employee’s contract of employment.
(4) Subregulation (3) does not apply if the employee is able to show that, in the circumstances, the conduct engaged in by the employee was not conduct that made employment in the period of notice unreasonable.
(5) For paragraph (3)(b), an employee is taken to be intoxicated if the employee’s faculties are, by reason of the employee being under the influence of intoxicating liquor or a drug (except a drug administered by, or taken in accordance with the directions of, a person lawfully authorised to administer the drug), so impaired that the employee is unfit to be entrusted with the employee’s duties or with any duty that the employee may be called upon to perform.”
The Full Bench in Ryman further held:
“[41] In summary, drawing on the conclusions stated above and the ratio in Pinawin, we consider that the ‘Summary dismissal’ section of the Code operates in the following way:
(1) If a small business employer has dismissed an employee without notice – that is, with immediate effect - on the ground that the employee has committed serious misconduct that falls within the definition in reg.1.07, then it is necessary for the Commission to consider whether the dismissal was consistent with the ‘Summary dismissal’ section of the Code. All other types of dismissals by small business employers are to be considered under the ‘Other dismissal’ section of the Code.
(2) In assessing whether the ‘Summary dismissal’ section of the Code was complied with, it is necessary to determine first whether the employer genuinely held a belief that the employee’s conduct was sufficiently serious to justify immediate dismissal, and second whether the employer’s belief was, objectively speaking, based on reasonable grounds. Whether the employer has carried out a reasonable investigation into the matter will be relevant to the second element.”[2]
In other words, in deciding whether the conduct of an employee was sufficient to justify immediate dismissal, the Commission does not have to make a finding, on the evidence, whether the conduct occurred. The Commission needs to find whether the employer had a reasonable belief that the conduct of the employee was serious enough to warrant immediate dismissal. It is not necessary for the Commission to determine whether the employer was correct in the belief that it held.
For an employer to believe on reasonable grounds that the conduct of the employee was serious enough to justify immediate dismissal, the employer must establish that they did in fact hold the belief that:
a. the conduct was by the employee
b. the conduct was serious, and
c. the conduct justified immediate dismissal.
The employer must establish that they had reasonable grounds to hold the belief.
Having considered all the evidence and submissions, I find that W Wellness held a reasonable belief that Ms Humphries’ conduct was serious enough to warrant her immediate dismissal, and that she had reasonable grounds to hold this belief.
First, to the extent the evidence of Ms Humphries and Ms Watkin differs, I prefer the evidence of Ms Watkin who had gone to great lengths to assist Ms Humphries, including by agreeing to sponsor her for her visa so she and her family could remain in Australia.
I accept that Ms Humphries did not work her full-time hours, nor did she make herself available to work the hours she was paid for or required to, despite multiple requests by Ms Watkin to do so. It is clear in my view that a more flexible arrangement was initially accepted by Ms Watkin, on the basis that Ms Humphries would make up these hours and further that she would work her full 38 hours within the near future. At the time of her dismissal, Ms Humphries had refused on more than one occasion to make herself available to work 38 hours each week despite the fact that she was paid on that basis throughout her employment.
It was unreasonable for Ms Humphries to have expected that the flexibility she wanted would continue indefinitely. This is even more so given the nature of the business and that she was the only full-time massage therapist other than Ms Watkin.
Further, I accept Ms Humphries had refused to comply with the requests made of her to either put her client notes into Setmore herself, or alternatively bring her notes to the office so the receptionist could scan and store the notes in Setmore. Ms Humphries’ obvious dislike of the Setmore system was no reason to refuse a lawful and reasonable direction in this regard.
In relation to these first two reasons for dismissal, being the refusal to work 38 hours each week and not putting client notes into the computer system, I am satisfied that these matters fall within the definition of serious misconduct that put at risk the viability, the operation and the profitability of the business of W Wellness. I am satisfied that W Wellness held a reasonable belief that Ms Humphries engaged in misconduct warranting her immediate dismissal and it took legal advice from its solicitors before reaching a decision to terminate Ms Humphries’ employment.
However, I am not satisfied that Ms Watkin had reasonable grounds to hold a belief that Ms Humphries engaged in misconduct by approaching current staff to seek adverse information about Mrs Watkin, or that Ms Humphries unlawfully removed confidential information from W Wellness’ computer system without authorisation. The evidence before the Commission does not support such a finding.
If I am wrong as to the dismissal being consistent with the Code, I would have found that the dismissal was not otherwise unfair, in that it was not harsh, unjust or unreasonable. While the procedure followed by W Wellness may not have been ideal, I am satisfied that it had a valid reason to dismiss her based on the findings above, and in particular because Ms Humphries repeatedly refused to make herself available to work 38 hours per week.
Conclusion
I am satisfied that the dismissal of Ms Humphries was consistent with the Code. Accordingly, her application is dismissed.
DEPUTY PRESIDENT
Appearances:
C Park for Sarah Louise Humphries.
B Game for Sarah Watkin Wellness and Massage Therapy.
Hearing details:
2021.
Canberra (By video):
November 10, 25.
[1] [2015] FWCFB 5264.
[2] Ibid at [41].
Printed by authority of the Commonwealth Government Printer
<PR738170>
0
1
0