Schultz v Scanlan and Theodore Pty Ltd
[2013] FCCA 1096
•18 October 2013
FEDERAL CIRCUIT COURT OF AUSTRALIA
| SCHULTZ v SCANLAN & THEODORE PTY LTD | [2013] FCCA 1096 |
| Catchwords: INDUSTRIAL LAW – Claim of adverse action – dismissal – workplace right – entitlement to maternity and sick leave – pregnancy and/or physical disability – allegations of breach of ss.342 and 351 of Fair Work Act 2009 – burden of proof – consideration of s.361 – application dismissed. |
| Legislation: Fair Work Act 2009 (Cth), ss.340, 340(1), 342, 351(1), 360, 361 |
| Fox v Percy (2003) 214 CLR 118 Board of Bendigo Regional Institute of Technical and Further Education v Barclay and Another (2012) 290 ALR 647 General Motors-Holden's Pty Ltd v Bowling (1976) 136 CLR 676 Liquor Hospitality and Miscellaneous Union v Arnotts Biscuits Limited [2010] FCA 770 Jones v Queensland Tertiary Admissions Centre Ltd (No.2) [2010] FCA 399 Qantas Airways Ltd v Australian Licensed Aircraft Engineers Association (2012) 202 FCR 244 Patrick Stevedores Operations (No.2) Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 United Firefighters Union of Australia v Easy [2013] FCA 763 Automotive, Food, Metals, Engineering Printing and Kindred Industries Union v Visy Packaging Pty Ltd (No.3) [2013] FCA 525 National Tertiary Education Union v Royal Melbourne Institute of Technology [2013] FCA 451 Ramos v Good Samaritan Industries [2013] FCA 30 Jones v Department of Energy and Minerals (1995) 60 IR 304 |
| Applicant: | MONICA SCHULTZ |
| Respondent: | SCANLAN & THEODORE PTY LTD |
| File Number: | MLG 1155 of 2012 |
| Judgment of: | Judge O’Sullivan |
| Hearing dates: | 18, 19 & 20 September 2013 |
| Date of Last Submission: | 20 September 2013 |
| Delivered at: | Melbourne |
| Delivered on: | 18 October 2013 |
REPRESENTATION
| Counsel for the Applicant: | Mr J. McKenna |
| Solicitors for the Applicant: | Wisewould Mahony Lawyers |
| Counsel for the Respondent: | Mr M. Felman |
| Solicitors for the Respondent: | Minter Ellison Lawyers |
ORDERS
The application be dismissed.
Any application, affidavit and written submissions in relation to costs be filed and served within 14 days.
Any response, affidavit and written submissions in reply be filed and served 14 days thereafter.
AND THE COURT NOTES:
Any application for costs will be determined on the papers unless otherwise requested in submissions.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT MELBOURNE |
MLG 1155 of 2012
| MONICA SCHULTZ |
Applicant
And
| SCANLAN & THEODORE PTY LTD |
Respondent
REASONS FOR JUDGMENT
Monica Schultz (“the applicant”) was employed by Scanlan & Theodore Pty Ltd (“the respondent”) between November 2010 and July 2012. The respondent carries on a business as a women’s fashion designer and retailer. The respondent has a number of retail outlets and a head office in South Yarra, Melbourne.
Between November 2010 and September 2011 the applicant was employed by the respondent as a Merchandising Assistant based at the head office. Subsequently, the applicant was promoted to the position of Merchandising Manager with the respondent also located at the head office.
In March 2012, the applicant informed the respondent that she was pregnant. In April 2012 the applicant advised the respondent she would be taking maternity leave later that year. The applicant was absent from work on sick leave in June 2012 but returned to work after only a few days off.
In July 2012, and before the applicant could make a formal application for maternity leave, the respondent advised the applicant that her employment was being terminated due to redundancy.
After having made an application to Fair Work Australia[1] (now the Fair Work Commission) and obtained the necessary certificate,[2] the applicant commenced proceedings in this Court in September 2012. The applicant contended that the respondent has contravened ss.340 and 351 of the Fair Work Act2009 (Cth) (“the FW Act”). If established, the alleged contraventions of ss.340 and 351 of the FW Act by the respondent amount to adverse action against the applicant. The applicant sought by way of remedy inter alia compensation and that a pecuniary penalty be imposed on the respondent.
[1] Attachment [KH3] to affidavit of Ms Hussain filed 20 June 2013 marked exhibit R5
[2] s.369 certificate dated 3 September 2012.
The respondent denied the allegations made by the applicant and contended that there was no basis for any and all of the applicant’s claims. The respondent said that the application should be dismissed.
History of Proceedings
The application was filed on 17 September 2012 and given a first return date of 7 November 2012. However before then, on 30 October 2012, orders were made by consent for the filing of material by both parties, referring the matter for mediation and adjourning the matter to a directions hearing on 1 March 2013.
The applicant then filed a statement of claim on 28 November 2012. The respondent filed a defence on 19 December 2012.
The matter returned to Court on 1 March 2013 for a directions hearing, after the parties had attended mediation, and the following orders were made:
“1.The trial shall proceed on affidavit evidence with the affidavits of each witness if adopted to stand as the evidence in chief of the witness.
2.The Applicant file and serve any affidavit material and any documents upon which she intends to rely at final hearing on or before 20 May 2013.
3.The Respondent file and serve any affidavit material and any documents on which it intends to rely at final hearing on or before 20 June 2013.
4.The Applicant have until 22 July 2013 to file any further affidavit material in reply.
5.The Applicant shall file and serve an outline of submissions addressing the relevant statutory considerations by 12 August 2013.
6.The Respondent shall file and serve an outline of submissions addressing the relevant statutory considerations by 26 August 2013.
7.The parties shall exchange lists of objections to affidavits and grounds of objections by 9 September 2013 with copies to be sent to the Associate to Federal Magistrate O’Sullivan at associate.fmo’[email protected].
8.The parties shall file court book(s) by not later than 16 September 2013.
9.The proceeding be listed for trial in the Federal Magistrates Court at Melbourne at 10:00am on 19 September 2013 with an estimated hearing time of 2 days.
…. ”
On 9 August 2013 orders were made providing for the trial to commence on 18 September 2013.
At the trial the applicant was represented by Mr McKenna of Counsel and the respondent by Mr Felman of Counsel. Counsel resolved most of the objections to the affidavit material by consent or on the basis that the other party either had notice of the evidence, had been given an explanation for late filing and/or leave to lead viva voce evidence in reply. Similarly and as it was admitted there was no prejudice to the applicant the respondent was given leave to file an amended defence at the start of the trial (subject to any application for costs).
Material relied upon
At trial the Court was told the applicant relied on:
a)the application filed 17 September 2012;
b)the statement of claim filed 28 November 2012;
c)her affidavit filed 20 May 2013 – (exhibit A1);
d)her affidavit filed 22 July 2013 – (exhibit A2);
e)written submissions filed 12 August 2013 – (exhibit A4); and
f)the exhibits tendered during the trial on her behalf.[3]
[3] see exhibits A1, A2 and A3
At trial the Court was told the respondent relied on:
a)the amended defence filed 18 September 2013;
b)the affidavit of Mr Besim filed 21 June 2013 – (exhibit R2);
c)the supplementary affidavit of Mr Besim filed 26 August 2013 (exhibit R3);
d)the affidavit of Mr Theodore filed 26 August 2013 – (exhibit R4);
e)the affidavit of Ms Hussain filed 20 June 2013 – (exhibit R5);
f)the affidavit of Ms Ratcliffe filed 20 June 2013 – (exhibit R6);
g)the affidavit of Ms Armstrong filed 20 June 2013 – (exhibit R7);
h)the affidavit of Ms Sawan filed 20 June 2013 – (exhibit R8);
i)the written submissions filed 26 August 2013;
j)the closing submissions marked as exhibit R9; and
k)the exhibits tendered during the course of the trial.[4]
[4] see exhibits R1 to R10
The applicant’s case
The applicant contended that the respondent took adverse action against her because inter alia she proposed to exercise a workplace right to maternity leave or for a prohibited reason.
In her statement of claim filed 28 November 2012 the applicant had claimed inter alia that:
“ …
12.In the 20 April meeting, Mr Besim pressured the applicant to commit to limiting her period of unpaid parental leave to
6 months (pressure to commit to 6 months’ parental leave).
PARTICULARS
During the 20 April meeting Mr Besim repeatedly said to the applicant words to the effect that she would be away for a period of 6 months.
13.The pressure to commit to 6 months’ parental leave amounted to adverse action against the applicant within the meaning of the FW Act.
PARTICULARS
In applying pressure to commit to 6 months’ parental leave, Mr Besim:
i.Altered the applicant’s position to her prejudice; and
ii.Discriminated between the applicant and other employees of the respondent.
14.In breach of s 351, Mr Besim applied pressure to commit to 6 months’ parental leave because of, or for reasons including the applicant’s pregnancy.
… ”
The applicant had also claimed in her statement of claim filed
28 November 2012 that:
“18. On or about 25 June 2012 the applicant:
a.Was unwell;
b.Attended her General Practitioner, Dr Ivor Green; and
c.Was advised by her General Practitioner to remain away from work for 2 days.
19. Later on or about 25 June 2012 the applicant:
a.Injured her back;
b.Attended a health practitioner;
PARTICULARS
The health practitioner was Mr Joshua Ongso, Physiotherapist.
c.Was advised by her health practitioner to have at least 3 days of rest at home; and
d.After consulting her health practitioner, advised Ms Hussain that she had injured her back and would be unable to attend work for a number of days.
PARTICULARS
The applicant advised Ms Hussain of her inability to attend work orally, by telephone at around 7.00pm.
20. On or about 26 June 2012 the applicant:
a.Provided to Mr Besim and Ms Hussain a copy of correspondence from her treating health practitioner; and
b.Advised Mr Besim and Ms Hussain that:
i. She would be unable to attend work for a number of days due to her injured back; and
ii. Due to her pregnancy, she was unable to take any anti-inflammatory medication to ease the swelling/ discomfort.
PARTICULARS
The applicant provided the correspondence and advice to Mr Besim and Ms Hussain by email dated 26 June 2012 at 1.28 pm, attaching correspondence from Joshua Ongso, Physiotherapist. Copies of this email and attachment are in the possession of the applicant’s solicitors and may be inspected by prior appointment.
21.On or about 29 June 2012 the applicant returned to work.
22.The applicant’s absence from work between 25 and 28 June 2012 occurred by reason of a physical disability within the meaning of s 351 of the FW Act.
23.The applicant’s absence from work between 25 and 28 June 2012 occurred because of her pregnancy.
24.Further and in the alternative to paragraph 23 herein, the respondent perceived the applicant’s absence from work between 25 and 28 June 2012 to be because of her pregnancy.
Treatment of the applicant after her return to work
25.Following the applicant’s return to work on or about
29 June 2012:
a.Ms Hussain became hostile towards the applicant; and
PARTICULARS
Ms Hussain’s hostility towards the applicant included Ms Hussain ignoring and failing to acknowledge the applicant’s contributions to subsequent department meetings, refusing to make eye contact with the applicant and otherwise preventing the applicant from contributing to discussions.
b.Mr Besim treated the applicant differently and unfavourably.
PARTICULARS
Mr Besim’s different and unfavourable treatment of the applicant included his refusal to deal directly with the applicant, providing instructions to the applicant indirectly through Ms Hussain including directions relating to PR purchases and promotional and gift vouchers.
26.Ms Hussain’s hostile treatment of the applicant amounted to adverse action against the applicant within the meaning of s 342 the FW Act.
PARTICULARS
Ms Hussain’s hostile treatment:
i. Altered the applicant’s position to her prejudice; and
ii. Discriminated between the applicant and other employees of the respondent.
27.Mr Besim’s different and unfavourable treatment of the applicant amounted to adverse action against the applicant within the meaning of s 342 the FW Act.
PARTICULARS
Mr Besim’s different and unfavourable treatment:
i. Altered the applicant’s position to her prejudice; and
ii. Discriminated between the applicant and other employees of the respondent.
28.In breach of s 351, Ms Hussain’s hostile treatment of the applicant occurred because of, or for reasons including the applicant’s:
a. Pregnancy; and
b. Physical disability.
29.In breach of s 340 of the FW Act, Ms Hussain’s hostile treatment of the applicant occurred because of, or for reasons including the applicant’s refusal to commit to 6 months’ parental leave.
30.In breach of s 351, Mr Besim’s different and unfavourable treatment of the applicant occurred because of, or for reasons including the applicant’s:
a.Pregnancy; and
b.Physical disability.
31.In breach of s 340 of the FW Act, Mr Besim’s different and unfavourable treatment of the applicant occurred because of, or for reasons including the applicant’s refusal to commit to 6 months’ parental leave.”
The applicant also claimed in her statement of claim filed
28 November 2012 that:
36.On or about 10 July 2012 at around 3.30pm, Mr Besim invited the applicant to attend a meeting with him in his office at 4.45 pm.
PARTICULARS
Mr Besim conveyed the invitation to the applicant orally, by telephone.
37. On or about 10 July 2012 at around 4.45pm, the applicant attended a meeting with Mr Besim and Ms Armstrong (10 July meeting).
PARTICULARS
The applicant attended Mr Besim’s office and was subsequently taken to the respondent’s board room at 24-30 River Street, South Yarra.
38. The applicant took with her to the 10 July meeting three copies of her completed application for parental leave.
39.The applicant intended to provide Mr Besim, Ms Hussain and Ms Armstrong with her application for parental leave in the 10 July meeting.
40.By intending to provide Mr Besim, Ms Hussain and Ms Armstrong with her application for parental leave, the applicant:
a.Was entitled to the benefit of unpaid parental leave under the FW Act;
b.Proposed to exercise a workplace right to the benefit of unpaid parental leave under the FW Act;
PARTICULARS
The applicant was entitled to 12 months unpaid parental leave in accordance with Part 2-2, Part 5 of the FW Act.
c.Proposed to make a complaint or enquiry in relation to her employment.
41.At the 10 July meeting Mr Besim and Ms Hussain knew that the applicant proposed to exercise a workplace right the benefit of unpaid parental leave under the FW Act.
42.In the 10 July meeting the respondent terminated the applicant’s employment (termination).
PARTICULARS
The termination was effected by Mr Besim saying to the applicant words to the effect that “this meeting is to inform you that your role has been made redundant”.
43.The termination amounted to adverse action against the applicant within the meaning of s 342 of the FW Act.
44.In breach of s 351 of the FW Act, the respondent terminated the applicant because of, or for reasons including the applicant’s pregnancy.
45.In breach of s 340 of the FW Act, the respondent terminated the applicant because, or for reasons including that:
a.The applicant had a workplace right to unpaid parental leave;
b.The applicant refused to commit to 6 months’ parental leave;
c.The applicant had exercised a workplace right to request parental leave;
d.The applicant proposed to exercise a workplace right to request parental leave; and/or
e.To prevent the applicant from exercise a workplace right to request parental leave.”
The respondent’s case
The respondent denied the allegations made by the applicant.
The respondent’s case was to deny that there had been adverse action and (in relation to the applicant’s termination) to the extent that there had been adverse action taken it was not for a prohibited reason within the meaning of ss.340 and 351 of the FW Act.
In its amended defence the respondent’s position in relation to the applicant’s claims referred to at paragraph [15] above was:
“12.It denies the allegations in paragraph 12 and says further that Mr Besim did not speak to the Applicant about the duration of her proposed parental leave during the meeting on 20 April 2012 nor at any stage during the Applicant’s employment.
13.It denies the allegations in paragraph 13 and says further that:
(a)it refers to and repeats paragraph 12 above; and
(b)to the extent that there was pressure on the Applicant to commit to a period of maternity leave (which is denied), such conduct would not amount to adverse action as alleged in paragraph 13 within the meaning of that term in s.342(1) of the Fair Work Act 2009 (Cth) (FW Act).
14.It denies the allegations in paragraph 14 and refers to and repeats paragraph 12 above.”
In its amended defence the respondent’s position in relation to the applicant’s claims referred to at paragraph [16] above was:
“22.It denies paragraph 22 and says further that, to the extent that the Applicant was absent from work from 26 to 28 June 2012 by reason of injuring her back, the Applicant’s back injury in the circumstances did not amount to a physical disability for the purposes of s.351 of the FW Act.
23.It does not admit paragraph 23 and says further that, to the extent that the Applicant was absent from work from 26 to 28 June 2012 by reason of injuring her back, this was not an absence by reason of “pregnancy” for the purposes of s.351 of the FW Act.
24.It denies the allegations in paragraph 24 and says further that the Respondent believed the Applicant's absence from work was because of a back injury.
25.It denies the allegations in paragraph 25.
26.It denies the allegations in paragraph 26 and refers to and repeats paragraph 25 above.
27.It denies the allegations in paragraph 27 and refers to and repeats paragraph 25 above.
28.It denies the allegations in paragraph 28 and refers to and repeats paragraph 25 above.
29.It denies the allegations in paragraph 29 and refers to and repeats paragraph 25 above.
30.It denies the allegations in paragraph 30 and refers to and repeats paragraph 25 above.
31.It denies the allegations in paragraph 31 and refers to and repeats paragraph 25 above.
32.It denies the allegations in paragraph 32.”
In its amended defence (highlighting changes from the defence filed in December 2012) the respondent’s position in relation to the applicant’s claims referred to at paragraph [17] above was:
“36. It admits paragraph 36 and says further that:
(a)as at the beginning of 2012, the Respondent’s business had experienced a significant downturn in sales in the past three years;
Particulars
In 2009, the Respondent's
profit fromannual saleswaswere down1026% when compared with the previous calendar year. In 2010 and 2011, theRespondent's profit from sales decreased by a further 1% each yearsales figures increased, however the annual sales figures for 2011 were still much lower than the figures obtained in 2008. As at 30 June 2012, the Respondent'sprofit fromsaleswaswere down a further 10% (when compared with the first six months of 2011).(b)by reason of the poor sales performance of the Respondent described in paragraph 36(a) above, the Respondent was required to cut costs, including by reducing the number of staff working for the Respondent;
(c)by reason of the above, the following positions were made redundant by the Respondent in 2012:
i. the position of Sample Machinist in January 2012;
ii. the position of Work Room Manager in March 2012; and
iii. the position of Quality Control Manager in April 2012.
(d)further, by reason of the above, employees in the following positions with the Respondent had, in 2012, resigned from the Respondent and were not replaced:
i.the position of Pattern Maker in January 2012; and
ii.the position of Raw Materials Warehouse Manager in July 2012.
(e)on 6 July 2012, the Respondent conducted a meeting in the warehouse operated by the Respondent;
Particulars
There were seven attendees at this meeting, including Sener Besim (General Manager), Khatijah Hussain (Planning Manager) and the Applicant.
(f)during the meeting on 6 July 2012, Mr Besim discussed the fact that the Respondent’s business’ sales were declining in circumstances where the Respondent had budgeted for a growth in sales and, as a result, there was a greater demand within the Respondent’s business for less full time employees and that there would be more redundancies in the future;
(g)it was also discussed in the meeting on 6 July 2012 that the Raw Materials Warehouse Manager had just resigned and Mr Besim informed the Respondent’s staff present at the meeting that the Raw Materials Warehouse Manager’s position would not be replaced and that there would need to be adjustments to everyone’s workload as required; and
(h)in or around 9 July 2012, Mr Besim decided to make the Merchandise Manager position redundant. This position was selected for redundancy as the duties of this position were able to be performed by other staff, therefore enabling the Respondent to further reduce staffing costs.
37.It admits paragraph 37.
38.Save that at the meeting on 10 July 2012 the Applicant attempted to provide to the Respondent a copy of her parental leave application and the Respondent did not accept the application, it does not admit paragraph 38.
39.It cannot plead to paragraph 39 as the paragraph contains no allegations against it.
40.Save that the Respondent admits that the Applicant was eligible to take unpaid parental leave under the FW Act, it denies the allegations in paragraph 40 and says further that:
(a)an unstated intention to provide an employer with an application for parental leave does not of itself amount to the entitlement to the benefit of unpaid parental leave under the FW Act; and
(b)proposing to exercise a workplace right of unpaid parental leave does not amount to a complaint or enquiry for the purposes of s.341(1)(c) of the FW Act.
41.Save that the Respondent admits that as at 10 July 2011, the Respondent knew that the Applicant would at some point exercise a workplace right to the benefit of unpaid parental leave, it otherwise denies the allegations in paragraph 41 and says further that:
(a)it was not aware of the details of what the parental leave application would be, such as how long the Applicant intended to take for parental leave;
(b)it requested that the Applicant attend the meeting for the purpose of discussing the termination of her employment; and
(c)it did not know that the Applicant was proposing to submit a parental leave application during the 10 July 2012 meeting.
42. It admits paragraph 42 and says further that:
(a)the Applicant’s employment was terminated by reason of redundancy;
Particulars
The Applicant refers to paragraphs 36 to 41 and the particulars thereunder.
(b)the Applicant’s employment was not terminated for a reason, or reasons that included a reason, of the Applicant’s pregnancy, any of the Applicant’s parental leave entitlements or refusing to commit to a particular period of parental leave;
(c)following the termination of the Applicant’s employment by reason of redundancy, the duties of the Merchandise Manager were subsequently performed by Ms Hussain and Ms Ratcliffe; and
(d)following the termination of the Applicant’s employment by reason of redundancy, the Applicant was provided with four weeks of severance pay.
43.It denies the allegations in paragraph 43 and says further that:
(a)it refers to and repeats paragraphs 36 to 42 above and the particulars thereunder; and
(b)the Respondent is supportive of its employees taking maternity leave and returning to work and since 2009 has had a number of employees successfully return from maternity leave.
Particulars
(i) Ms Michelle Theodore (Retail Store Manager) went on maternity leave in August 2008 and successfully returned to work in February 2009;
(ii) Ms Lina Morales (Retail Sales) went on maternity leave in October 2009 and successfully returned to work in
Februaryaround May 2010;(iii) Ms Therese Feltham (Pattern Maker, Head Office) went on maternity leave in July 2009 and successfully returned to work in February 2010;
(iv) Ms Christine Virgiotis (Retail Sales) went on maternity leave in July 2011 and successfully returned to work in March 2012;
(v) Ms Theodore went on maternity leave for the second time in August 2011 and successfully returned to work in February 2012;
(vi) Ms Natalie Edel (Retail Sales) went on maternity leave in September 2011 and successfully returned to work in May 2012;
(vii) Ms Ratcliffe went on maternity leave in October 2011 and successfully returned to work in May 2012;
(viii) Ms Morales went on maternity leave for the second time in April 2012 and
is still currently on maternity leavereturned to work in January 2013; and(ix) Ms Feltham went on maternity leave for the second time in September 2012 and has expressed an intention to return to work in September 2013.
44.It denies the allegations in paragraph 44 and refers to and repeats the allegations in paragraphs 36 to 43 above and the particulars thereunder.
45.It denies the allegations in paragraph 45 and refers to and repeats the allegations in paragraphs 36 to 43 above and the particulars thereunder.” (emphasis in original)
The allegations of adverse action
At the commencement of the trial, Counsel for both parties agreed there were 4 different allegations of adverse action. These were referred to in respondent’s outline of submissions filed on 26 August 2013 as follows:
“(a) The Respondent engaged in adverse action against the Applicant by Mr Sener Besim (Besim), the Respondent’s General Manager, pressuring the Applicant to commit to six months of parental leave, such action engaged in by reason that the Applicant was pregnant (in breach of s.351 of the FW Act) (Allegation 1);
(b) The Respondent engaged in adverse action against the Applicant in that Khatijah Hussain (Hussain), the Respondent’s Planning Manager and the Applicant’s direct manager, treated the Applicant with hostility by reason of:
(i) the Applicant’s pregnancy and physical disability (in breach of s.351 of the FW Act); and/or
(ii) the Applicant’s refusal to commit to six months of parental leave (in breach of s.340 of the FW Act);
(Allegation 2)
(c) That the Respondent engaged in adverse action against the Applicant in that Besim treated the Applicant differently and unfavourably by reason of:
(i) the Applicant’s pregnancy and physical disability (in breach of s.351 of the FW Act); and/or
(ii) the Applicant’s refusal to commit to six months of parental leave (in breach of s.340 of the FW Act); and
(Allegation 3)
(d)That the Respondent engaged in adverse action against the Applicant by terminating her employment by reason of:
(i) her pregnancy (in breach of s.351 of the FW Act); and/or
(ii) the Applicant:
A. having a workplace right to unpaid parental leave;
B. refusing to commit to six months of parental leave;
C. exercising a workplace right to request parental leave;
D. proposing to exercise a workplace right to request parental leave; and/or
E. preventing the Applicant from exercising a workplace right to request parental leave –
in breach of s.340 of the FW Act. (Allegation 4)”
Given the agreement of the parties referred to above it is convenient for the purposes of these reasons to consider the evidence of the parties and the submissions made on their behalf in the context of the identified, and separate allegations of adverse action as outlined above.
The legislation
Section 340 of the FW Act states:
“(1)A person must not take adverse action against another person:
(a) because the other person:
(i) has a workplace right; or
(ii) has, or has not, exercised a workplace right; or
(iii) proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or
(b)to prevent the exercise of a workplace right by the other person.”
For the purposes of s.340(1) of the FW Act, the term ‘workplace right’ is defined in s.341(1) of the FW Act:
“Meaning of workplace right
(1) A person has a workplace right if the person:
(a)is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or
(b) is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or
(c)is able to make a complaint or inquiry:
(i) to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
(ii) if the person is an employee—in relation to his or her employment.”
For the purposes of both ss.340(1) and 351(1) of the FW Act, the circumstances in which “adverse action” is taken by an employer against an employee is set out in s.342(1) at Item 1 as follows:
“(1)The following table sets out circumstances in which a person takes adverse action against another person.
Meaning of adverse action Item Column 1
Adverse action is taken by ...Column 2
if ...1 an employer against an employee the employer:
(a) dismisses the employee; or
(b) injures the employee in his or her employment; or
(c) alters the position of the employee to the employee's prejudice; or
(d) discriminates between the employee and other employees of the employer.
2 a prospective employer against a prospective employee the prospective employer:
(a) refuses to employ the prospective employee; or
(b) discriminates against the prospective employee in the terms or conditions on which the prospective employer offers to employ the prospective employee.
3 a person (the principal ) who has entered into a contract for services with an independent contractor against the independent contractor, or a person employed or engaged by the independent contractor the principal:
(a) terminates the contract; or
(b) injures the independent contractor in relation to the terms and conditions of the contract; or
(c) alters the position of the independent contractor to the independent contractor's prejudice; or
(d) refuses to make use of, or agree to make use of, services offered by the independent contractor; or
(e) refuses to supply, or agree to supply, goods or services to the independent contractor.
4 a person (the principal ) proposing to enter into a contract for services with an independent contractor against the independent contractor, or a person employed or engaged by the independent contractor the principal:
(a) refuses to engage the independent contractor; or
(b) discriminates against the independent contractor in the terms or conditions on which the principal offers to engage the independent contractor; or
(c) refuses to make use of, or agree to make use of, services offered by the independent contractor; or
(d) refuses to supply, or agree to supply, goods or services to the independent contractor.
5 an employee against his or her employer the employee:
(a) ceases work in the service of the employer; or
(b) takes industrial action against the employer.
6 an independent contractor against a person who has entered into a contract for services with the independent contractor the independent contractor:
(a) ceases work under the contract; or
(b) takes industrial action against the person.
7 an industrial association, or an officer or member of an industrial association, against a person the industrial association, or the officer or member of the industrial association:
(a) organises or takes industrial action against the person; or
(b) takes action that has the effect, directly or indirectly, of prejudicing the person in the person's employment or prospective employment; or
(c) if the person is an independent contractor--takes action that has the effect, directly or indirectly, of prejudicing the independent contractor in relation to a contract for services; or
(d) if the person is a member of the association--imposes a penalty, forfeiture or disability of any kind on the member (other than in relation to money legally owed to the association by the member).
In summary an employer can take adverse action against an employee by dismissing the employee, or by injuring the employee in his or her employment, or by altering the position of the employee to the employee’s prejudice, or by discriminating between the employee and other employees of the employer.
Section 351 of the FW Act states:
“An employer must not take adverse action against a person who is an employee, or prospective employee, of the employer because of the person's race, colour, sex, sexual preference, age, physical or mental disability, marital status, family or carer's responsibilities, pregnancy, religion, political opinion, national extraction or social origin.”
The FW Act provides that once an applicant has established either that they have a workplace right or an attribute covered by s.351(1) of the FW Act and that they have been subject to adverse action section 361 of the FW Act operates to reverse the normal onus of proof. Section 361 provides:
“(1)If:
(a)in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and
(b)taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed, in proceedings arising from the application, that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
(2)Subsection (1) does not apply in relation to orders for an interim injunction.”
By virtue of s.360 of the FW Act a person takes action for a particular reason if the reasons for the action include that reason.
Evidence
Applicant’s evidence
In her affidavit filed 20 May 2013, the applicant had deposed:
“2.I am 30 years old. I was married in June 2009. Prior to my employment with the respondent (Scanlan & Theodore) I had worked in a variety of roles, including work in fashion and retail, as well as teaching and tutoring English both in Australia and in Japan.
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5.During my employment as Merchandise Manager with Scanlan & Theodore my direct manager was Khatijah Hussain (Khatijah), the Planning Manager. I reported directly to Khatijah in regards to stock management including - allocations, inventory, stock processing, transfers, product recalls, consolidations, barcodes, stock maintenance of in-house branches and seasonal stock takes. Other areas of my responsibility which were directly overseen by Khatijah included:
a.managing the Merchandise department projects and tasks;
b.processing Head Office staff purchases;
c.processing David Jones daily exception reports for sales reconciliations,
d.permanent markdown processing,
e.programming staff and sales discounts;
f.answering store queries in regards to stock and inventory;
g.maintaining client and VIP client databases;
h.text messaging clients for promotional events; and
i.processing accessories footwear and offshore garments ready for dispatch.
6.My other key responsibilities as Merchandise Manager, which were not specifically overseen by Khatijah included - creating staff system IDs and extending customer gift vouchers and credit notes.
7.The General Manager, Sener Besim (Sener) directly oversaw my responsibilities connected to promotional vouchers, P.R. purchases, staff clothing allowances and all associated reporting. At the start of each month I would provide Sener with an updated report of the Promotional Vouchers and P.R. purchases issued and approved from the previous month. Khatijah did not regularly receive or have input in these reports.
8.Robyn Armstrong (Robyn) is one of Scanlan & Theodore’s Account Managers. As the Merchandise Manager, I emailed her at the start of each week with my team’s working hours from the previous week. On a more sporadic basis, I was in contact with her in regards to stationery needs, pay slips and staff purchases made with cash.
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12.During my employment with Scanlan & Theodore I observed that employees would often come to work when they were unwell. It was common for whole departments to be sick with the same cold or flu, yet they would all continue to work and try to perform their roles. In the final 6 months of my employment I noticed an increase in this type of behaviour. I observed an increased culture of martyrdom and intolerance to absences. Senior management was part of this culture. Khatijah often came into work while seemingly
veryill. On the occasions I asked why she didn’t take a day off and stay at home, she would reply with words to the effect, “I can’t. I have to be here.” When I required a day of sick leave and had to inform Khatijah, I always did so with a lot of trepidation because my news was often met with a distinct lack of sympathy and usually irritation or annoyance. I felt that the examples set by management, the lack of empathy, and the judgement levelled at employees who took sick days, made it really difficult to stay at home.…
Short term Merchandise Manager role
17.Around late April to early May 2011 Jen announced that she was pregnant and was due in late October. She went on maternity leave on or about 10 October 2011 and I understand that she gave birth on or about 28 October 2011.
18.Around June to July 2011 I became aware through a conversation with Jen that I was expected to cover her role whilst she was on maternity leave. It was made clear to me on several occasions by Jen, Khatijah and Sener that the role was only ever temporary.
19.I continued to work in the role of Merchandise Assistant until October 2011. In October 2011 I was promoted to the role of Merchandise Manager to cover Jen’s period of maternity leave. Around this time I was promised a new Employment Agreement by Khatijah, which would set out the terms and conditions of my new role as Merchandise Manager. I cannot remember receiving this Employment Agreement and I have not been able to find a copy of this October 2011 Employment Agreement in my records.
20.In October 2011, shortly before Jen left work, Scanlan & Theodore engaged Natalie as a Merchandise Assistant, working 4 days per week. Natalie’s duties generally reflected what I had been doing as Merchandise Assistant before September 2011.
Offer of planning role
21.In early March 2012, I was approached by my direct manager Khatijah, who asked me about my interest in taking on and training for executive Planning duties, with the view to take over some of her responsibilities to lighten her load and free her up for other tasks. She said that she was “swamped” and was struggling to cope with her workload. She indicated that the role would be a promotion of sorts, more of a trainee Planning Manger role, rather than as her assistant. I politely declined the offer.
Becoming the permanent Merchandise Manager
22.In May 2012, I attended a meeting with Khatijah and Natalie to discuss Jen’s return to work. I believe this meeting occurred at the area around my desk. At the beginning of the meeting I believe Adam Smith (Distribution Manager) and Chris Indos (Distribution Assistant) were also present. In the meeting Khatijah introduced a new team structure, giving everyone a copy of a document titled “Scanlan & Theodore – Proposed Merchandise & Warehouse Team Structure and KPI’s” (organisational document). Khatijah spoke about the organisational document and referred to my title in that document as “Trainee Merchandise Manager” and said words to the effect that “I need to correct that”. At this time I believe Khatijah observed while I crossed out the reference to “Trainee” in my role on the organisational document. I generally understood my role as Merchandise Manager had then become permanent.
23.Now produced and shown to me and marked “MS-2” is a true copy of the organisational document given to me by Khatijah in May 2012.
24.Also in this meeting, Khatijah gave Natalie and I copies of revised position descriptions as well as a revised position description for Jen as “Merchandise Assistant (Part Time 3 Days)”. Natalie’s position description referred to her position as “Merchandise Assistant”. The key accountabilities identified in this position description generally reflected my role prior to September 2011. In the position description which Khatijah indicated related to me, my position was referred to as “Merchandise Manager”. Khatijah said Jen would be returning “part time” around mid May 2012 and she would work Mondays to Wednesdays, and that the breakdown of all the responsibilities once Jen returned would be as set out in the position descriptions. We then went through the positions descriptions and generally discussed the implication of this.
25.Now produced and shown to me and marked “MS-3” are true copies of the position descriptions for the positions of Merchandise Assistant, Merchandise Assistant (Part Time 3 days) and Merchandise Manager relating to Natalie, Jen and myself respectively.
26.Jen returned to work on 14 May 2012. Between May and July 2012 she was constantly ill but still came to work every day. I spoke to her about her sickness and suggested that she should take a day off to recover. However, Jen said to me words to the effect of “she could not afford to stay at home”.
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My pregnancy
15 March discussion with Khatijah
31.On or about 12 March 2012, I became aware that I was possibly pregnant. I subsequently had an ultrasound on 15 March 2012, which confirmed that I was about seven weeks pregnant.
32.The following day, 16 March 2012, I spoke to Khatijah, my direct manager, and told her about my pregnancy. I spoke with her in the Boardroom and showed her a photo from the ultrasound. In this meeting Khatijah asked me if she could have my permission to tell Gary Theodore and Sener. I said to her words to the effect of “yes, absolutely, that is why I’m telling you this as early as I am. I’m hoping that there will be plenty of time to make plans”.
20 April meeting with Sener
33.On or about 20 April I spoke with Khatijah and she suggested that I go and speak with Sener to personally share the news of my pregnancy. I said to her that I thought that she had already told him about my pregnancy. She said to me that she had told him, but that the right thing to do was for me to tell him in person as well.
34.At this time Sener and I had a positive working relationship. He was extremely friendly and we got along well. He would often enquire about what I was doing and how things were in the Warehouse. On occasion he would come down from his office to see me and tell me that he was happy with reports and other work that I had done. He was generally full of praise and friendly.
35.Later on 20 April 2012, I met with Sener in his office.
The meeting began by me telling Sener that I was pregnant. Sener then said words to the effect of “Wow, really? That is great Mon, congratulations. Was it planned?” I was shocked by this question, and began to try to answer. Sener then put his hands up and said to me “Don’t worry about it. It doesn’t matter.” I went on to tell him that it wasn’t planned, and that the pregnancy had come as quite the surprise. He then briefly spoke about his personal situation with his partner.36.Sener then said to me words to the effect of “What is happening with you and the planning duties?” He asked whether I had spoken to Khatijah about this, and whether I was going to take on the duties. I said to him that I was not going to take on the role because I didn’t feel that it was a good fit for me professionally. He said to me words to the effect of “Really? Can I get you to reconsider, because I think it would be best for you and best for the company and it is a really good opportunity.” I apologised and explained that I was not really comfortable with that line of work and that it wasn’t in my field of interest.
37.We also spoke about my maternity leave. Sener said to me words to the effect of “so, how long do you plan on being on maternity leave? Six months right? Six months?” He then repeated “six months” a number of times. I responded that I didn’t know and that as a first time mother it was very difficult to commit to a six month maternity leave. Sener’s demeanour changed at that point and he became very stern. Sener asked when I planned to commence my maternity leave, I said I wasn’t exactly sure but definitely around late September to early October depending on mine and the baby’s health.
38.He then asked me about my ambitions within the company, saying “if you don’t want to do the planning role, where do you see yourself in the long term?” I said words to the effect of “hopefully still here at Scanlan & Theodore”. I then spoke of my ambitions to help them set up an online retail store and perhaps manage on-line sales and processing.
39.He indicated that he was supportive, but said that he couldn’t make any promises.
June 2012 discussion with Robyn
40.In or around late June 2012, I spoke with Robyn Armstrong about my pregnancy and what I needed to do to apply for parental leave. In this discussion I told Robyn about my meeting with Sener and that I felt pressured to return to work as soon as possible, after the birth of the baby. I explained to Robyn, that as a first time mother it was difficult to predict how long I would want to stay at home with my baby.
41.Robyn suggested that I should “do what’s right” for myself, and my family. She went on to tell me that there are no real administrative provisions for maternity leave provided by the company. She said that the onus was on the employee to do their own research and provide their own application. She also suggested that I speak to Jen if I had any specific questions about the government paid parental leave and when and how to apply.
Absence from work in late June
42.On Monday, 25 June 2012, I felt unwell and took time off work to see my General Practitioner, Dr Ivor Green. Dr Green told me that it was a viral infection. He then provided a medical certificate and recommended 2 days rest at home.
43.I sent Khatijah a text message to let her know that I would be back at work the next day. Despite already notifying Khatijah and against Dr Green’s advice, I decided I would try to go to work anyway. It was already late in the afternoon but I felt guilty. Natalie was also sick at the time and I knew we were busy and understaffed. I left the GP’s and went home to get ready to go to work. While at home, I attempted to lift a very large load of wet laundry. I instantly and severely injured my back in the process. The pain was excruciating.
44.Later that same day, I went to see a Physiotherapist, Joshua Ongso about my back. After this consultation the Physiotherapist told me that the severity of the injury had been caused by my pregnancy. He also gave me a medical certificate which provided in part:
“Considering the amount of discomfort and the stage of her pregnancy, I would recommend that she rest for the next 3 days to allow her pain to settle sufficiently prior to returning to work. If she is able to drive after the rest period, I am happy for her to return to work. Otherwise I would recommend resting until next week.”
45.Now produced and shown to me and marked “MS-5” is a true copy of the certificate provided by Joshua Ongso, Physiotherapist, dated 25 June 2012.
46.After my appointment with the Physiotherapist, I telephoned Khatijah and told her what had happened. I knew we were busy and short staffed, I felt terrible and apologised profusely. I remember being on the verge of tears. In this discussion Khatijah seemed quite irritated. She said to me words to the effect of “well, we’ll just have to manage. There’s not a lot that we can do about it.”
47.On 26 June 2012, I emailed Sener and Khatijah, attaching the certificate provided by my Physiotherapist. In my email I noted that I was still in a lot of pain and that due to my pregnancy, I could not take any anti-inflammatory medication to ease the swelling/discomfort. Shortly after I sent that email I received a reply from Khatijah, thanking me for sending the certificate. I did not receive any response from Sener to my email.
48.Now produced and shown to me and marked “MS-6” is a true copy of my email to Khatijah and Sener, dated 26 June 2012 and Khatijah’s reply also dated 26 June 2012.
49.I returned to work on Friday, 29 June 2012. That morning, Sener
cameappeared downstairs and spoke to Adam Smith, Chris Indos and myself. He announced that in the week prior, the company had set a new record for “the most sick leave ever taken”. Sener seemed extremely serious and agitated. His face looked strained. His tone was deeply unimpressed. He was clearly unhappy with this new record. In this discussion Sener enquired about my back injury. He didn’t appear to listen to my answer before quickly changing topics. From that point onwards I feel that my working relationship with Sener changed. He was a lot less friendly and took less interest in my work. About this time I spoke to Jen about Sener and she said to me words to the effect of “Don’t worry Mon, it’s not personal. He did the same thing to me when I was pregnant.”50.Between about 29 June and 2 July 2012 I also noticed that Khatijah’s attitude towards me changed. She generally became cold, distant, and hostile towards me. For example, I attended a regular team meeting during this period in which people are generally encouraged to make contributions. In this meeting my comments were treated with disdain by Khatijah. She refused to make eye contact with me and openly ignored any comments I made. At end of the meeting Natalie said to me words to the effect of “Wow, she really hates you”, referring to Khatijah. As a result of this treatment I started to dread going to work and seeing her.
Staff meeting of 6 July
51.On 6 July 2012, I heard from other co-workers in my department that a meeting with Sener and Khatijah had been organised to discuss the departure of Dean Gunning, the Raw Materials Manager. Dean’s role has been vacant for approximately 2 weeks.
52.At approximately 3:30pm Sener and Khatijah arrived for the meeting. Also present were Adam Smith, Chris Indos, Natalie Khalil Sawan and Marie Mougos (the casual Warehouse Assistant). In the meeting Sener announced that Scanlan & Theodore would not be replacing Dean Gunning. Sener also discussed a new store opening in the CBD next year. There was then a discussion about whether the new CBD store would replace the existing Little Collins Street Store and Sener indicated that he was not sure. He spoke about sales being down and seemed agitated.
53.Sener, then asked us to “pull together” as a department in this uncertain time, and thanked us for understanding that Dean’s role could not be filled and that we would have to continue short staffed.
54.There then followed a heated discussion between Sener and Adam Smith (the Distribution Manager) about the lack of staffing. Following this, Sener asked if there were any other questions or concerns. No other questions or concerns were raised and the meeting was subsequently ended.
55.I have reviewed the document provided to me by Robyn Armstrong on 13 July 2012, which she described as being the minutes of the meeting on 10 July 2012. That document refers to a meeting on “Friday the 6th of July” and states that in this meeting Sener advised that “due to current economic circumstances resulting in the shrinking of sales, the company will be looking at further redundancies, in addition to the two made this year and the 2 resignations where we hadn’t replaced them”. Except for what he said about not replacing Dean Gunning, I deny that Sener made any reference to redundancies past, present or future at the meeting I attended on 6 July 2012.
56.Now produced and shown to me and marked “MS-7” is a true copy of document provided to me by Robyn Armstrong on 13 July 2012, which she described as being the minutes of the meeting on 10 July 2012.
Preparation of parental leave documentation
57.On 9 July 2012 I began preparing my paperwork for my maternity leave. In the afternoon on 10 July 2012, during my lunch break, I went to a pharmacy on Toorak Road near the Scanlan & Theodore Head Office and had a pharmacist witness my statutory declaration about being the primary carer for my baby, due on 2 November 2012.
58.That day I also prepared and completed my maternity leave application. At this time I was around 24 weeks pregnant.
59.Now produced and shown to me and marked “MS-8” is a true copy of my application for maternity leave, dated 10 July 2012, attaching my statutory declaration, dated 9 July 2012.
Termination
60.Also on 10 July 2012 at about 3:30pm I received a phone call from Sener requesting that I come upstairs to his office for a meeting at 4:45pm. Sener didn’t tell me what the meeting was about, but I presumed that it was to discuss my pregnancy and maternity leave. Jen overheard the phone call and we had a brief discussion about what the meeting might be about.
61.Presuming that meeting was regarding my maternity leave, before the meeting I made three copies of my maternity leave application, and took this with me to Sener’s office. The three copies were for Sener, one for Khatijah and one for Robyn.
62.I arrived at Sener’s office at around 4.40pm. He was in his office behind the glass wall, but I could see that he was busy. I sat outside his office and spoke with Sophia Kovacevic who was the Retail Communications and Public Relations Liaison. After a few minutes Sener came out of his office and walked towards the Boardroom, motioning for me to follow him. I followed Sener into the Boardroom. I think Robyn was already sitting in the Boardroom when I entered.
63.At the commencement of the meeting Sener said words to the effect of “this meeting is to inform you that your role had been made redundant and the redundancy is effective immediately”. I was in a state of shock and Sener continued talking. Sener gestured for Robyn to give me some paperwork, being a schedule of my pay on redundancy. This included a table of my entitlements, referring to my entitlement for pay for work performed, my annual leave entitlements, 4 weeks notice and 4 weeks redundancy. Also with this table were a number of pay advices. Now produced and shown to me and marked “MS-9” is a true copy of the schedule titled “Monica Schultz Redundancy Pay”, together with various pay advices as were provided to me by Robyn in this meeting.
64.Sener then said something to the effect that Robyn had compiled a generous redundancy package for me. He said that I should go though the papers and that if I had any questions Robyn would clarify them. He said that I had to understand that my redundancy was a purely financial decision. He said words to the effect of “I was the last to start and so I was the first to leave, I’m sorry, but that is the way things are”. He said they planned for Khatijah to absorb my role. He also stated that all full time roles in the Warehouse would be dissolved and staff would be replaced by a casual and part-time workforce.
65.He asked me if I had any questions. I asked him if there was any possibility of delaying the commencement of the redundancy. He asked me why? I said to him that I would not be eligible for the government paid parental scheme if I was terminated at that time. I asked him to please consider extending my employment so I could be eligible for paid parental leave.
66.In response, Sener sighed deeply. He said words to the effect of “give me a moment, I need to seek legal advice.” He and Robyn then left the Boardroom, I saw them go around the corner and they returned very soon after. On return he said that he had sought legal advice and, unfortunately, he would not be able to fulfil my request.
67.At this point he asked if I had any further questions. I said, words to the effect of “no, I’m in a state of shock. I thought this meeting was about my maternity leave” I went on to say something to the effect of “In fact this is why I prepared these documents for you. Here are copies of my maternity leave application.” I then went to pass to Sener copies of my application for maternity leave. In response, he put his hands in the air and asked “What’s that?” I told him that it was my maternity leave application. He asked me if I had submitted this to anyone yet. I said, words to the effect of “no, that is what I thought this meeting was about.” He appeared relieved and said, words to the effect of “no, I don’t want that, I don’t need to see that. It’s not relevant to this discussion.”
68.Sener asked me if I had any other questions. At that time I asked him if my pregnancy contributed to my redundancy. Sener then asked me why I would even ask such a question. I said that it was common that a woman’s pregnancy can make things difficult for her employers and that there have been many cases of women being discriminated against due to pregnancy. I referred to the difficulties surrounding maternity leave and he replied by denying my pregnancy had anything to do with my termination.
69.He reiterated that it was a financial decision and he had to do what was best for the company as a whole. I said that I had to do what was best for myself and my family and that I would be seeking legal advice. Sener then became angry. He picked up a pen and threw it in the direction of Robyn and said words to the effect of “Robyn, start taking notes, now”. Robyn did not pick up the pen or begin writing. At this time he said to me, words to the effect of “I am so offended, after everything we’ve done for you, after all the opportunities we’ve given you.”
70.Soon after this, at the end of the meeting, Sener offered to provide me with minutes from the meeting. He told me to contact Robyn to obtain these. However, no notes or minutes were taken by any of the parties present at the meeting.
71.At the end of the meeting, Sener reiterated that the redundancy was effective immediately.
72.I then went downstairs on my own. Khatijah appeared soon afterwards. I sat down at my computer to do a final check of my emails and Khatijah said to me words to the effect of “I have to ask you to log off your computer”. She sat at a nearby desk and watched me as I packed up my belongings and then escorted me from the premises in view of other staff members.”
The applicant had also filed a further affidavit on 22 July 2013 in which she deposed:
“1.I have read the affidavits filed by the respondent in this matter in this matter. In relation to this material, I make the following further statement in response:
Affidavit of Sener Besim
2.I refer to paragraphs 12 and 14 of Mr. Besim’s affidavit. Mr Bessim asserts that he did not directly oversee any of my responsibilities or duties as Merchandise Manager. I deny this assertion. Once I was appointed to the role of Merchandise Manager, Mr. Besim was the only person I reported to in regards to Promotional Vouchers and P.R. Purchases. Early on during my transition from Merchandise Assistant to Merchandise Manager, if I had a problem or query in these areas I would approach Ms. Hussain for assistance. Her answer was always consistently either “I’m not sure” or “I don’t know,” “Ask Sener” or “’I’ll ask Sener.” Eventually, I stopped approaching Ms. Hussain altogether and went directly to Mr. Besim with my queries.
3.Specifically, Promotional Vouchers can be used like store gift vouchers except that they are issued from Head Office. A few select senior staff members and the P.R. Representative, Emma Van Haandel, would regularly request Promotional Vouchers which I would process and issue. Occasionally, vouchers were requested as gifts by Gary Theodore and others. About halfway through my time as Merchandise Manager I recall Mr. Besim telling me that he was concerned with the volume and values of the Promotional Vouchers being issued. Mr. Besim told me that he wanted to closely monitor the vouchers being issued and asked that I email him with a formal report of all Promotional Vouchers and some of the P.R. purchases from the previous month. I believe initially I may have included Ms. Hussain in these monthly emails, but as she never responded, I eventually stopped sending them to her.
4.Also, around the same time in a different conversation Mr. Besim asked that all vouchers had to be directly approved by him. As such, my contact with Mr. Besim was a few times a week prior to my pregnancy announcement. After the announcement of my pregnancy and my period of sick leave, I started receiving requests for Promotional Vouchers for Mr. Besim from Ms. Hussain.
5.I refer to paragraph 18 of Mr. Besim’s affidavit. I agree that the April 20th meeting was informal, we sat side by side on the sofa in his office instead of opposite each at other at his desk. But Mr. Besim asserts that the meeting “only went for around 5 minutes.” I deny this assertion. I would estimate that the meeting took about 20 minutes.
6.I refer to paragraph 22 of Mr. Besim’s affidavit. Towards the very end of the 20 April meeting meeting Mr. Besim encouraged me to speak to Ms. Hussain. He said words to the effect of “Okay and about your maternity leave, speak to Khatijah and she’ll be able to help sort it out.” He did not mention that Scanlan & Theodore does not have any maternity leave application forms or other paper work.
7.On his advice, I did seek out Ms. Hussain very soon after for help with my maternity leave paperwork but she directed me straight to Ms. Armstrong. This is how I came to be in Ms. Armstrong’s office in or around late June 2012.
8.I refer to paragraph 34 of Mr. Besim’s affidavit. As at March 2012, and for the entire duration of my employment, Ms. Maria Sita was the Head of Product, not the Production Manager. The Production Manager is Ms. Jac Weatherley.
9.I refer to paragraph 39 of Mr. Besim’s affidavit. Mr. Besim asserts that Mr. Dean Gunning was present at the 6 July 2012, Warehouse meeting. This is incorrect. By then Mr. Gunning’s position had been vacant for approximately one to two weeks. His final day of work at Scanlan & Theodore was in the last week of June 2012.
10.I refer to paragraph 40 of Mr. Besim’s affidavit. I agree that Mr. Besim informed us that sales were down but I deny that Mr. Besim spoke about a greater demand for more casual staff and less full time employees. I believe I would have remembered any comment to that effect because this would have caused concern for me. Instead I recall walking away from the meeting feeling motivated and upbeat as Mr. Besim had thanked us for our flexibility and understanding and had asked us to “pull together” in this uncertain time. I did not enter into, nor did I overhear any discussions about the possibility of further redundancies or casual staff being favored over full time employees.
11.Mr. Besim also denies that the exchange between himself and Mr. Smith was heated. I agree that while the conversation began in a joking manner, it quickly became heated when Mr. Smith kept pressing the issue of needing more staff for the upcoming release of new season stock. Directly after the meeting I said to Mr. Smith words to the effect of “Go, Adam. That was a bit intense.” In response, Mr Smith said words to the effect of “It had to be said.”
12.I refer to paragraph 52 of Mr. Besim’s affidavit. Mr. Besim asserts that I sat across the desk and glared at him. I deny this assertion.
13.Further at paragraph 52 of Mr. Besim’s affidavit Mr. Besim asserts that I referred to “many unfair dismissal cases involving pregnant women.” I deny this assertion. I also deny that Mr. Besim told me I was “welcome to seek legal advice.”
14.I refer to paragraph 53 of Mr. Besim’s affidavit. Mr Bessim denies that he said words to the effect of “I was the last to start and so I was the first to leave.” I particularly recall this phrase because Mr. Besim used it in reference to the staff working in the Warehouse and the statement was both confusing and incorrect. Also, it is a phrase that I had heard used by Mr. Besim once before in reference to the Sample Machinist who was made redundant in or around March 2012. He said at the time, words to the effect of “We have too many heads upstairs. Normally, it’s a case of last to start, first to leave – But in this case it was a performance based decision.”
Affidavit of Khatijah Hussain
15.I refer to paragraph 12 of Ms. Hussain’s affidavit. Ms. Hussain asserts that I was nervous about taking on the role of Merchandise Manager and making the transition from Merchandise Assistant to Merchandise Manager. I deny this assertion. Prior to taking on the Merchandise Manager role I had 3 years experience working in a supervisory role. I did not have any serious reservations about making the transition to a managerial position and was quite excited at the prospect.
16.I refer to paragraph 15 of Ms. Hussain’s affidavit. Ms. Hussain asserts that there was no formal routine of reporting between the role of Merchandise Manager and Mr. Besim. This is incorrect. Mr. Besim requested a formal routine of reporting during my time as Merchandise Manager.
17.I refer to paragraph 31 of Ms. Hussain’s affidavit. Ms. Hussain asserts that Mr. Besim noted that there had already been a number of redundancies earlier in the year and said that there could be more. I deny this assertion. Except for what Mr. Besim said about not replacing Mr. Dean Gunning, I deny that Mr. Besim made any reference to redundancies past, present or future.
18.I refer to paragraph 36 of Ms. Hussain’s affidavit. I did not ask Ms. Hussain for help to carry my belongings. My husband had parked directly outside the Head Office building and had come inside to help carry my belongings from my desk to the car. It was a distance of less than 15 metres. There were 2 or 3 medium sized boxes to carry.
Affidavit of Robyn Armstrong
19.I refer to paragraph 7 of Ms. Armstrong’s affidavit. Ms. Armstrong asserts that I emailed her each week to inform her of the working hours of the Merchandise team. This is incorrect. I also emailed her in regards to the Distribution Department including any casual employees working within their department.
20.I refer to paragraph 13 of Ms. Armstrong’s affidavit. Ms. Armstrong asserts that Mr. Besim told me that my role would be absorbed by others and that Ms. Hussain would be taking over a number of duties. This is not correct. Mr. Besim said they planned for Ms. Hussain to absorb my role. He did not mention any others.
21.I refer to paragraph 14 of Ms. Armstrong’s affidavit. Ms. Armstrong asserts that I commented on the fact that I was aware of a number of unfair dismissal cases involving pregnancy. I deny this assertion.
22.I refer to paragraph 18 of Ms. Armstrong’s affidavit. Ms. Armstrong asserts that Mr. Besim told me that I was free to explore any legal avenues that I felt were necessary. I deny this assertion. I also deny that Mr. Besim told me that Scanlan & Theodore was aware of its obligations relating to redundancies and that he was confident that Scanlan & Theodore had done everything it was required to do in making me redundant.
23.I refer to paragraph 21 of Ms. Armstrong’s affidavit. Ms. Armstrong asserts that as the meeting concluded, Mr Besim asked if I had any questions and that I responded by sitting and staring at Mr. Besim. I deny this assertion. The last thing Mr. Besim said to me while still at the boardroom table were words to the effect of “I am so offended, after everything we’ve done for you, after all the opportunities we have given you…” At this point Mr. Besim walked towards the boardroom door, which was directly behind him. He opened the door and asked me “Is there anything else?” I asked if the redundancy was effective immediately and Mr. Besim replied yes. Ms. Armstrong asserts that Mr. Besim told me I could contact her to get a copy of the minutes. At this same time he also said words to the effect of “You’re entitled to the minutes from this meeting. Contact Robyn to get a copy.”
Affidavit of Jennifer Ratcliffe
24.I refer to paragraph 8 of Ms. Ratcliffe’s Affidavit. Ms Ratcliffe refers to Ms. Sawan as the other Assistant Merchandise Manager. Ms. Sawan position during my employment with Scanlan & Theodore was a Merchandise Assistant.
25.I refer to paragraph 26 of Ms Ratcliffe’s affidavit. Ms. Ratcliffe initiated this discussion about Mr. Besim and my pregnancy. The conversation began with her saying to me words to the effect of “How’s Sener been since you told him about the baby?” I told Ms. Ratcliffe that he had been noticeably distant. I said words to the effect of “I don’t know, kind of weird, kind of distant.” Ms. Ratcliffe did not seem surprised by this. She replied “Don’t worry Mon, it’s not personal. He did the same thing to me when I was pregnant.”
The applicant gave evidence and was cross examined.
Respondent’s evidence
Sener Besim
Mr Sener Besim is currently employed as the General Manager of the respondent at its head office in South Yarra. In Mr Besim’s affidavit filed on 21 June 2013 he deposed inter alia:
“…
Ms Schultz’s position at the company
11.Ms Schultz was employed by Scanlan & Theodore in or around November 2010. Ms Schultz was initially employed in the role of Merchandise Assistant. I had no involvement in Ms Schultz's recruitment to Scanlan & Theodore.
12.In the role of Merchandise Assistant, Ms Schultz reported directly to Ms Jennifer Ratcliffe who, at that time, was employed in the position of Merchandise Manager. Ms Schultz also reported to Khatijah Hussain, who is employed as the Planning Manager and directly oversees the position of Merchandise Manager. I did not directly oversee any of Ms Schultz's responsibilities or duties in her role of Merchandise Assistant.
13.In or around October 2011, Ms Schultz was appointed to the position of Merchandise Manager. Ms Hussain had informed me that she intended to promote Ms Schultz to the role of Merchandise Manager whilst Ms Jennifer Ratcliffe was on maternity leave. In her role as Merchandise Manager, Ms Schultz reported directly to Ms Hussain.
14.I did not directly oversee any of Ms Schultz's responsibilities or duties as Merchandise Manager. I refer to paragraph 7 of Ms Schultz's affidavit. Ms Schultz states that I directly oversaw her responsibilities connected to promotional vouchers, P.R. purchases, staff clothing allowances and all associated reporting. From time to time, I would speak with Ms Schultz and ask her to provide me an update on figures for the staff clothing allowances for the season or provide promotional vouchers as required, however, I did not oversee or manage Ms Schultz's performance. I would only have contact with Ms Schultz a few times a month in relation to these tasks.
15.In or around October 2011, Scanlan & Theodore engaged another Merchandise Assistant, Natalie Sawan, to work in Head Office and assist with the workload while Ms Ratcliffe was on maternity leave. Ms Sawan is a casual employee, but she works set days and hours. Ms Sawan was previously employed in the South Yarra Retail Store as a Stock Room Assistant and was already familiar with the Respondent’s business and merchandise systems.
Ms Schultz’s pregnancy
16.In or around early-mid April 2012, Ms Hussain told me that Ms Schultz was pregnant. Ms Hussain said that Ms Schultz wanted to tell me on her own, but that she had been given the 'okay' by Ms Schultz to let me know. My conversation with Ms Hussain regarding Ms Schultz's pregnancy was very brief. Ms Hussain mentioned it to me in passing. I do not recall the context in which Ms Hussain informed me of Ms Schultz's pregnancy.
17.On or around 20 April 2012, Ms Schultz came to my office to speak to me. I invited Ms Schultz in and told her to take a seat. It was a very informal meeting. Ms Schultz then told me that she was pregnant. I said words to the effect of 'Fantastic, congratulations!'. I was genuinely excited and happy for her. I then asked Ms Schultz if the pregnancy was planned. I asked this because my wife and I had been trying to have a baby for around seven years and, as such, I was used to asking friends about their pregnancies and whether they had been trying for long, given my own personal experience. I quickly realised that this might be an awkward question to ask Ms Schultz and so I said 'It doesn't matter' and moved on from the question. She nevertheless told me that the pregnancy had come as a surprise. I told Ms Schultz about my own personal experience and the fact that my wife and I were struggling to have a baby.
18.I then asked Ms Schultz in a general sense what she was planning to do. She said that she thought she would work until around October 2012 and then take maternity leave and that she intended to come back to work after that. I then asked her how everything else was going. The meeting was very informal and only went for around 5 minutes. The meeting ended with me saying to Ms Schultz words to the effect of 'Thanks for letting me know'.
19.I refer to paragraph 36 of Ms Schultz's affidavit. Ms Schultz asserts that I asked her about additional planning duties and whether she had spoken to Ms Hussain about these additional duties and that I asked her to reconsider accepting a planning role. I deny that I discussed any additional planning duties or any planning role with Ms Schultz during this meeting. I had asked Ms Schultz generally how she was going with work, but there was no planning vacant planning role and I did not ask her about any planning duties.
20.I refer to paragraph 37 of Ms Schultz's affidavit. I deny that I asked how long Ms Schultz planned to be on maternity leave. I also deny pressuring her to take a period of six months maternity leave and becoming stern with her during the meeting. I simply asked Ms Shultz what she planned to do, just by way of general conversation. I was not concerned with her maternity leave during this meeting. I did not discuss the duration of her intended maternity leave with her at any time during this meeting or during her employment with Scanlan & Theodore.
21.I refer to paragraph 38 of Ms Schultz's affidavit. I deny that I asked Ms Schultz where she saw herself with the company in the long term. As previously stated, I did not discuss her current position or any other positions with her during this meeting other than to ask her how she was going generally. I don't usually have a lot of contact with employees who report directly to the Planning Manager or the Product Manager. As such, when these employees come to my office, I usually try to have a bit of a catch up with them and see how they are going. The meeting with Ms Schultz was an informal chat, which she had initiated, to advise me of her pregnancy. I don't recall if Ms Schultz said anything about an online retail store during this meeting. Scanlan & Theodore do not have an online retail store, so I am unsure how this would have come up in conversation and I do not recall discussing it.
22.Ms Schultz has previously described this meeting in the application that she filed with the Fair Work Commission on 1 August 2012. A true copy of Ms Schultz’s general protections application is attached to this affidavit and marker ‘SB-2’. At paragraph 16 of her general protections application, Ms Schultz states that I directed her to prepare a parental leave application and necessary paper work during the meeting on 20 April 2012. Ms Schultz has not raised this in her affidavit. I deny that I directed Ms Schultz to complete paper work regarding her maternity leave. Further, Scanlan & Theodore does not have any maternity leave application forms or other paper work that we require our staff to complete prior to taking maternity leave.
Treatment of Ms Schultz following a period of sick leave
23.I refer to paragraph 12 of Ms Schultz's affidavit. Ms Schultz asserts that employees often came in to work when they were unwell. She states that there was an increased culture of martyrdom and that management was not tolerant of absences. She also states that there was a lack of empathy at Scanlan & Theodore and that management negatively judged employees who took sick days. I deny these assertions. Scanlan & Theodore is supportive of its staff. There have been numerous occasions when staff have taken extended absences, whether it be for long holidays, extended sick leave or parental leave.
24.Employees are never forced to come in to work when they are sick or unwell.
If Ms Schultz observed employees coming to work when they were seemingly unwell, that would have been because that employee made a decision to come to work.I understand that people come in to work from time to time if they have minor colds, but generally speaking, I don’t want employees coming in to the office if they are sick – aside from anything else, there is a risk that they will make other staff sick.25.I refer to paragraph 49 of Ms Schultz's affidavit. Ms Schultz asserts that, following a period of sick leave between 25 and 28 June 2012, I was a lot less friendly to Ms Schultz and took less interest in her work. At paragraph 25(b) of Ms Schultz's statement of claim, she asserts that I refused to deal directly with her after she returned from sick leave on 29 June 2012. I deny these allegations.
26.As previously stated, I did not directly oversee Ms Schultz's duties as Merchandise Manager. I deny that my working relationship with Ms Schultz changed after she took sick leave between 25 and 28 June 2012. Ms Schultz and I always had a professional working relationship, both before and after she took sick leave in June 2012.
27.I refer to paragraph 49 of Ms Schultz’s affidavit. Ms Schultz asserts that I announced that the company had set a new record for ‘the most sick leave ever taken’. She says that I was extremely serious, agitated and unimpressed. I deny that I made these comments. Further, I have never been agitated or unimpressed by the amount of sick leave taken by employees when employees are genuinely unwell.
Sales performance of the business
28.In the years leading up to 2009, the Respondent's business was experiencing significant sales. In 2006, 2007 and 2008, the business
exceeded its annual sales targetsexperienced growth. Mr Theodore and I set the annual sales targets around 6 to 12 months in advance. We set the targets with reference to our previous season's performance and any variations in the market that we are aware of. In 2007, sales increased by around10 percenton the previous year. In 2008 sales increasedby a further 14 percenton the previous year. A true copy of the annual sales figures for 2006, 2007 and 2008 are attached to my affidavit and marked 'SB-3'.29.In 2009, the Respondent's business experienced a significant downturn in sales. The annual sales decreased
by around 26 percentwhen compared with 2008. I suspect that this decline was because of the global financial crisis. In 2010 and 2011, the sales figures increased, however the annual sales figures for 2011 were still much lower than the figures we had seen in 2008. A true copy of the annual sales figures for 2009, 2010 and 2011 are attached to my affidavit and marked 'SB-4'.30.In 2012, the Respondent had budgeted for growth in terms of our sales. We had refocussed the business and had expectations that we would be able to achieve sales figures consistent with what we achieved in 2008. However, the business experienced an unexpected downturn in sales again in 2012. By 30 June 2012, sales had decreased by around 10 percent from the winter season in the previous year. I was extremely concerned about the performance of the business as it was completely unexpected and quite worrying. Our sales figures were still much lower than expected by 31 December 2012. The overall annual sales figures for 2012 were around 6 percent lower than the previous year. A true copy of the annual sales figures for 2012 is attached to my affidavit and marked ‘SB-5’.
Resignations and redundancies in 2012
31.As a result of the financial performance of the business, in 2012 there were a number of redundancies in the Head Office. The first position to be made redundant was a Sample Machinist role in January 2012. At that time, there were five Sample Machinists employed by Scanlan & Theodore. The Sample Machinists work in tandem with the Pattern Makers. There were also five Pattern Makers employed at that time. One of the Pattern Makers, Roslyn Jack, resigned on or around 22 January 2012. In light of the financial performance of the business, we decided not to replace the Pattern Maker following the resignation and, as such, the position of Sample Machinist was selected for redundancy. This is because the role of Sample Machinist is dependent on the role of Pattern Maker for work.
32.I monitored the sales figures for the Respondent closely throughout 2012. Mr Theodore and I discussed the possibility of further redundancies depending on the financial performance of the business. We were discussing the financial performance of the business at the start of each week and again towards the end of each week. In light of the fact that sales were decreasing, we were of the view that we would be handling less product and that there would be less staff required. Further, a reduction in staffing also reduces the overhead costs for the Respondent, and we were conscious of the Respondent's overall financial performance.
33.We identified middle management roles as the positions that would likely be made redundant in the event that further redundancies were to occur. We selected middle management roles because we felt that the key duties for these types of roles could be absorbed by other more senior managers. This is because when the Respondent's business was smaller, management staff took on a number of different roles. As the business expanded, we split up the duties and created new roles. In light of the fact that the Respondent's business was decreasing again, we considered that some of the roles could be merged and performed by a lesser number of employees. These discussions were subsequently put into effect in 2012, as follows.
34.In March 2012, the position of Workroom Manager was made redundant. The key function of this role was to oversee the Pattern Makers and the Sample Machinists. This function was absorbed by our Product Manager, Ms Maria Sita.
35.In April 2012, the position of Quality Care Manager was made redundant. The key duties of this role were to inspect the merchandise for defects, to inspect the workmanship of our manufacturing team, to liaise with our suppliers and perform spot inspections of our stock. These duties were absorbed by Jacqui Weatherly, Production Manager.
36.Finally, in July 2012, Ms Schultz's position as Merchandise Manager was made redundant. The key duties of this role were to oversee stock allocation and to oversee functions of the Warehouse, such as pricing, barcoding and product recalls. These duties were absorbed by Ms Hussain and the other employees in the Merchandise Team. I discuss this further below.
37.In addition to the four positions that were made redundant in 2012, there were 2 voluntary resignations. As mentioned, in January 2012 one of the Pattern Makers resigned. This position was not replaced until June 2013. In July 2012, the Fabric Warehouse Manager resigned. This position has not been replaced.
38.The organisational structure of the Head Office changed significantly in 2012. A true copy of the organisational structure as at 1 January 2012 is attached to my affidavit and marked 'SB-6'. A true copy of the organisational structure of the Head Office as at 30 July 2012 is attached to my affidavit and marked 'SB-7'. We have not replaced any of the positions that were selected for redundancy.
Decision to make the role of Merchandise Manager redundant
39.On 6 July 2012, I held a meeting with some employees in the warehouse. Ms Hussain and Ms Schultz were present, along with Mr Adam Smith (Warehouse Manager), Mr Dean Gunning (Fabric Warehouse Manager), Chris Indos (Assistant Warehouse Manager), Natalie Sawan (Merchandise Assistant), Marie Mougos (Warehouse Assistant).
40.The purpose of the meeting was two-fold. Firstly, I discussed with staff the economic climate and told them that the business was declining when we had budgeted for growth. I told employees that sales were down. I explained that, as a result of the financial performance of the business and the changes in the industry generally, the business needed to become more flexible and that there was a greater demand for more casual staff and less full-time employees. This is because we were trying to reduce our fixed costs and engaging casual employees would allow us the flexibility to employ more staff during our busy periods and less staff during our quieter periods. I said that there had been a few redundancies in the Head Office and that there would likely be more redundancies in the future.
41.The second thing I discussed was the resignation of Mr Gunning, Fabric Warehouse Manager. I informed staff that we would not be replacing Mr Gunning's position. I explained that there would need to be adjustments with workload so that Mr Gunning's duties could be picked up by other staff. I also spoke briefly about the new store we would be opening at the Myer Emporium in the Melbourne CBD. I cannot recall who asked me, but I was asked whether the new Myer Emporium store would replace the Little Collins Street Store. I said that I was unsure what would be happening with the Little Collins Street Store, as I was not sure if the Respondent could get out of its lease. The lease for the new Myer Emporium store is due to commence in around March 2014.
42.The Respondent was first offered the option of taking out a lease in the Myer Emporium complex in or around November 2011. The terms of the lease are such that the landlord has agreed to pay all of our fit out costs. Further, the rent payable by the Respondent is variable to the sales that we make at that store. It was a fantastic offer with no financial risk to the Respondent. In light of the leasing arrangement, we are of the view that the Respondent will make a profit from the Myer Emporium store. On the other hand, the Respondent pays a fixed rent for the lease of the Little Collins Street store, regardless of the sales that we make in that store.
43.Towards the end of the meeting, Mr Smith asked about the new release of stock and requested that he be given a casual employee to assist him. Mr Smith worked for Scanlan & Theodore for approximately 13 years and I had a good working relationship with him. Mr Smith said, in a joking manner, words to the effect that 'I better get one or I will lose it.' He laughed when he said this. I replied, also joking, words to the effect of 'Tell me how you really feel about it.' The conversation was not heated, as alleged by Ms Schultz at paragraph 54 of her affidavit.
44.The meeting drew to an end and I asked staff if they had any questions and told them they could speak to me if they had any concerns.
45.I spoke with Mr Theodore that weekend about the performance of the business. I called Mr Theodore again on Monday 9 July 2012. Mr Theodore was overseas in Greece at the time. During that conversation, we discussed the sales figures for the month and decided that we needed to make another position redundant. Mr Theodore and I had been monitoring the performance of the business from week to week for the past few months and were concerned that we hadn't seen any improvement in sales. I considered the remaining middle-management roles and decided that the position of Merchandise Manager should be selected for redundancy, because I was confident that Ms Hussain was capable of taking over the key duties of that role. Ms Hussain had previously been employed by Scanlan & Theodore in the position of Merchandise Manager. As such, I was of the view that the duties of the Merchandise Manager could be redistributed and absorbed by Ms Hussain and the rest of the Merchandise Team.
Meeting with Ms Schultz on 10 July 2012
46.The following day on 10 July 2012, at approximately 10.00am, I telephoned Ms Schultz and asked her to come to a meeting in my office at 4.45pm. I also spoke with Robyn Armstrong, Accounts Officer. I told Ms Armstrong that we were making Ms Schultz's position redundant and asked her to prepare a redundancy package for Ms Schultz. I also asked her to attend a meeting with Ms Schultz and I that afternoon.
47.That afternoon at around 4.45pm, Ms Schultz attended my office and I went with her to the boardroom next door. Ms Armstrong was already in the boardroom when we arrived.
48.At the start of the meeting, I told Ms Schultz that the purpose of the meeting was to inform her that her position was being made redundant, effective immediately. I was concise and to the point during this meeting. I told Ms Schultz that the decision to make her position redundant was purely a financial decision, and was because of the financial performance of the business and the tougher economic climate, particularly in the retail industry. I refer to and generally agree with paragraph 63 of Ms Schultz's affidavit.
49.Ms Schultz seemed to have incorrectly assumed that I had called the meeting to discuss her maternity leave because she tried to give me an application for parental leave. I told her that I did not need the application because it wasn't relevant to the discussion. Ms Schultz then asked whether she was being made redundant because she was pregnant. I responded with words to the effect of 'absolutely not'. I reiterated that the decision was a financial decision and told her that I was offended that she suggested it was because she was pregnant. I told Ms Schultz that there had been a number of employees that had taken maternity leave and that the decision had nothing to do with that.
50.Ms Schultz then asked me whether I could delay her redundancy, as she was not yet eligible for the government's paid parental leave. I did not understand what Ms Schultz was referring to at the time, so I took a brief recess to step outside the boardroom and confer with Ms Armstrong. Ms Armstrong explained to me Ms Schultz was asking to delay her termination by one month so that she could access government benefits to paid parental leave. Ms Armstrong said that she didn't think it was ethical to do that. I agreed.
51.Ms Armstrong and I returned to the boardroom and I told Ms Schultz that it was unethical and unconscionable to play around with termination dates and that all redundancies at the company had been effective immediately. I also said that, due to the financial performance of the business, we couldn't keep her on any longer.
52.I asked Ms Schultz whether she had any further questions. She did not respond to me and sat across the desk glaring at me. I asked her again if she had any questions, but she still didn't respond. Ms Schultz then said that she was aware of many unfair dismissal cases involving pregnant women. I told her that she was welcome to seek legal advice. The meeting concluded at around 5.00pm. Following the meeting, Ms Hussain went with Ms Schultz to pack up her desk.
53.I refer to paragraph 64 of Ms Schultz's affidavit. Ms Schultz asserts that I said words to the effect that she was the last to start and so she was the first to leave. I deny this assertion. I did not say this to Ms Schultz. Further, there had already been 3 other redundancies in the Head Office by the time that Ms Schultz's position was selected for redundancy. She was not the first employee to be selected for redundancy. We selected positions for redundancy on the basis of the Respondent's ability to redistribute the duties connected with those positions.
54.I refer to paragraph 69 of Ms Schultz's affidavit. Ms Schultz asserts that I became angry and threw a pen at Ms Armstrong and told her to start taking notes. This is incorrect. I did not get angry during this meeting. I was genuinely surprised and a little offended when Ms Schultz suggested that we were dismissing her because she was pregnant, but I was not angry or aggressive and I did not throw a pen at Ms Armstrong and tell her to start taking notes. Ms Armstrong was already taking notes during the meeting. Ms Schultz asserts that I said that I was offended given the opportunities that the Respondent had provided to her. I do not specifically recall this. I did say words to the effect that I was offended and that the Respondent had been a good place for her to work.
55.I refer to paragraph 79 of Ms Schultz's affidavit. Ms Schultz asserts that I asked her at around 3.30pm to attend a meeting on 10 July 2012. This is incorrect. I asked Ms Schultz that morning at around 10.00am.
56.I refer to paragraph 80 of Ms Schultz's affidavit. Ms Schultz asserts that I did not make any reference to a long history of staff taking maternity leave or use the phrase 'completely ridiculous'. I did mention to Ms Schultz that there had been a number of people who had taken maternity leave. I do not recall if I specifically used the words 'completely ridiculous', but I did say words to that effect because Ms Schultz's pregnancy had nothing at all to do with the decision to terminate her employment.
57.I refer to paragraph 81 of Ms Schultz's affidavit. Ms Schultz asserts that I did not use the words 'irresponsible, unconscionable and unethical' when she asked me to delay her redundancy. I specifically recall using the words unconscionable and unethical. This is because I understood that Ms Schultz was asking me to change her termination date so that she could access government benefits and I thought it was unethical to do that.
58.I refer to paragraph 82 of Ms Schultz's affidavit. Ms Schultz denies that I spoke about the numerous cases of pregnancy. As previously stated, I did mention to Ms Schultz that there had been a number of women who had taken maternity leave. Ms Schultz also denies that I said that she was free to explore legal avenues and that Scanlan & Theodore were aware of its obligations in relation to redundancy. I did say words to this effect.
59.Following the meeting, Ms Schultz went to pack up her belongings. I asked Ms Hussain to go down and supervise her packing up her things. I did not speak to Ms Schultz again. The following day, Ms Armstrong forwarded me an email from Ms Schultz. Ms Schultz requested that we give her a copy of our notes from the meeting. Around that time, I called the Australian Retailers Associated and asked them whether we were required to provide a copy of our notes to Ms Schultz.
60.Ms Armstrong sent me a copy of the notes that she had typed up following the meeting. I read through the notes and made some minor changes to some of the wording and grammar. I otherwise felt that the notes accurately represented what took place at the meeting. I also added in a paragraph to include a reference to the meeting that had taken place on 6 July 2012. I assumed that Ms Schultz intended to use the notes to consider her legal options, as she had made it clear during the termination meeting that she intended to seek legal advice. I included a reference to the meeting on 6 July 2012 to provide context to the termination meeting. I sent the notes back to Ms Armstrong to forward on to Ms Schultz. A true copy of the notes that were provided to Ms Schultz are attached to this affidavit and marked 'SB-8'. I confirm that these notes are an accurate representation of what took place at the meeting on 10 July 2012 and on 6 July 2012.
61.Following Ms Schultz's dismissal, the duties of the role of Merchandise Manager have been redistributed. Ms Hussain oversees the Merchandise Department. As such, she reallocated the duties of the Merchandise Manager role as she saw fit.
…
65.As previously mentioned, the workforce at Scanlan & Theodore is approximately 95% female. As such, we have a long history of women taking and returning from maternity leave. The following is a list of employees who have taken maternity leave and returned to work since 2009:
a.Ms Michelle Theodore (Retail Store Manager) went on maternity leave in August 2008 and returned to work in February 2009;
b.Ms Lina Morales (Retail Sales) went on maternity leave in October 2009 and returned to work in around May 2010;
c.Ms Therese Feltham (Pattern Maker, Head Office) went on maternity leave in July 2009 and returned to work in February 2010;
d.Ms Christine Virgiotis (Retail Sales) went on maternity leave in July 2011 and returned to work in March 2012;
e.Ms Theodore went on maternity leave for the second time in August 2011 and returned to work in February 2012;
f.Ms Natalie Edel (Retail Sales) went on maternity leave in September 2011 and returned to work in May 2012;
g.Ms Ratcliffe went on maternity leave in October 2011 and returned to work in May 2012;
h.Ms Morales went on maternity leave for the second time in April 2012 and returned to work in January 2013; and
i.Ms Feltham went on maternity leave for the second time in September 2012 and is still on maternity leave. At the time she took maternity leave, she said that she intended to take maternity leave for 12 months. I expect that Ms Feltham will return to her role as Pattern Maker on a part-time basis when she comes back from maternity leave.
66.Ms Theodore, Ms Morales, Ms Feltham, Ms Virgiotis, Ms Edel and Ms Ratcliffe are all still employed by Scanlan & Theodore.”
Mr Besim also filed a supplementary affidavit on 26 August 2013.
In that affidavit he deposed:
“Introduction
1.I previously swore an affidavit in this matter in the Federal Circuit Court on 2l June 2013 (first affidavit). I make this affidavit in supplement to the first affidavit.
Decision to make the role of Merchandise Manager redundant
2.I refer to paragraph 45 of my first affidavit. The purpose of my telephone call to Mr Theodore on 9 July 2013 was to inform him of the financial position of the Respondent and to express my view that it was necessary, by reason of that financial position, to make another position redundant at the Respondent.
3.Prior to the telephone conversation, I had already considered which position ought to be made redundant. I reached the conclusion that the position of Merchandise Manager would be made redundant as it could be largely absorbed into Ms Khatijah Hussain's role as Planning Manager and with other employees assuming some of the duties.
4.In my conversation with Mr Theodore, I presented him with this proposition, that is, that Ms Schultz's role as Merchandise Manager ought be made redundant and why
I had formed that view. Mr Theodore agreed with my logic. This was the first time that I had discussed the possible redundancy of Ms Schultz with Mr Theodore. My recollection is that we had the discussion over one telephone call, but it may have been over two calls.
5.We did not discuss Ms Shultz's pregnancy during this conversation. The fact that she was pregnant was not any part of the reason for making Ms Schultz's role as Merchandise Manager redundant.”
Mr Besim gave evidence and was cross examined.
Gary Theodore
Mr Gary Theodore is the Director and Head Designer for the respondent who filed an affidavit on 26 August 2013. In that affidavit he deposed inter alia:
“Background and qualifications
1.Between l98l and approximately 2001 there was another Director of the Respondent since 2001 I have been the sole Director of the Respondent.
Current role at Scanlan & Theodore
2.In my role as Director, I am responsible for ensuring that the financial position of the Respondent is sound and that any financial commitments made by the Respondent are met. I have the overall financial responsibility for the Respondent.
3.In my current role as Head Designer, I am responsible for designing ranges of clothing that are saleable and delivered on time.
Financial position of Scanlan & Theodore 2006-2011
4.In the period of 2006 to 2008, prior to the global financial crisis, the financial position of the Respondent was good. The business was growing and we were achieving good sales figures.
5.The Respondent's business suffered substantially in 2009 during the global financial crisis and our sales dropped away. The Respondent had made financial commitments including in respect of orders for fabrics for coming seasons, and that put us in a difficult financial position.
6.In the period 2010 to 2011 the Respondent's financial position stabilised. However the Respondent has not regained the peak financial position it achieved in 2008.
7.During 2012 the Respondent's financial position tapered downwards and sales did not grow as expected. Towards the beginning of 2012, I had discussions with Mr Sener Besim (Besim), the Respondent's General Manager, about the need to undertake redundancies. This was on the basis that the Respondent was selling less clothes and therefore did not need as many employees in Head Office to run the business. To save costs, the Respondent made a number of employees redundant and also did not replace a number of employees who had resigned.
Decision to make the role of Merchandise Manager redundant
8. On 9 July 2012, whilst I was in Greece, I had a telephone conversation with Besim regarding the current financial position of the Respondent. Besim told me that the financial performance of the business was not good and that sales were down. Besim told me that, in his opinion, the Respondent needed to make another position redundant. Besim told me that he had identified the Applicant's position of Merchandise Manager as one that could be made redundant. Besim explained to me that the duties of the Merchandise Manager could largely be absorbed by the Planning Manager, Khatijah Hussain, to whom the Applicant reported.
9.I told Besim that I supported his decision regarding the redundancy and agreed with the logic behind the decision. I then left the final decision, and its implementation, to Besim.
10.I cannot recall whether this discussion occurred over one or two telephone conversations. At no point in any conversation I had with Besim about the redundancy of the Merchandise Manager role and the termination of the Applicant's employment was her pregnancy discussed. I am unable even to recall whether I was aware that the Applicant was pregnant at the time of the discussion.”
Mr Theodore gave evidence and was cross examined.
Khatijah Hussain
Ms Khatijah Hussain is currently employed as the Planning Manager at head office for the respondent. In Ms Hussain’s affidavit filed on
20 June 2013 she deposed inter alia:
“10.When Ms Schultz commenced at Scanlan & Theodore in the position of Merchandise Assistant, she reported directly to Ms Ratcliffe. Ms Schultz also reported to me. At that time, I directly oversaw the position of Merchandise Manager and would have regular contact with employees in the position of Merchandise Assistant. I worked with Ms Schultz on a daily basis.
11.The key duties of a Merchandise Assistant included processing of stock allocations, consolidation and balancing, processing of clearance store stock, maintenance of the gift voucher log, barcoding and processing of merchandise as required, processing of all stock movement and transfers, answering store related queries, management and processing of the staff wardrobe and daily reconciliation of David Jones sales.
12.In early 2011, Ms Ratcliffe informed me that she was pregnant. I spoke with Ms Schultz in around June 2011 and told her that she would be appointed to the position of Merchandise Manager whilst Ms Ratcliffe was on maternity leave. We initially appointed Ms Schultz to the role of Merchandise Manager on a temporary basis whilst Ms Ratcliffe was on maternity leave.
Ms Schultz was nervous about taking on the role of Merchandise Manager. I made it clear to her that she would have my full support and that I would help her through the transition from Merchandise Assistant to Merchandise Manager. Ms Ratcliffe also provided training to Ms Schultz before she went on maternity leave. Ms Ratcliffe went on maternity leave in or around late September / early October 2011.13.In or around early October, I provided Ms Schultz with an updated contract of employment to reflect her new role as Merchandise Manager. A true copy of the contract of employment dated 7 October 2011 is attached to this affidavit and marked 'KH-2'.
14.In the position of Merchandise Manager, Ms Schultz reported directly to me. The key duties of the Merchandise Manager role included answering store related queries, overseeing Head office support for all stock takes, overseeing all stock allocation, processing of David Jones sales, management of staff allowance processing, permanent mark-down processing, arranging product recalls, management of PR purchases (which are the public relations gifts and special purchases) and processing and management of all Head Office communications to stores in relation to merchandise handling and processing. I worked more closely with Ms Schultz when she was in the position of Merchandise Manager. I assumed responsibility of the management side of the role in relation to workflow and prioritisation of tasks for the team to lighten the workload for Ms Schultz and to take off some of the pressure. I also changed the reporting of the distribution staff so that they reported directly to me, rather than the Merchandise Manager (i.e. Ms Schultz).
15.Mr Besim also oversaw some of Ms Schultz's duties as a Merchandise Manager. He oversaw the duties relating to PR purchases and staff clothing allowances. However, these were ad hoc duties of the position. As such, there was no formal routine reporting from the role of Merchandise Manager to Mr Besim.
16.Natalie Sawan joined Head Office as a Merchandise Assistant in early October 2011 to effectively replace Ms Schultz while she was acting Merchandise Manager. Ms Sawan was already employed by Scanlan & Theodore in the South Yarra Retail Store as a Stock Room Manager. Given her experience, we thought she would be a good fit for our team during Ms Ratcliffe's maternity leave. Ms Sawan joined the Head Office team also initially on a temporary basis.
17.I refer to paragraph 21 of Ms Shultz's affidavit. Ms Schultz asserts that I approached her to ask about her interest in taking on executive planning duties. She says that I indicated that the role would be a promotion. Ms Schultz has filed a general protections application in the Fair Work Commission in relation to these proceedings. A true copy of Ms Schultz's general protections application, dated 1 August 2012, is attached to this affidavit and marked 'KH-3'. At paragraph
4 of her general protections application, Ms Schultz asserts that I offered her a promotion to a planning role.18.I deny the allegations in both the affidavit and the general protections application. Ms Schultz was not offered a promotion and was not offered employment in any other planning role or otherwise. There were no vacant roles in the business at that time. In around March 2012, Mr Besim and I had a discussion about succession planning in the business. I had a conversation with him about my workload and spoke to him about getting some help from employees in the Warehouse. I spoke to Ms Schultz about whether she had any interest in to taking on some of my duties as part of her role as Merchandise Manager. Ms Schultz said that she didn’t feel comfortable with taking on planning duties and that she wasn't interested as she thought it was an intimidating role. I accepted her position and I did not speak with Ms Schultz about this again.
19.In or around April 2012, Ms Ratcliffe informed me that she wished to return to work following her period of maternity leave. Ms Ratcliffe said that she wanted to come back to work on a part-time basis, so we structured a role for her around these requirements. In May 2012, I spoke with Ms Sawan and Ms Schultz about Ms Ratcliffe's return to work.
I told them that Ms Ratcliffe wanted to come back on a part-time basis and that she would return to work in the position of Merchandise Assistant. We discussed how the duties of the Merchandise Assistant position would then be shared between Ms Sawan and Ms Ratcliffe. I told Ms Sawan that we would keep her in the Head Office on a more permanent basis as an ongoing casual employee. I also told Ms Schultz that her role as Merchandise Manager would become permanent. Ms Schultz seemed comfortable with that. I refer to paragraph 24 of Ms Schultz's affidavit and agree with Ms Schultz's assertions as to what took place at the meeting.
Discussions with Ms Schultz about her pregnancy
20.On or around 16 March 2012, Ms Schultz told me that she was pregnant. Ms Schultz said that she wanted to let me know so that I could bear her pregnancy in mind when thinking about staffing. Ms Schultz and I had a fairly long conversation at that time. I have two children and I spoke with Ms Schultz about my family and about work-life balance. Ms Schultz and I discussed maternity leave. I asked her how long she thought she might take. Ms Schultz said she was unsure. I told her that it was a personal choice I said she might find that she loves being at home or she might find that she was really wanting to come back to work. I told her she needed to make that decision in her own time. In my experience, employees at Scanlan & Theodore who have taken maternity leave have taken anywhere between 6 weeks to 12 months off as maternity leave.
21.I asked Ms Schultz if it was okay for me to tell Mr Besim in confidence about her pregnancy. She said it was okay and that she would also tell him herself at the time that a formal announcement could be made. I told Mr Besim that Ms Schultz was pregnant some time shortly after this. I was talking to him about Ms Ratcliffe's return from maternity leave and mentioned that Ms Schultz was pregnant. I told Mr Besim that Ms Schultz would come and tell him herself at some stage.
22.On or around 20 April 2012, I spoke with Ms Schultz to let her know that Mr Besim was going on holidays. Mr Besim was taking approximately one week's leave and his last day in the office was 20 April 2012. I told Ms Schultz about Mr Besim's upcoming leave because she had previously told me that she wanted to tell Mr Besim personally about her pregnancy at around the time that she announced it to others. I refer to paragraph 33 of Ms Schultz's affidavit. Ms Schultz asserts that I told her to tell Mr Besim about her pregnancy. This is incorrect. I had only told Ms Schultz that Mr Besim was taking leave, in case she wanted to tell him about her pregnancy herself before he went on leave.
23.I do not recall exactly when, but at some stage in around May or June 2012, I asked Ms Schultz when she was planning to take maternity leave and how long she intended to take it for. She said that she would most likely take leave towards the end of September 2012 or the start of October 2012 for at least 6 months, but possibly longer. At around this time I was looking at staffing and was also making arrangements for Ms Sawan, who was taking 8 weeks annual leave. Aside from this conversation, I do not recall discussing Ms Schultz's maternity leave with her at any other time during her employment.
24.I refer to paragraph 50 of Ms Schultz's affidavit. Ms Schultz asserts that from around 29 June 2012, my attitude towards her changed. She says that I became cold, distant and hostile towards her and treated her comments with disdain. She also says that I refused to make eye contact with her.
I deny these allegations. Our relationship did not change.
I never had any conflict with Ms Schultz in the office and
I was not bothered by her taking sick leave. Ms Schultz and
I had a professional working relationship both before and after 29 June 2012.
Ms Schultz's period of sick leave
25.On 24 June 2012 at 8.29pm, I received a text message from Ms Schultz saying that she was unwell and was not sure if she would be well enough to come in to work the following day. I replied to Ms Schultz's text message and said 'Ok, thanks for letting me know. Hope you feel better'.
26.The following day on 25 June 2012, Ms Schultz sent me another message at 3.29pm. She said that she had just been to the doctor and was told she had a viral infection. She said that she had been told to stay home the following day, but that she thought she would be okay if she rested. I responded to her message and said 'No worries. See how you feel tomorrow. Hope you can get some rest'. A true copy of the text messages between Ms Schultz and me from 24 and 25 June 2012 are attached to this affidavit and marked 'KH-4'.
27.Later that day, at approximately 7.00pm or 8.00pm, I received a telephone call from Ms Schultz. Ms Schultz told me that she was just leaving the physiotherapist as she had sprained her back and that she would not be in for the next couple of days. I said words to the effect of 'Okay, thanks for letting me know'. I asked her to send through her medical certificate, as Mr Besim had previously advised all staff that they were required to provide medical certificates if they were absent from work due to illness. I refer to paragraph 46 of Ms Shultz's affidavit. Ms Schultz asserts that I became quite irritated after she called to advise me that she had hurt her back. I deny this allegation. I only spoke to Ms Schultz for a minute or two and I was not at all irritated that she was unwell.
28.On 26 June 2012, Ms Schultz sent through a copy of her medical certificate. A true copy of Ms Schultz's email dated 26 June 2012 with the attached medical certificate dated 25 June 2012 is attached to this affidavit and marked 'KH-5'. I responded to Ms Schultz's email shortly after I received it and thanked her for sending through the certificate. I also said that I hoped she felt better soon. A true copy of my email dated 26 June 2012 is attached to this affidavit and marked 'KH-6'.
29.I refer to paragraph 12 of Ms Schultz's affidavit. Ms Schultz states that when she required a day of sick leave and had to inform me, she did so with a lot of trepidation because her news was met with a distinct lack of sympathy and usually irritation and annoyance. I deny that I was unsympathetic, that I was annoyed or irritated and that I displayed annoyance or irritation by Ms Schultz taking sick leave. I responded to Ms Schultz's text messages by saying that I hoped she felt better.
30.I refer to paragraph 24 of Ms Schultz's statement of claim. Ms Schultz alleges that the Respondent perceived her absence from work between 25 and 28 June 2012 to be because of her pregnancy. I did not know or have reason to believe that Ms Schultz was sick because of her pregnancy. Ms Schultz had initially called in sick because she had the flu. Following that, she informed me that she had sprained her back. Ms Schultz's email of 26 June 2012 and the attached medical certificate also referred to a back injury.
Meeting with staff on 6 July 2012
31.On 6 July 2012, Mr Besim held a meeting with staff from the Warehouse Department. I attended the meeting along with other members of staff who worked in the warehouse. Mr Besim called the meeting to advise staff that Mr Dean Gunning, Fabric Warehouse Manager, had resigned. He told everyone that Mr Gunning's position would not be replaced and that we would need to work together to take on the duties of his position. Mr Besim also spoke about the need for changes to the business, including the need for more casual employees so that we had a more flexible workforce. Mr Besim also spoke about the fact that Scanlan & Theodore was not trading as we had budgeted. He noted that there had already been a number of redundancies earlier in the year and said that there could be more. The meeting went for around 30 minutes.
32.I refer to paragraph 52 of Ms Schultz's affidavit, Ms Schultz asserts that Mr Besim discussed a new store opening in the CBD. During the meeting, I asked Mr Besim whether the new city store would replace our existing Little Collins Street Store. Mr Besim said that he was unsure what was happening with the Little Collins Street Store.
33.I refer to paragraph 54 of Ms Schultz's affidavit. Ms Schultz asserts that Mr Besim and Mr Smith had a heated discussion about staffing and that I interjected to deflate the discussion between Mr Smith and Mr Besim. This is not correct. I recall Mr Smith asked Mr Besim about staffing during out busy period leading up to the launch of our summer season. He said words to the effect that 'If I can't get extra help I'll crack it.' He was laughing and joking when he said this.
I did not feel that I needed to deflate the situation, as the conversation between Mr Smith and Mr Besim was clearly light hearted.
Termination of Ms Schultz's employment
34.On 10 July 2012, at some time in the morning, Mr Besim told me that he had spoken to Gary Theodore, Director, and that he (Mr Besim) had decided to make Ms Schultz's position redundant. I don’t recall Mr Besim talking to me about who would take over Ms Schultz's duties. I assumed that Ms Schultz's workload would be absorbed and redistributed among the Merchandise Team, which consists of me, Ms Ratcliffe and Ms Sawan. This is what happened when Mr Gunning resigned. His duties were redistributed among the Distribution Team, which I also oversaw.
Mr Besim said that all teams within the Head Office were being looked at. I told Mr Besim that I supported whatever decision he needed to make for the business.
35.Mr Besim met with Ms Schultz that afternoon. After the meeting finished, I met Ms Schultz downstairs. Ms Schultz was downstairs with Mr Smith. I went downstairs at around 5.20pm. I told Ms Schultz that I was sorry to hear that she was leaving. I waited a little while whilst Ms Schultz attended to personal things on her computer. After approximately 10 minutes, I said to Ms Schultz words to the effect 'I'm sorry Mon, but you need to log off your computer'. Ms Schultz said that she was just deleting personal emails or personal contacts. Ms Schultz's husband picked her up from work at around 6.00pm. Mr Smith and I helped her carry her belongings to her car and I hugged her and wished her all the best when she left.”
An employer may take adverse action against an employee by dismissing the employee, or by injuring the employee in his or her employment, or by altering the position of the employee to the employee’s prejudice, or by discriminating between the employee and other employees of the employer.
Section 351(1) of the FW Act provides:
“An employer must not take adverse action against a person who is an employee, or prospective employee, of the employer because of the person’s race, colour, sex, sexual preference, age, physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin.”
In essence it is necessary for the applicant to first establish either that she has a workplace right or an attribute covered by s.351(1) of the Act and that she has suffered adverse action.
In relation to this allegation (like allegation 2) the applicant’s claim was also undermined by her evidence in cross examination. The applicant’s claims regarding her working relationship or reporting requirements to Mr Besim revealed a tendency to embellish the facts. An example in this regard is her responsibility for processing promotional vouchers which appeared on all of the evidence to be more ad hoc than she had previously claimed.
Mr Besim’s evidence in cross examination bore out his affidavit evidence that he didn’t encourage people to come to work if they were sick and that his emails regarding sick leave were for legitimate administrative and workforce planning purposes. Mr Besim’s evidence in cross examination reinforced his denial of the claim he was “less friendly” to the applicant.
The evidence in relation to this allegation was that Mr Besim denied that he treated the applicant differently or unfavourably at any time in her employment.[28] This denial was not disturbed in cross-examination.[29]
[28] Affidavit of Mr Besim filed 20 June 2013, exhibit R2 [23]-[27].
[29] Transcript 19 September 2013 p12 line 8 to 40.
Mr Besim’s evidence was supported by Ms Ratcliffe, who gave evidence that she did not notice any change in Mr Besim’s attitude towards the applicant during her pregnancy and did not recall the applicant making any complaints to her about the way she was treated by Mr Besim or Ms Hussain.[30] Ms Ratcliffe denied that she said to the applicant words to the effect, “Don’t worry Mon, it’s not personal. He did the same thing to me when I was pregnant.” This evidence was not shaken in cross-examination.[31]
[30] Affidavit of Ms Ratcliffe filed 20 June 2013 marked exhibit R6 at [26].
[31] Transcript 19 September p100 line 10 to 17.
Ms Sawan also gave evidence that she did not notice any change in attitude towards the applicant from Mr Besim during the applicant’s pregnancy.[32] Ms Sawan was not challenged on this evidence. Ms Sawan also gave evidence before the Court which had the unerring ring of veracity to it that she would not push herself to go to work.[33] There was no culture of intolerance to sick leave made out on the evidence before the Court.
[32] Affidavit Ms Sawan filed 20 June 2013 marked exhibit R8 at [16].
[33] Transcript 20 September 2013 p120 line 19.
Ms Sawan’s evidence on the issue of the claim made by the applicant of some alleged intolerance by the respondent to employees taking sick leave was in my view decisive.[34] Ms Sawan’s evidence and her repudiation of the applicant’s claim in that regard were consistent with the evidence given by Ms Hussain and Ms Ratcliffe.
[34] Transcript 20 September 2013 p120 line 19.
Overall the submissions made on behalf of the applicant appeared to elevate the applicant’s perception of events to a level sufficient to amount to adverse action. Having regard to all the evidence in relation to this allegation, in particular the evidence of Ms Sawan, Ms Ratcliffe and that Mr Besim’s evidence on this issue had the ring of veracity to it and I am not satisfied the applicant was treated with hostility, differently or unfavourably.
The onus was on the applicant to prove, on the balance of probabilities having regard to the seriousness of the offence, that the respondent engaged in “adverse action” against her within the meaning of s.342(1) of the FW Act.
On the evidence before the Court I am not satisfied the application has made out the necessary objective facts to provide a basis for this part of her claim and accordingly this allegation (allegation 3) should be dismissed.
Allegation 4
In submissions filed prior to the trial the applicant’s submissions in relation to allegation 4 were:
“Termination
36.The respondents admit that the applicant was terminated. Accordingly, the respondent dismissed the employee for the purpose of Item 1(a) of s 342(1) of the FW Act.
…
Termination
40.It is not clear from the respondent’s own material who was involved in making the decision to terminate the applicant. In his affidavit, Mr Besim refers to “Mr Theodore and I discuss[ing] the possibility of further redundancies depending on the financial performance of the business”. He refers to discussions, opinions and decisions around the redundancies by using the plural “we” presumably referring to Mr Theodore and himself.
41.Mr Theodore is and was the sole owner of the respondent. Mr Besim reported directly to him. It is clear from Mr Besim’s evidence that Mr Theodore was intimately involved in the decision to terminate Ms Schultz. No evidence has been filed by the respondent as to Mr Theodore’s reasons for acting as he did. If the court is satisfied that Mr Theodore was the (or one of the) operative minds in making the decision to dismiss the applicant, or that he played an essential part in the ultimate decision to terminate the applicant, it is submitted that the respondent will be unable to discharge its onus of proof.
42.Further, it is understood that Mr Besim’s evidence will be that the reasons for making Ms Schultz redundant included the financial performance of the respondent. The respondent has filed evidence in support of this proposition. This evidence is yet to be tested. In any event, given the operation of ss 360 and 361, it is not sufficient for the respondent establish that Ms Schultz’ redundancy occurred because of the financial performance of the respondent. The FW Act recognises that adverse action may have multiple causes. Accordingly, the respondent must prove that neither Ms Schultz’ pregnancy and workplace rights were reasons for her redundancy and termination. It is submitted that the real reason that Ms Schultz was selected for redundancy included that she was pregnant and intended to take parental leave.
F.CONCLUSION
43.It is submitted that the respondent treated Ms Schultz differently and unfavourably and ultimately made her redundant because she was pregnant and because she intended to take parental leave. As recently noted by Gray J in NTEU v RMIT:
Employers must understand that making use of redundancy as a pretext for getting rid of an undesired employee is not an option, if the reasons for wishing to get rid of that employee would be proscribed by the Fair Work Act.” (footnotes in original omitted)
In opening Counsel for the applicant described this allegation as the allegation which was at the heart of the case.[35] Counsel for the respondent acknowledged that the termination of the applicant’s employment amounted to adverse action and that the burden fell to his client to prove that the reason or a part of the reason for the applicant’s termination was not a prohibited reason.[36]
[35] Transcript 18 September 2013 p14 line 1-2
[36] Transcript 18 September 2013 p15 line 9
The applicant in oral submissions after the close of evidence submitted the Court should not accept the respondent’s evidence as to the reasons for the applicant’s termination, as it was submitted:
a)the applicant’s duties couldn’t be and weren’t done by Ms Hussain after her termination;
b)the timing of the decision by Mr Besim to terminate the applicant’s employment was illogical and contrary to good workforce planning;
c)the selection of the applicant for redundancy ignored the “philosophy” it was said existed at the respondent’s head office in relation to its warehouse function to prefer the use of casuals;
d)the redundancy of the applicant was “distinguishable” from other redundancies by the respondent at its head office over the preceding period;
e)the termination of the applicant was contrary to the claim of the respondent to be supportive of employees who are pregnant; and
f)the respondent had not made out it’s case that the decision was driven by an economic imperative.
In submissions filed prior to the trial the respondent’s submissions in relation to this allegation were:
“Allegation 4
37.The Respondent denies that it terminated the Applicant’s employment by reason of her pregnancy or any other workplace right that she had, exercised or proposed to exercise, or for the purposes of preventing the Applicant exercising a workplace right.
38.The Respondent terminated the Applicant’s employment by reason of redundancy.
39.It is well established what constitutes a termination by redundancy. In Virgin Blue, Judge Burnett said at [247]:
“In Jones v Department of Energy and Minerals (1995) 60 IR 304, Ryan J provides further guidance on the meaning of redundancy as follows:
‘... it is within the employer’s prerogative to rearrange the organisational structure by breaking up the collection of functions, duties and responsibilities attached to a single position and distributing them among the holders of other positions, including newly-created positions ... One illustration of it occurs when the duties of a single, full-time, employee are redistributed to several part-time employees. What is critical for the purpose of identifying a redundancy is whether the holder of the former position has, after the re-organisation, any duties left to discharge.’”
40.The decision that the Applicant’s position was to be terminated by reason of redundancy was made predominantly by Besim. However, the Respondent accepts that Theodore was consulted by Besim in relation to this decision. Therefore, the evidence of Theodore may be relevant.
41.The evidence in support of the fact that the reason for the decision to terminate the Applicant’s employment was solely redundancy, and not by reason of the Applicant’s pregnancy, will be as follows:
a.Direct evidence of Besim that the reason for the termination of the Applicant’s employment was redundancy (Besim [45] and Besim's supplementary affidavit [3]). Besim communicated this decision and the reason for it to Hussain immediately after making the decision (Hussain [34]);
b.Direct evidence of Theodore that the reason for the Applicant’s termination was redundancy (Theodore [8] – [9]);
c.The objective evidence that the performance of the Respondent’s business had, in 2012, experienced a downturn (Besim [30] and Exhibit SB-5; Theodore [7]). This resulted in Besim and Theodore discussing redundancies and identifying middle management roles that could be made redundant (Besim [32]; Theodore [7]);
d.That prior to the Applicant’s redundancy, there had been six other employees of the Respondent who had either been made redundant, or had resigned and not been replaced (Besim [31]-[38] and Exhibit SB-6);
e.That on 6 July 2012 (prior to the termination of the Applicant’s employment), Besim conducted a meeting where he discussed the possibility of redundancies at the Respondent (Besim [39]-[44]; Hussain [31]-[33]; Sawan [18]-[20]);
f.That at the meeting between Besim and the Applicant on 10 July 2012, Besim told the Applicant that her employment was being terminated by reason of redundancy (Besim [46]-[61] and Exhibit SB-8; Sawan [11]-[23] and Exhibit RA-4);
g.Following the termination of the Applicant’s employment by reason of redundancy, her duties were split up and performed by Ratcliffe, Sawan and Hussain (Hussain [37]; Ratcliffe [29]; Sawan [21]-[23]); and
h.The Respondent has a long history of female employees taking maternity leave and subsequently returning to work (Besim [65]-[66]), and supporting female employees during pregnancy and maternity leave (Hussain [39]-[41]; Ratcliffe [21]-[22]).
42.Where the evidence establishes that an employee’s termination was by reason of redundancy, and for no other reason, the Court ought find that an employer has not contravened the adverse action provisions.” (footnotes in original omitted)
The respondent’s closing submissions in relation to this allegation were set out at paragraphs [54] to [75] of exhibit R9 as follows:
“54.The Respondent denies that it terminated the Applicant’s employment by reason of her pregnancy or any other workplace right that she had, exercised or proposed to exercise, or for the purposes of preventing the Applicant exercising a workplace right.
55.The Respondent terminated the Applicant’s employment by reason of redundancy.
56.It is well established what constitutes a termination by redundancy. In Virgin Blue, Judge Burnett said at [247]:
“In Jones v Department of Energy and Minerals (1995) 60 IR 304, Ryan J provides further guidance on the meaning of redundancy as follows:
‘... it is within the employer’s prerogative to rearrange the organisational structure by breaking up the collection of functions, duties and responsibilities attached to a single position and distributing them among the holders of other positions, including newly-created positions ... One illustration of it occurs when the duties of a single, full-time, employee are redistributed to several part-time employees. What is critical for the purpose of identifying a redundancy is whether the holder of the former position has, after the re-organisation, any duties left to discharge.’”
57.The decision that the Applicant’s position was to be terminated by reason of redundancy was made predominantly by Besim. However, the Respondent accepts that Theodore was consulted by Besim in relation to this decision. On 9 July 2012, Besim called Theodore while Theodore was overseas in Greece. The purpose of the call from Besim’s perspective was to inform Theodore of the financial position of Scanlan & Theodore and to express his own view that, by reason of this financial position, there was a need to make another position redundant at Scanlan & Theodore. By 9 July 2012, Scanlan & Theodore was $2,674,489 behind budget (in sales). Prior to this telephone conversation, Besim considered which position ought be made redundant. He reached the conclusion that the position of Merchandise Manager ought be made redundant as those duties could largely be absorbed by Hussain in her role as Planning Manager and other employees assuming some of the duties.
58.During the conversation, Theodore and Besim discussed the sales figures for the month and agreed that there was a need to make another position redundant. Besim presented Theodore with the proposition that the Applicant’s role as Merchandise Manager ought be made redundant and the basis upon which Besim formed that view. Theodore agreed with Besim.
59.There was no discussion of the Applicant’s pregnancy during this conversation. The fact that the Applicant was pregnant or wanted to take maternity leave was not part of the reason for making the Applicant’s role as Merchandise Manager redundant. Theodore left the final decision and its implementation (in relation to terminating the Applicant’s position by reason of redundancy) to Besim (SB [45], SB Supp [2]-[5], GT [8]-[10]. See also [2T26:23-27:28(SB) and 2T66:34-46(GT)].
60.There was substantial and overwhelming evidence in support of the fact that the reason for the decision to terminate the Applicant’s employment was solely redundancy, and not by reason of the Applicant’s pregnancy or intention to take maternity leave (or in any way related to maternity leave). This evidence is set out below.
Direct evidence from the decision maker(s)
61.There was direct evidence of Besim that the reason for the termination of the Applicant’s employment was redundancy and not by reason of the Applicant’s pregnancy or anything to do with maternity leave (Besim [45] and Besim's supplementary affidavit [3]). This evidence was not disturbed in cross-examination [2T44:10-38(SB) and 2T47:43-46(SB)]. Besim communicated this decision and the reason for it to Hussain immediately after making the decision (Hussain [34]);
62.Further, there was direct evidence of Theodore that the reason for the Applicant’s termination was redundancy (Theodore [8] – [9]). Indeed, Theodore was not even aware that the Applicant intended to take maternity leave nor that she was pregnant [2T57:18-27(GT) and 2T69:19-21(GT)].
“Diabolical” sales figures in 2012
63.The objective evidence that the performance of the Respondent’s business had, in 2012, experienced a significant downturn. Despite budgeting for growth in sales for the 2012 calendar year, by 30 June 2012, Scanlan & Theodore sales had decreased by approximately 10% from the winter season in the 2011 calendar year. (Besim [30] and Exhibit SB-5; Theodore [7] See also 2T14:24(SB) and 2T20:30-33(SB)). In evidence, Besim said:
“It – it came on basically from – it basically started the year before to be completely honest. We were – didn’t get off to a good start with our sales at the end of 2011 and we had to massively reduce our prices to – just to get to some sort of reasonable sales figure and we had a lot of stock so – and then when – basically we – we know how we’re going to go when we start the season and we start the season in February and we had the worst – we had the worst start to a season ever. So diabolical that it didn’t even make a dint to the figures. Usually we have an increase from – from – from your last week of sale to the first week of the new season you usually have at least double the figures. We just didn’t have any traction. Nothing happened which was – for us that’s why I used the word diabolical to – to be selling summer product in February and then to deliver, repaint the stores, polish your – polish your terrazzo. All the girls get their hair cut and they get their make-up done, new music, let’s launch the season, nothing happened, nothing happened. There was no increase in figures. That to us after Gary being in business for 26 years, that had never happened to us before and to experience what we experienced in 2009 we were very concerned.” [2T28:4-18]
64.This resulted in Besim and Theodore discussing redundancies and identifying middle management roles that could be made redundant (Besim [32]; Theodore [7]).
Previous redundancies and unfilled resignations in 2012
65.Prior to the Applicant’s redundancy, there had been five other employees of the Respondent who had either been made redundant, or had resigned and not been replaced (Besim [31]-[38] and Exhibit SB-6). These included:
a.on 22 January 2012, one of Scanlan & Theodore’s five Pattern Makers, Roslyn Jack (Jack), resigned. Scanlan & Theodore did not replace Jack as a Pattern Maker. Therefore, one of the five Sample Machinists, who worked in tandem with a Pattern Maker, was also selected for redundancy [See also 2T21(SB)];
b.in March 2012, the position of Workroom Manager at Scanlan & Theodore was made redundant and the functions performed in this position were absorbed by the Product Manager at Scanlan & Theodore [See also 2T22(SB)];
c.in April 2012, the position of Quality Care Manager at Scanlan & Theodore was made redundant. The duties of this position were absorbed by the Production Manager [See also 2T23-24(SB)]; and
d.in late June or early July 2012, the Fabric Warehouse Manager (Dean Gunning) resigned. This position was not replaced [See also 2T80(KH)].
Meeting on 6 July 2012 warns of further redundancies
66.On 6 July 2012 (prior to the termination of the Applicant’s employment), Besim conducted a meeting where he discussed the possibility of redundancies at the Respondent. At this meeting, Besim advises staff that Dean Gunning, Fabric Warehouse Manager, had resigned and that his position would not be placed and that the team would need to work together to take on the duties of this position.
67.Besim discussed the fact that Scanlan & Theodore was not trading as well as it had budgeted and noted that there had already been a number of redundancies earlier in the year and says that there could be more (Besim [39]-[44]; Hussain [31]-[33]; Sawan [18]-[20]) See also 2T87:43(KH) and 2T20:9(SB)).
Termination meeting on 10 July 2012 confirmed redundancy as reason
68.At the meeting between Besim and the Applicant on 10 July 2012, Besim told the Applicant that her employment was being terminated by reason of redundancy. At the start of the meeting, Besim told the Applicant that the purpose of the meeting is to inform her that her position is to be made redundant, effective immediately. Besim told the Applicant that the decision to make her position redundant was purely financial and because of the financial performance of the business and tougher economic climate, particularly in the retail industry.
69.The Applicant tried to give Besim an application for parental leave. Besim told the Applicant that he did not need the application because it is not relevant to the discussion. The Applicant asked whether she was being made redundant because she was pregnant. Besim replied with words to the effect, “Absolutely not.” and reiterated that the decision was a financial one. Besim said that he was offended that she had suggested it was because she was pregnant. Besim told the Applicant that there had been a number of employees who had taken maternity leave and the decision had nothing to do with that. (Besim [46]-[61] and Exhibit SB-8; Sawan [11]-[23] and Exhibit RA-4).
70.At no stage during the meeting did Besim ask for the Applicant’s maternity leave paperwork. Besim was not even aware that the organisation had formal paperwork [T97:15(SB) and 2T34:7-10(SB)].
The Applicant’s former duties redistributed
71.Following the termination of the Applicant’s employment by reason of redundancy, her duties were split up and performed by Ratcliffe, Sawan and Hussain (Hussain [37]; Ratcliffe [29]; Sawan [21]-[23]). This evidence was confirmed in cross-examination [2T88:31-89:24(KH)]. The fact that Hussain subsequently reallocated many of these duties to her subordinates does not detract from the proposition that the former duties of the Applicant were performed by other employees and she was genuinely redundant. Hussain had autonomy to run her department as she saw fit [T83:33(SB)]. In this respect it is noted that both Ratcliffe and Hussain had previously performed the role of Merchandise Manager at Scanlan & Theodore [2T73:20-23(KH)].
Scanlon & Theodore have a history of supporting maternity leave employees
72.The Respondent has a history of female employees taking maternity leave and subsequently returning to work (Besim [65]-[66]), and supporting female employees during pregnancy and maternity leave (Hussain [39]-[41]; Ratcliffe [21]-[22]).
73.The Applicant attempted to allege through cross-examination that female employees going on maternity leave created an inflexibility to Scanlan & Theodore. This was consistently denied by the Respondent’s witnesses [2T19:27-20:2(SB) and 2T60:31-44(GT)]. Indeed, the Applicant herself obtained the role as Merchandise Manager on a maternity leave contract to replace Ratcliffe while she went on maternity leave (See exhibit KH-2 to Hussain’s affidavit). There was no evidence that this created any inflexibility for Scanlan & Theodore.
74.Ratcliffe gave evidence that when she told Besim that she was pregnant, he was very supportive and very excited for her. She told Besim at the time that she planned on taking around six months off as maternity leave, and Besim replied that it would be fine but it could be discussed further down the track. Ratcliffe found that the experience of going on maternity leave while employed at Scanlan & Theodore was a very easy process. Besim and Hussain were very supportive and accommodating. (JR [18]-[21]) This was not disturbed in cross-examination [2T98(JR)].
Conclusion
75.The evidence establishes that the Applicant’s termination was by reason of redundancy only and for no other reason. Scanlan & Theodore has discharged its evidentiary burden pursuant to sections 360 and 361 of the Fair Work Act 2009. In these circumstances the Court ought find that an employer has not contravened the adverse action provisions.”
The applicant acknowledged in cross examination there had been previous redundancies and other positions had not been replaced. The applicant also acknowledged that at the meeting on 6 July 2012, Mr Besim had told employees about financial problems with the business.
Mr Besim’s evidence in cross examination was consistent with the evidence in his affidavits about the “diabolical” state of the business in 2012 and that in June he was very worried. Mr Besim’s evidence and that of Mr Theodore in cross examination was notable for how clear they both were that having employees on maternity leave did not present a problem for the business.
Mr Besim’s evidence in cross examination consistent with his affidavit material explained the basis for his decision to make the applicant’s position redundant and why he was confident Ms Hussain would be able to absorb those duties previously done by the applicant in the area she managed. The evidence of Ms Hussain and Ms Sawan corroborated this. Ms Hussain’s evidence in cross examination was notable for her response that she did “what had to be done” and the increased duties are shared across employees in the area.
Mr Besim was definitive in answer to questions in cross examination that the applicant’s pregnancy (or other prohibited reason) had “nothing to do with the decision” on the applicant’s redundancy.
The applicant’s submission that the redundancy of the applicant was distinguishable appeared to miss the point. The evidence is that whether other employees resigned or were made redundant in most cases, their positions weren’t replaced by the respondent.
The decision that the applicant’s position was to be terminated by reason of redundancy was made by Mr Besim. Whilst Mr Theodore was consulted by Mr Besim in relation to this decision, the evidence was that the decision was made by Mr Besim.
Mr Besim told Mr Theodore that, by reason of the respondent’s sales and financial position, there was a need to make a further position redundant. Mr Besim had considered which position ought be made redundant. He reached the conclusion that the position of Merchandise Manager ought be made redundant as those duties could largely be absorbed by Ms Hussain in her role as Planning Manager and other employees assuming some of the duties.
Mr Besim’s evidence as to the reasons he gave for why the applicant’s role as Merchandise Manager ought be made redundant and the basis upon which Mr Besim formed that view were not shown to be wanting in cross examination.
Ms Armstrong’s evidence corroborated that given by Mr Besim in a number of important respects in relation to this allegation. Ms Armstrong’s evidence was that Mr Besim had said during the meeting on 10 July 2012 that the decision was “purely financial”.[37]
[37] Transcript 20 September 2013 p112 line 23.
Ms Armstrong refuted the applicant’s claim that Mr Besim had thrown a pen to her (Ms Armstrong) during the meeting and acknowledged some amendments to the minutes of the meeting had been made afterwards by Mr Besim.
The evidence given on behalf of the respondent was that the fact that the applicant was pregnant or had a right to unpaid maternity leave or proposed to or exercised a right to request to take maternity leave or had refused to commit to 6 months maternity leave was not the reason or part of the reason for making the applicant’s role as Merchandise Manager redundant.
Importantly for present purposes the respondent called the two persons involved in the decision to terminate the applicant. The evidence of those witnesses was unshaken, and confirmed by certain financial and other records produced. Mr Besim gave evidence and was cross examined. This was the “direct evidence of a decision-maker as to state of mind, intent or purpose” which was referred to in Barclay in the passages set out above. It was also the evidence that there were no additional reasons.
There was substantial and objective evidence in support of the respondent’s position that the reason for the decision to terminate the applicant’s employment was solely redundancy.[38]
[38] see attachments to Mr Besim’s affidavit and data on decline in sales figures
To the extent that the appellant submits that the Court should take a broader view of the sequence of events that occurred that led to the termination of the applicant’s employment due to redundancy, in order to see through some thin veil covering some carefully designed process to hide the allegedly real and prohibited reason or reasons, I do not consider that the evidence supports such a conclusion.
When consideration is given to all the circumstances here, the respondent no longer wished for the applicant’s role to be performed. As was identified in Jones v Department of Energy and Minerals (1995) 60 IR 304, the fact that other functions she undertook were split between other employees is not relevant in determining this case.
In my view, the respondent has discharged the onus of proof upon it. The respondent has demonstrated that it did not take the adverse action complained of by the applicant (her dismissal) for a proscribed reason or for a reason that included a proscribed reason.
Conclusion
For the reasons set out above the application should be dismissed.
Given s.570 of the FW Act any application for costs is to be filed within 14 days and any response 14 days thereafter.
Any application for costs will be determined on the papers unless the parties request otherwise. For the reasons set out above there will be orders as set out at the beginning of these reasons.
I certify that the preceding one hundred and sixty-two (162) paragraphs are a true copy of the reasons for judgment of Judge O’Sullivan
Date: 18 October 2013
Key Legal Topics
Areas of Law
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Employment Law
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Negligence & Tort
Legal Concepts
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Breach
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Causation
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Duty of Care
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