[2021] FWC 1414

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Shane McGrath
v
Waco Kwikform Limited
(U2020/12955)

COMMISSIONER SIMPSON

BRISBANE, 18 MARCH 2021

Application for unfair dismissal remedy.

[1] On 29 September 2020, Mr Shane McGrath (Mr McGrath/the Applicant) made an application to the Fair Work Commission (the Commission) pursuant to s.394 of the Fair Work Act 2009 (the Act) alleging that his dismissal by Waco Kwikform Limited (the Respondent) was harsh, unjust or unreasonable.

[2] The matter was listed for a conciliation before a Commission Conciliator on 15 October 2020 where it did not settle. The matter was then referred to me for arbitration and I listed it for Hearing on 4 February 2021 by video using Microsoft Teams. At the commencement of the proceedings both parties agreed the matter should proceed as a Hearing rather than a determinative conference.

[3] Mr McGrath represented himself at the Hearing and the Respondent sought leave to be represented by Mr Jimmy Li of National Workplace Lawyers. After hearing submissions from both sides, I granted leave for Mr Li to represent the Respondent.

Background

[4] Mr McGrath was employed by the Respondent from 29 October 2018 until his dismissal on 11 September 2020.

[5] Mr McGrath said he was employed as ‘Sales Representative – Business Development Executive’, the Respondent said he was employed as a ’Salesperson’.

[6] In its Form F3 – Employer response, the Respondent stated it had 550 employees and on that basis the Small Business Fair Dismissal Code does not apply. The Respondent also stated in its Form F3 response that Mr McGrath had been subject to a first Performance Improvement Plan (PIP), a second PIP which was extended, effectively being a third PIP, and was also subject to a first written warning and final warning regarding his failure to improve his performance. The Respondent said due to a failure of Mr McGrath to improve his performance despite the various improvement plans and warnings, the Respondent proceeded with termination of his employment. The Respondent stated it had afforded Mr McGrath procedural fairness in all of the circumstances.

[7] Relevantly, the letter of Termination of Mr McGrath’s Employment provided:

“14 September 2020

Private and Confidential

Mr Shane McGrath
[address redacted]

Dear Shane,

Re: Termination of Your Employment

This letter confirms the outcome of the Show Cause meeting held between you and Waco Kwikform Ltd (the Company) in which you were advised that your employment was to be terminated for failing to meet the performance expectations set by the Company.

Since 17 February 2020 you have been on a Performance Improvement Plan designed to assist you in improving your performance and supporting you to achieve your expected performance targets. The PIP was due to conclude in May 2020.

Following meetings with you in May and June 2020 the Company accepted there were extenuating circumstances which may have contributed to your unsatisfactory performance and as such, agreed to revise the PIP to allow you a further two (2) months to achieve a satisfactory level of performance.

The new PIP commenced on 01 July 2020 and concluded on 31 August 2020.

The new PIP contained 9 areas of improvement which needed to be addressed.

You attended a meeting with the Company on 07 September 2020. In the meeting you discussed with the Company your full PIP results against the targets. While we acknowledge some targets were achieved key targets were well below expectations.

You were invited to attend a meeting on 11 September, 2020 at 9:30am in our Brisbane office to provide you an opportunity to explain why you had failed to meet the objectives of the PIP.

You attended the meeting 11 September 2020 with your support person who you identified as your Father-in-Law.

Attending from the Company was myself, and Simon Humphrey, Commercial Director.

By way of background, Simon summarised the matter and your performance results achieved in the PIP.

Your Explanation.

You advised the Company that you were surprised by the invitation letter to attend this meeting as you had thought that Monday’s review meeting discussion had been positive.

You stated that you believed you had performed sufficiently over time and that you had covered your cost to company.

You also stated that you were about to bring in $1.2M worth of work in addition to the $300K already won.

You claimed that the sales targets were not achievable.

You also claimed that you had struggled to get enough time with Matthew Noonan, Estimator to assist you with your quotes.

Primary Decision

The Company considered your response but you were subsequently advised that your explanations were not acceptable for your continued poor performance.

You were advised that you clearly did not hit your revenue targets set and agreed with you at the commencement of the PIP.

You were also advised that you would not be able to hit your future revenue targets based on your existing pipeline of opportunities.

You were advised that you had also failed to meet your quote/tender targets as set and agreed in the PIP and that this activity had fallen further in the month of August.

You were also advised that your reasons for not being able to have time with Matthew was not acceptable. As an experienced sales person, time management is something that is in your control. Blaming others for your poor time management is not acceptable.

For these reasons we advised you that we were now considering termination of your employment for failing to meet the performance expectations set by the Company and as agreed with you.

You were also advised that prior to making our final decision the Company would be providing you with the opportunity to Show Cause as to why your employment should not be terminated for unsatisfactory performance.

You were provided the opportunity to adjourn the meeting and return at a later agreed time or to continue with the meeting after taking a few moments to prepare your response.

You decided to take a few moments to prepare your response.

The Show Cause Discussion

Upon reconvening the meeting you stated to the Company that you wanted to remain with Waco and that you think you can be successful and we should be able to all move on.

The Company adjourned the meeting to discuss your response.

Our Final Decision

Upon reconvening, you were advised the Company had considered your response but, given your reply against the facts, we had no alternative but to proceed with termination of your employment.

We stated our justification for our decision was, you have continuously failed to maintain a satisfactory level of performance in your employment. The Company has supported you for over 9 months to help you understand the performance level expected and provided you ample opportunity to be able to demonstrate you could achieve the standard of performance.

Your response that you think you can be successful does not correlate with your demonstrated performance and effort to date.

We also note the Final Warning issued to you on 06 May 2020 where you were advised that continued unsatisfactory performance on your part or failure to meet the objectives of the PIP may result in termination of your employment.

For these reasons we feel our decision is appropriate and justified in the circumstances.

You will be paid your notice period in lieu and your employment is terminated effective 11 September 2020. Your payment in lieu of notice and any other entitlements, and unpaid hours worked will be paid into your nominated bank account in the next applicable pay cycle.

If you have any questions about this this (sic) letter please contact me directly.

Yours sincerely,

Dean Stephenson
Regional Sales Manager, South East Queensland”

[8] Mr McGrath accepted he was paid four weeks’ notice. Directions were issued for filing of materials in this matter, and it was scheduled for Hearing on 4 February 2021.

[9] As part of Mr McGrath’s material he raised a claim for reimbursement of wages for what he claimed was a period of time of reduced wages in 2020 in the context of COVID-19. It was explained that the period of reduced wages ended well before the time of the termination. The Respondent raised an objection to this material and said it was a complex issue beyond the jurisdiction of the Commission. I indicated that if Mr McGrath wanted to refer to the issue on the basis that it was related to his dismissal it could be considered, however the Commission did not have jurisdiction to provide a remedy in relation to the claim of underpayment. Mr McGrath said it was relevant for the purpose of demonstrating there had been a downturn in the industry which was therefore relevant to sales targets. The parties were content to proceed on the basis.

LEGISLATION

“394 Application for unfair dismissal remedy

(1) A person who has been dismissed may apply to the FWC for an order under Division 4 granting a remedy.

Note 1: Division 4 sets out when the FWC may order a remedy for unfair dismissal.

Note 2: For application fees, see section 395.

Note 3: Part 6 1 may prevent an application being made under this Part in relation to a dismissal if an application or complaint has been made in relation to the dismissal other than under this Part.

(2) The application must be made:

(a) within 21 days after the dismissal took effect; or

(b) within such further period as the FWC allows under subsection (3).

(3) The FWC may allow a further period for the application to be made by a person under subsection (1) if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and

(b) whether the person first became aware of the dismissal after it had taken effect; and

(d) prejudice to the employer (including prejudice caused by the delay); and

(e) the merits of the application; and

(f) fairness as between the person and other persons in a similar position.”

“387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.”

SUMMARY OF SUBMISSIONS AND EVIDENCE

[10] Mr McGrath did not file a witness statement as such, however filed an Outline of Argument Merits 1 and a Response to the Respondent’s Submissions2 which he adopted as his evidence. Mr McGrath confirmed he did not seek reinstatement as a remedy but compensation under section 392. A number of video recordings were filed from the meeting that led to the termination of Mr McGrath and were variously admitted as exhibit 3 to exhibit 7.

[11] Mr McGrath accepted during his oral evidence that a key part of his role was to obtain new sales. Mr McGrath accepted this was achieved by sales targets however he claimed the “goal posts were changing” and the figures would change. He accepted that there was always a target but that nobody could say exactly what that figure was on multiple occasions. He claimed as a salesperson he had no idea what that target was because it kept changing and evolving and there was no exact target.

[12] Mr Andrew Heng, Human Resources Manager of the Respondent, filed a witness statement 3 in these proceedings.

[13] Mr Heng said Mr McGrath was employed from 28 October 2018 in the position of Sales Representative, based in Brisbane. He said that in his role, Mr McGrath was required to grow and promote the sale of Waco Kwikform products and services including, but not limited to, generating new business opportunities, qualifying leads, developing long-term customer relationships, implementing strategic plans and managing assigned customer accounts.

[14] Mr Heng said that at his commencement, as stated in the Applicant’s position description, he was expected to generate a minimum of $600,000 in sales revenue per year.

[15] Mr Dean Stephenson, Brisbane Branch Manager, filed a witness statement in these proceedings. 4

[16] Mr Stephenson’s evidence included that the sales function of the Respondent company generates leads by:

- Cold calling;

- Researching electronic project data subscriptions i.e., BCI, Estimate One, etc;

- Relationship selling; and

- Newspaper tenders/requests for quotation.

[17] He said that leads describe “future works” that have not yet been awarded to a “builder” and/or are “merely at design stage”. Leads become opportunities when a builder becomes the successful tenderer for a project. Opportunities are then assessed against a matrix, then tendered for by the Respondent and if it is successful, generate revenue for the Respondent.

[18] Mr Stephenson stated that the ‘relevant salesperson’ or sales representative of the Respondent is charged with identifying the leads, sourcing relevant documentation, and forming a relationship with the customer to not only quote the works, but also to get to the negotiating table to win the work on behalf of the Respondent.

[19] Mr Stephenson said that salesperson also has the responsibility of managing the won works, to ensure margins are maintained and the customer has a direct contact for disputes and any future variations or other matters.

[20] Mr Stephenson stated that Mr McGrath reported directly to him. He said Mr McGrath’s annual salary was $85,000, and in addition he was provided a company vehicle. Mr Stephenson stated that Mr McGrath’s total remuneration package, inclusive of base salary, vehicle, and superannuation was approximately $130,000 per annum.

[21] Mr Stephenson stated that as a salesperson, Mr McGrath was required to meet various targets, and in particular targets regarding the revenue he brought into the business.

[22] Mr Stephenson said that agreed budgets for the revenue a salesperson brings into the business are set prior to the commencement of each financial year, both at the branch and individual salesperson level. He said it is the responsibility of the individual salesperson to achieve the agreed numbers.

[23] Mr Simon Humphrey, Commercial Director of the Respondent, provided a witness statement. 5

[24] Mr Humphrey said the Brisbane branch reported through to him from 1 June 2020 and from that date he was ultimately responsible for the branch and was therefore actively involved in discussions with Mr Stephenson about its performance.

[25] Mr McGrath said the Respondent claimed in its submissions that as at 3/2/2020 the year-to-date target was $173,000 however his original contract stated it was $600,000. He also said the documentation for his second PIP in July 2020 provided targets were $45,000 per month however Mr Simon Humphry said in his statement that the target was$35K.

[26] Mr McGrath said it was also said in correspondence on 27 May 2020 that he was given a monthly target of $15,000 and a weekly target of $4000 in hire. Mr McGrath accepted that these figures appeared in correspondence he produced himself and he was aware of that target at that time.

[27] Mr McGrath was asked whether he had raised a concern about fluctuation in targets at the time in his letter to Mr Heng and he agreed he did not. Mr McGrath was asked to show where else in the material it shows he had brought this issue up. Mr McGrath referred to the statement of Mr Stephenson. 6 It was put to Mr McGrath that although he said the target was unfair, there was nothing to suggest he didn’t know what his target was. Mr McGrath indicated there was more evidence in the material that showed he had raised the issue, but it would take him time to find it in the material.

[28] It was put to Mr McGrath that there wasn’t much fluctuation between $173,000 per year and $15,000 per month. Mr McGrath stated that would be $180,000 and demonstrates how much it changes. Again, it was put to Mr McGrath there is not much difference between $173,000 and $180,000 in the scheme of things. Mr McGrath maintained this was a significant difference.

[29] It was put to McGrath that he was aware at that time that his target was around $173,000-$180,000 and he agreed. Mr McGrath was asked if he regularly tracked against this target and he answered no. When asked why he did not he said it was difficult to get reports. He said he asked to get reports, and although the target is in the CRM system, that is a different target and there are different factors that come into play. It was put to Mr McGrath that it didn’t make sense that the company would set targets but that he wouldn’t have the capacity to track them against the CRM system. Mr McGrath said across the year you can track your target but the goal posts change. Mr McGrath said the CRM system does track by month but not by day.

[30] Mr McGrath was asked if the target was for the financial year from July to June. Mr McGrath said there was no defined target set for the financial year.

[31] Mr McGrath accepted that his contract of employment included a target of $600,000 per year but he said he didn’t know what it alluded to but agreed that’s what the contract said.

[32] It was put to Mr McGrath by April 2020 he had been employed for about 18 months. Mr McGrath was asked how many sales he had made from the start of his employment to April 2020. Mr McGrath said it was about $65,000 and when he came back from paternity leave, he made sales of about $300,000.

[33] In written notes attached to the statement of Mr Stephenson’s statement 7 it records as follows:

“DS asked how many jobs SM had won during his 18/19 months employment – SM said 3, however could only remember two. DS reminded him that either way the projects were small at best and that the largest one that was still very small cost Waco $5k in Labour credits. DS had previously spoken to SM when it was discovered that SM had off hired the last part of the job (a stair access I believe) approximately 2 months prior to it being pulled down. SM responded with “this was part an agreed settlement” he had with the customer. DS reminded him that he is not authorized to do so and that “hire with no charge” equates to 100% discount.”

[34] Mr McGrath said at that time it was five, but he could only remember two. It was put to McGrath that the total value up to April 2020 of his total invoiced value was just under $63,000. Mr McGrath said it was approximately $370,000. He accepted he could not say that was invoiced hire, and when it was put to him that his invoiced hire up to April 2020 was only $63,000 he said unless he saw the figures wouldn’t be able to agree with it.

[35] Mr McGrath was taken to the investigation report attached to the statement of Mr Stephenson 8 where it is recorded that his combined hire invoice amount as at May 2019 was $62,750. Mr McGrath agreed that is what the report said but couldn’t accept this was accurate.

[36] It was put to Mr McGrath that further into the statement of Mr Stephenson at annexure DS-14, that there are a range of months where his sales performance was zero. Mr McGrath didn’t appear to accept that he had zero sales for a range of different months in 2018, 2019 and 2020. Mr McGrath said in the first few months after he commenced employment he could not get revenue because he did not have scaffold out under his name. He said in October and November of 2019 he was on paternity leave, and then the office closed for Christmas/New year and then in February 2020 coronavirus kicked in.

[37] Mr Heng said that he first became aware of the Applicant’s underperformance in early December 2019, when Mr David Pash, former General Manager and to whom Mr Dean Stephenson reported to, spoke to him about concerns regarding Mr McGrath’s sales performance.

[38] Mr Heng said that to the best of his knowledge and understanding, Mr McGrath continued to underperform, and a subsequent performance discussion was held on 3 February 2020 that resulted in the Applicant being issued with a written warning.

[39] Mr Heng said that in the written warning, Mr McGrath was informed he was to be placed on a PIP (“PIP-1”), to assist in improving his poor performance. He said that to the best of his knowledge, Mr McGrath did not object to the targets of this PIP.

[40] Mr Stephenson’s evidence is that Mr McGrath’s total hire sales performance since the commencement of his employment until approximately 28 November 2019, being the first 13 months of his employment, was $62,561.00, against three jobs he had won.

[41] Mr Stephenson noted that regarding one of these jobs, Mr McGrath confirmed to him that November 2019 was the last claim for this project and that all works had been agreed. He said however, in January 2020, he spoke with Mr McGrath and questioned him on the significant amount of material being returned from site, well after the end of November, and regarding the customer short paying the company. Mr Stephenson said Mr McGrath replied that he was negotiating an issue with the customer regarding the lift lobby scaffold. Mr Stephenson said this went on for ‘several weeks’ and eventually the Respondent was required to credit the client approximately $5.5k regarding the issue.

[42] Further to this evidence, Mr Stephenson stated that even taking into account the Applicant’s parental leave from October until late November 2019, and giving him a grace period regarding his commencement, the Applicant’s sales performance up to November 2019 was ‘underperforming’.

[43] Mr Stephenson confirmed he subsequently issued a written warning to Mr McGrath.

[44] On 17 February 2020, he met with Mr McGrath to present him with the PIP as foreshadowed at the 3 February 2020 meeting. He said at this meeting, they had a discussion to the following effect:

“DS: Shane, we need to address the lack of revenue you are bringing to the Company. Your current pipeline and win/loss ratio were not going to get you to where the Branch needed you to be. I’ve drafted this PIP to help you achieve the results we need.

I also need you to keep me updated on your daily movements as I want to be sure you are making the best use of your time. I think your time management needs improving as there had been several times where you had requested work from our estimators that needed completion in a short timeframe, but you’ve had the info on your desk for multiple days of even weeks prior to passing it on. That’s something you need to be more aware of.

I will make myself available to assist you with pricing and meetings provided you give me sufficient notice to plan for them.

Shane again, we want you to succeed because that’s how the Company will succeed. I’m not enjoying this process, but we must achieve our targets.

SM: Dean, I’ve been on paternity leave and it is unfair for me to be placed on a PIP. Initially my area included part of the Sunshine Coast but that has been taken away from me given we now have a distributor servicing that area. My budget should have been adjusted for that.

DS: Well, in all the time prior to setting up the distributor including the time the Waco Maroochydore Depot lost its Manager in Jan 2019 you have not made a single sale for that area. I don’t think your poor performance is related to the setting up of the distributor.”

[45] Mr Stephenson acknowledged that the PIP documentation was dated to start on 28 November 2019, being the date Mr McGrath was first informed of his underperformance, and he accepted that Mr McGrath may have taken this date to be prejudicial to him. Mr Stephenson stated however this was not his intention, and was merely to note the date from which Mr McGrath was notified of his performance failures.

Alleged Shut Down of the Industry

[46] Mr McGrath reiterated his submission that in light of the COVID-19 pandemic, the building industry experienced a shutdown ‘overnight’, and staff were subjected to an illegal “20% wage reduction for 3 months”, which they were forced to sign under duress of being made redundant.

[47] Mr McGrath said that on 30 March 2020, a sales meeting was held following an email from the Respondent’s Managing Director, Mr Bruce Nicholson, which stated that “all employees are to take a 20% pay reduction from 1st April to 30th June”. Mr McGrath said Mr Nicholson addressed the entire Brisbane office staff and stated: “If you do not sign the letter then you will be made redundant”. Mr McGrath said this was coercion of the employees, through threats to sign documents affecting staff wages and entitlements.

[48] Mr McGrath said that on 31 March 2020, all Brisbane employees were individually required to enter a room and sign the letter. Mr McGrath said he signed in order to prevent being made redundant or otherwise terminated.

[49] Mr McGrath submitted he was also subjected to unfair treatment after asking, by a formal letter to HR and Management, for the PIP to be waived. He said following this request he was issued a notice of ‘Misconduct and Fraudulent Information’ which lead to an official warning issued by the Respondent.

[50] Mr McGrath was asked if he was aware the Brisbane Branch was not doing well financially, and Mr McGrath said Mr Stephenson said they needed to increase figure. It was put to Mr McGrath that a salesperson who only brings in $65,000 in 18 months is of concern for a business not doing well financially. Mr McGrath did not accept that.

[51] Mr McGrath agreed that he had said in February and March 2020 the building industry shut down overnight. Mr McGrath was taken to a table in his reply submission setting out jobs won. He was asked whether he accepted the Respondent’s sales in March 2020 was $1.2mil despite the shutdown overnight. Mr McGrath claimed that was a result of an earlier contract. He also said the $394,000 in April which was much more that April in 2019, and after COVID-19. Mr McGrath claimed this was a result of work won months earlier.

[52] It was put to Mr McGrath in May $85,000 in sales were achieved, and sales in June and July 2020 were higher than in 2019 despite the claim that COVID-19 shutting had down the industry. Mr McGrath claimed these were regular customers and he was asked what customers were buying if the industry was shut down and he said some businesses still doing some work during COVID-19.

[53] Mr McGrath was referred to an excel spreadsheet attached to the statement of Mr Stephenson at DS-14, where despite Mr McGrath saying COVID-19 shutting down industry, there was still higher revenue in April through to August 2020 than 2019. He accepted that. It was also put that other months were comparable as between 2020 and 2019. Mr McGrath claimed this was scaffolding already up and Mr McGrath still maintained COVID-19 shut down the industry.

[54] Mr Stephenson accepted during his oral evidence that an email was sent to all staff requesting they accept reduction in pay by 20%.

[55] Mr Humphrey was asked whether it would have been reasonable to reduce the sales targets because of COVID-19 and he responded that the construction industry was not significantly affected by COVID-19 in Queensland.

[56] On the basis of the evidence COVID-19 does not appear to have had a significant impact on the Respondents ability to win work in the construction industry in Queensland and on that basis Mr McGrath’s argument that his targets were unfair because of COVID-19 are not borne out by the evidence.

Alleged oral warning in November 2019 and written warning in February 2020

[57] The Respondent submitted that Mr McGrath attended a meeting with Mr David Pash, the then General Manager of the Company, and Ms Carolyn Litfin, Regional Contracts Manager, on 28 November 2019. During this meeting, Mr Pash raised concerns with the Applicant about his failure to meet performance requirements, and Mr McGrath was given a verbal warning during this meeting in relation to his performance failures.

[58] The Respondent submitted on 3 February 2020, a further meeting was conducted with Mr McGrath by Mr Pash and Mr Dean Stephenson and Mr McGrath was advised that his performance continued to be inadequate and that he would be issued with a written warning and placed on a PIP.

[59] Mr McGrath said he did not recollect the meeting of 3 February 2020 with Mr Pash and Mr Heng, but he accepted that it happened. Mr McGrath was referred to the statement of Mr Heng where he referred to notes written by Mr Pash summarising his recollection of the meeting on 3 February and 28 November 2019. Mr McGrath said the notes were false.

[60] Mr McGrath accepted that the notes said what they said but he said the meeting on 28 November didn’t happen and it was just a passing comment from Mr Pash. It was put to Mr McGrath that he said he didn’t recall the meeting of 3 February meeting and he accepted that.

[61] It was put to Mr McGrath that his evidence was not reliable as to what was said or not said at the meeting on 3 February because he didn’t remember the meeting. Mr McGrath maintained the alleged conversation on 28 November did not happen. Mr Pash’s notes of what he said happened at the meeting on 28 November were attached to the statement of Mr Heng and appeared quite detailed. I am more inclined to believe that contrary to the evidence of Mr McGrath a meeting did occur on 28 November 2019.

[62] Mr McGrath was asked whether the note was an accurate recollection of what happened at the meeting and he did not. On the face of the document, it would appear Mr Pash had written down Mr McGrath’s responses as he recalled. Mr McGrath suggested it could not be accurate because Mr Pash had left the business but then accepted it would have been after the meeting on 3 February 2020.

[63] Mr Heng said that during his discussion with Mr Pash in December 2019, Mr Pash advised he had met with the Applicant on 28 November 2019 to discuss his performance issues. Mr Heng said that Mr Pash sought HR advice from him, on how to improve the Applicant’s performance. Mr Heng said he advised that the Company should place the Applicant on a PIP to provide a proper process to help him improve his performance.

[64] It was put to Mr Heng no verbal warning was given during this meeting. Mr Heng said Mr Pash informed him in November that there was a verbal warning given to Mr McGrath and he was told that again in February, and the verbal warning was referred to in the written warning document and not challenged at the time. Mr McGrath asked Mr Heng if it was considered to decrease his sales targets because of COVID-19. Mr Heng said he did not know. Mr Heng agreed that employees were asked to agree to a pay reduction of 20% for a period of months due to the pandemic.

[65] Mr Stephenson stated he was aware that Mr McGrath had a meeting with Ms Litfin, and Mr Pash, on 28 November 2019. He said the Applicant’s sales performance was discussed at that meeting.

[66] Mr Stephenson was away on annual leave at that time, but on his return he said he had a discussion with Mr Pash and Ms Litfin to the following effect:

DP: I’ve had a conversation with Shane regarding his unacceptable revenue performance and that Shane had been told that this was a verbal warning and that given his very ‘soft budget’ he had no reason for not attaining what was necessary. We felt it was necessary to have this discussion with Shane even though you were on leave. His pipeline and win/loss ratio are not providing a sufficient basis for the Company to continue with his employment.

CL: David made it very clear to Shane that he had not performed anywhere near expectations and that an immediate improvement was required.

DS: Ok. I think we should put Shane on a PIP.

DP: Yes, I agree. That would help him to reach his targets and become a valuable contributor to the Branch.

[67] Mr Stephenson said that he attended a meeting of 3 February 2020 with Mr McGrath to discuss his performance. Mr Pash was also at this meeting. Mr Stephenson said they had a discussion to the following effect:

DS: I wanted to discuss with you your lack of performance from a revenue and procedural point of view. This is not something that has just occurred, but this has been an ongoing issue since you started. David spoke to you last year about your performance and I’m speaking to you again today because you’re still underperforming

I’m going to issue a written warning to you in relation to your performance and put you on a performance improvement plan, and you will be given ample opportunity to respond and be assisted to be successful. The Company wants you to be successful as this would mean success for the Company as well.

DP: I agree with Dean here. Dean has and will continue to assist you whenever you request but to date your revenue is well below acceptable and your pipeline and win/loss ratio is poor at best.

SM: I believe my lack of performance is due to Head Office not setting up works for me to manage their accounts and because I’ve also recently been on paternity leave which combined with the Christmas period had worked against me from a pipeline point of view.

DP: Shane, we don’t agree. These issues are long term performance issues, not only something that’s happened in the past three months.

[68] Mr Stephenson was asked about the claim Mr McGrath had received a verbal warning in November 2019 and he said when he returned from America and Mr Pash told him about it and provided him with notes from Meeting. Mr Stephenson was asked whether he had anything to say about Ms Litfin saying no formal warning was given at this meeting and Mr Stephenson said he wasn’t there.

[69] I am satisfied on the basis of the evidence that contrary to what Mr McGrath has claimed he was given an oral warning in November 2019 before he received the subsequent written warning in February 2020.

Final warning on 6 May and subsequent allegation of Allegation of unfair treatment

[70] Mr McGrath submitted that he was placed on a PIP by the Respondent which set unrealistic, unfair and unjust targets, with minimal assistance from his manager in improving his performance. Mr McGrath submitted that he was placed on a PIP for a total of 150 days, where the Fair Work Ombudsman only recommends period of 30, 60 or 90 days.

[71] Mr McGrath also said he was also treated unfairly and adversely after filing a Formal Grievance against Mr Stephenson. He stated that the Respondent’s HR Manager, Andrew Heng, and Commercial Director, Simon Humphrey, cancelled the original PIP “due to inaccurate recordings, unfair findings and non-quantifiable targets set”.

[72] He said the Official Warnings given to him during this time were not rescinded and enabled a termination at any time; he said this is despite “later proven reasons for Warnings were unsound”.

[73] Mr McGrath was asked about an allegation put to him by Mr Stephenson that he had made false statements about having won work with a company called Intrepid. Mr McGrath said that was not true. Mr McGrath accepted that he did say to Mr Stephenson on 23 April that he had won the works with Intrepid and they were to commence in 4-5 Weeks, however he said he was told by the scaffold subcontractor that it should be starting then. Mr McGrath accepted that Mr Stephenson had spoken to ‘Shane’ from Intrepid and was told they hadn’t won the work yet however he just relayed what he was told. Ultimately the Respondent did not win the work.

[74] It was put to Mr McGrath that he said he said to Mr Stephenson on 23 April he had won the Intrepid work because he had only won one job in his PIP period, and in order to boost appearance of his sales. Mr McGrath rejected that.

[75] It was put to Mr McGrath that he did not follow company procedure by using his managers signature without his permission and sent them to clients. Mr McGrath said there was a quote form with Mr Stephenson’s signature on it and he was not the only one doing this.

[76] It was put to Mr McGrath that legitimate aspects of the final warning that he didn’t improve performance as required under PIP and he had made false statements and hadn’t followed procedures and used Mr Stephenson’s signature without permission, and was not in retaliation to correspondence from Mr McGrath. Mr McGrath rejected that. He accepted his was aware his employment was in jeopardy after having received the warning letter.

[77] The Respondent submitted that Mr McGrath met with Mr Stephenson on 23 April 2020, to discuss his progress under the PIP and Mr McGrath was advised that his performance was still unsatisfactory, and there were also discussions about potential instances of serious misconduct that had been brought to Mr Stephenson’s attention.

[78] The Respondent said that meeting was followed up by a further meeting on 30 April 2020, providing Mr McGrath an opportunity to provide his responses to the instances of serious misconduct as previously raised with him. Further to this meeting, Mr McGrath was issued a final warning on 6 May 2020. This final warning was issued for reason of his underperformance in respect of his sales targets and for reason of his serious misconduct.

[79] On 26 May 2020, Mr McGrath lodged a formal grievance with the Company in relation to the PIP and the warnings that he had received. The Respondent submitted that the grievance was thoroughly investigated, and a report was produced and provided to Mr McGrath on or around 12 June 2020. As a part of the recommendations in that report, the PIP for Mr McGrath was extended for a further two months from 1 July 2020 to 31 August 2020 (the July PIP). The Respondent determined not to rescind the two written warnings that had been issued to Mr McGrath.

[80] Mr Heng said that on or around 23 April 2020, Mr Stephenson met with the Mr McGrath to conduct the PIP-1 review.

[81] Mr Heng said on 24 April 2020, Mr Stephenson told Mr Heng that Mr McGrath had sent a request for the PIP-1 to be waived due to the COVID-19 pandemic and suspended until 1 November 2020. Mr Heng said that he advised Mr Stephenson that the review period for PIP-1 had taken place well before any impact from COVID-19 and that in any event this was not an acceptable excuse for the serious misconduct issues. He said he advised Mr Stephenson to proceed with inviting Mr Stephenson to attend a disciplinary meeting to discuss the serious misconduct issues in addition to the poor progress against the PIP- 1. Mr Heng was asked if the first PIP was cancelled and he said no that the second PIP was a continuation of the first PIP.

[82] He said to the best of his knowledge, Mr Stephenson did conduct a disciplinary meeting on or around 30 April 2020 and Mr McGrath was subsequently issued a final written warning on 6 May 2020 for serious misconduct and poor performance. Mr Stephenson said Mr McGrath was given approximately two months to meet the targets of the PIP and a review meeting was conducted on 23 April 2020.

[83] On 27 May 2020, Mr Heng received a formal grievance from Mr McGrath and on receipt he commenced an investigation into the issues raised by Mr McGrath. Mr Heng said during the investigation, he spoke to Mr McGrath to clarify the facts and understand what outcome he was seeking. Mr Heng also spoke with Mr Stephenson about his view on the comments and allegations Mr McGrath had made in his formal grievance.

[84] Mr Heng said he was unable to speak with Mr Pashas he had left the Company, however he did speak with Mr Simon Humphrey, Commercial Director, who was Mr Stephenson’s manager, to apprise him of the formal grievance and Mr Heng’s intended actions to investigate the matter.

[85] Mr Heng said that the main areas of concern raised by Mr McGrath were:

(a) The continuation of the PIP-1 was unreasonable due to the COVID-19 pandemic;

(b) There were inconsistencies in the dates referred to in warning letters, the PIP and Shane’s chronology of events;

(c) The set targets in the PIP-1 were unfair as they had not been adjusted to allow for the reduction in opportunities due to the COVID-19 pandemic;

(d) The redistribution of accounts following the resignation of one Sales Representative was unfair;

(e) The issue of the first written warning was unfair;

(f) The issue of the final written warning was unfair;

(g) The performance monitoring only commenced upon Shane’s return from parental leave;

(h) Seeking to have the warning letters formally rescinded due to the above grievances; and

(i) Seeking to have the PIP-1 suspended until 1 November 2020.

[86] Mr Heng said that at the conclusion of his investigation, he drafted a report which was provided to Mr McGrath on 12 June 2020. The main findings of the investigation were:

(a) The decision by the Company to initiate PIP-1 was fair. Shane’s performance to date was unsatisfactory even prior to the impact of COVID-19 on the business, which I understood to be minimal in relation to the Brisbane branch.

(b) Shane’s sales performance was well below the target of $188,000 per annum, a target which of itself is also well below the $600,000 minimum set for sales roles.

(c) Monitoring of Shane’s performance had commenced before he had been on parental leave and was not related to his taking of parental leave in any way.

(d) The Company acknowledged that some of the dates in the documentation were incorrect (such as the date of the commencement of the PIP-1) but these were explained to Shane and corrected.

(e) The issue of the first warning was fair as it was related to Shane’s underperformance and signalled the commencement of the PIP-1 and therefore would not be rescinded.

(f) The issue of the final warning was fair as Shane did not perform to the required level under the PIP-1 and further, the warning also related to legitimate serious misconduct matters and therefore would not be rescinded.

(g) Regarding Shane’s request to have the PIP-1 suspended until 1 November 2020 and the re-setting of the targets giving consideration to COVID-19, the Company did not agree with this request. However, the Company decided to recommence the PIP process for a period of a further two months.

[87] Mr Humphrey said on 26 April he was informed by a letter from Mr Heng that he would undertake a formal investigation into concerns raised by Mr McGrath, and Mr Heng subsequently concluded the grievances asserted by Mr McGrath were unfounded. Mr Humphrey said he was present when these views were shared with Mr McGrath, and as part of the investigation the Respondent offered to re-commence the PIP for a further two months commencing in July. Mr McGrath put to Mr Humphrey that his grievance was that he wanted the PIP postponed to the end of the year because of COVID-19. Mr Humphrey accepted that.

[88] On the basis of the evidence I am not satisfied that the allegations made by Mr McGrath in his grievance 27 May that he had been the subject of unfair treatment by the Respondent were made out.

Performance against the Targets and whether targets were reasonable

[89] Regarding his performance against the improvement plans, Mr McGrath’s evidence is that his performance was improved considerably since the initial PIP in 17 February 2020. He noted however there were a number of factors which impeded his sales results and caused major delays in contract signings from builders using the products. As addressed above Mr McGrath stated that the Covid-19 pandemic caused the building industry to slow down and stop since 1 March 2020, as demonstrated in the Queensland sales figures, however as concluded earlier this claim is not supported by the evidence

[90] While Mr McGrath believed he had improved his performance, in closing some projects worth $300,000, Mr McGrath said nevertheless, Mr Stephenson “consistently showed Adverse Action in any feedback in the 1st PIP”. Mr McGrath noted this first PIP was later cancelled by the HR team and Mr Simon Humphrey, National Commercial Manager.

[91] Mr McGrath accepted he attended a meeting with Mr Stephenson on 23/4/2020 where his performance against the PIP was reviewed. Documents relevant to this meeting were attached to the statement of Mr Stephenson (DS-3, DS-4). Mr McGrath accepted that one of the performance criteria was improve immediate sales to achieve budgets month on month. It was put to Mr McGrath that he only had one project at that time, and he responded others were in the works.

[92] It was put to Mr McGrath as at 23 April 2020, he had achieved zero in terms invoiced hire revenue and he accepted that, however said he had won jobs.

[93] Mr McGrath was referred to his Final written warning dated 6 May 2020 attached to the statement of Mr Stephenson (DS-9) Mr McGrath was asked whether he accepted at the time of receiving this warning he had not met the level required and he answered no.

[94] It was put to Mr McGrath that the Respondent decided to recommence his PIP after he lodged a grievance about the first PIP process. Mr McGrath said the first PIP was cancelled.

[95] He accepted that if his performance did not improve as per the PIP his employment would be in jeopardy, and he confirmed he agreed to the terms of the PIP by signing it, however he also said he felt he was set up to fail. His evidence was he believed most of them he could achieve however there was no way he could get the invoiced sales because it takes months for them to be entered into the system.

[96] Mr McGrath said Mr Simon Humphrey set the targets in the PIP. The July to August PIP targets were attached to the statement of Mr Humphrey. It was put to Mr McGrath that the PIP target in section 3 first review milestones for July was a minimum of seven quotes, 10 tenders leads per month and monthly invoice sales targets was $35,000 and in August a minimum 10 quotes, minimum of 15 tenders and invoice sales targets of $45,000. He accepted that.

[97] Mr McGrath said he maintained these targets were unreasonable. It was put to him that he had himself set higher targets for the year of 2021. Mr McGrath was taken to an attachment to the statement of Mr Stephenson where Mr McGrath sent an email on 10 March to Mr Stephenson setting out his budget for the new financial year setting out his own targets and how he believed he would achieve those targets. Mr McGrath rejected that it was a budget but was what he thought he could get in the year to give to management. He agreed this document provided his thought process as at 10 March 2020 as to how he would achieve budget figures of $44,500 in July and $48,000 in August but he said this was before COVID-19 lockdowns really happened.

[98] It was put to Mr McGrath that this was a useful document to estimate what sales could be achieved. He rejected that. It was put to Mr McGrath that the numbers required of him at $35,000 for July and $45,000 in August were lower than Mr McGrath himself had proposed. Mr McGrath agreed with that but he said this was prior to COVID-19.

[99] Mr McGrath claimed the numbers were unrealistic because of the time it takes for invoices to go through. It was put to Mr McGrath 1-2 months from July/August would be April/May/June and he was asked what he was doing during these months. Mr McGrath provided a response however it did not provide a satisfactory explanation for why he was unable to achieve targets in the PIP.

[100] Mr McGrath said he did have a $1,000,000 deal and another $200,000 deal pending however this was not achievable by July or August. Mr McGrath said it takes months to get these agreements done.

[101] Mr McGrath accepted that he did not achieve item 9 for both July and August in his PIP. Mr McGrath was asked whether he still maintained that he achieved 7 of the 9 items in both July and August as he had put in his written submissions and he said he did.

[102] Mr McGrath was taken to the statement of Mr Humphrey and his recording of McGrath’s performance against the July PIP which recorded a cross against items 3,4 and 9. Mr McGrath claimed he did achieve these items. In relation to August it was put to Mr McGrath he did not achieve item 1. It was put to Mr McGrath he did not achieve the 25 calls per weeks as Mr Humphrey said in his evidence at paragraph 20 of his statement. Mr McGrath said he had no evidence either way.

[103] In relation to item 2, it was Mr Humphrey’s evidence that he was close to achieving the target but not quite. In relation to item 3 it was put to McGrath he was required to obtain 10 quotes and he achieved 7. Mr McGrath claimed he obtained 21.

[104] Item 4 was a requirement to obtain 15 tenders and it was put to Mr McGrath he obtained zero tenders. Mr McGrath appeared to say he was not sure. Mr McGrath accepted he did not achieve item 9 the invoice amount but maintained it was not achievable.

[105] It was put to Mr McGrath that quotes issued for the purposes of the PIP are quotes to clients not to the estimator and it is not correct to count them for the purposes of the PIP. Mr McGrath said he had them ready but they were waiting on the estimator. It was put to Mr McGrath that giving quotes to the estimator on the last days of July meant it could not actually be returned to him in time to issue in July. Mr McGrath said it was not up to him it was up to the estimator. On Mr McGrath’s own evidence, he accepted that the estimator has a fair amount of work to do.

[106] Mr McGrath was taken to a table in his material where he provided plans given to the estimator on the last two days of July would mean it is impossible for the estimator to get the quotes back to Mr McGrath in order to get authority from Mr Stephenson to then issue the quotes to be counted as issued in the PIP.

[107] Mr McGrath was taken to quotes for Watpac Jubilee Place quotes and it was suggested that he was counting quotes for the same job as more than one quote. Mr McGrath said repricing involves a lot of work and therefore should be counted as a separate quote. Mr McGrath was also asked about a number of jobs given to the estimator for August which were also quotes given to the estimator in July. Mr McGrath accepted that and said they given back to him and he had to redo some things and then resubmit them. It was put to Mr McGrath that these quotes are being double counted in order to attempt to show he reached the targets. Mr McGrath said the PIP did not say they could not be counted again.

[108] Mr McGrath was asked about the two pending jobs in the pipeline worth $1 million dollars and another worth $200,000. Mr McGrath said it was only the final signatures that were being waited on due to be issued in hours or days of the final meeting that led to his termination. It was put to Mr McGrath that until the contract has been signed it was not done. It was put to Mr McGrath the contracts had not been signed by the end of the PIP period. Mr McGrath said that he had been advised orally the contracts had been won. It was put to Mr McGrath that even if the two contracts were signed he would still not have reached the target in the PIP. He accepted that, and he accepted Mr Stephenson said that to him the meeting.

[109] Mr McGrath was taken to the statement of Mr Stephenson at paragraphs 43 and 44 where he gives evidence that hire value of the Watpac project was $120,000 over 40 weeks and the other project was $45,000 over 26 weeks and therefore the invoice value of both projects was approximately $20,000 per month. Mr McGrath accepted that he would not have achieved the PIP on those projects. It is apparent from the evidence Mr McGrath did not meet the sales targets in the PIP and would not have even if the pending work had been signed.

[110] Mr McGrath said that unfair and unjust Sales Revenue targets were set at the start of the second PIP he was placed on, being $45,000 a month.

[111] Mr McGrath stated that the target set for him was unfair, as no other Queensland sales representative had a similar target or was able to achieve “even 70% of the number”, and stated “Shane’s after Covid-19 sales $300k which was No.1 with QLD Sales team excluding Dean the State Manager with $900,000”.

[112] Mr McGrath attached ‘excel spreadsheets 8 & 11, and with reference to them stated that it can be seen that a target of ‘10 quotes’ to be issued per month was achieved, which exceeded the nominated amount in the PIP per month.

[113] Mr McGrath’s evidence is that in accordance with correct procedure, he required the assistance of the ‘Draftsman’, however he was away for a period of three weeks on sick/personal leave, which Mc McGrath says in turn meant he was unable to finalise the abovementioned quotes in time for the completion date of his second PIP. He said that Mr Stephenson was updated continuously regarding the awaiting projects, which he said “caused delays to allow Shane to complete / verify pricing / onforward the quotes to the clients”.

[114] Mr McGrath said that it was ‘inequitable’ for the Respondent to state in the termination letter: “blaming others for your poor time management is not acceptable” when correct procedure was adhered to, and Mr Stephenson had been regularly updated and notified of the delays preventing quotations being completed.

[115] Mr Heng said Mr McGrath was provided a revised PIP (“PIP-2”), which he said he understood Mr McGrath agreed was fair and reasonable.

[116] Mr Heng said that Mr Humphrey contacted him and told him of Mr McGrath’s continued underperformance. He said he advised Mr Humphrey to provide Mr McGrath with procedural fairness in relation to this issue. He said to the best of his knowledge, Mr McGrath was asked to attend a meeting regarding his failure to achieve the targets of the PIP-2. Mr Heng said that Mr Humphrey and Mr Stephenson conducted the meeting, and during an adjournment they contacted Mr Heng to obtain further advice regarding Mr McGrath’s unsatisfactory explanation. He said Mr Humphrey and Mr Stephenson were inclined to terminate the Applicant’s employment for underperformance, and Mr Heng advised them to communicate their preliminary decision to Mr McGrath and to provide Mr McGrath an opportunity to show cause as to why his employment should not be terminated.

[117] Mr Heng said he understood that Mr Humphrey and Mr Stephenson reconvened the meeting to advise of these matters, further to which Mr McGrath provided his show cause response. He said Mr Humphrey and Mr Stephenson further adjourned the meeting to seek further advice from him. Mr Heng said they had discussions, further to which it was concluded that Mr McGrath’s continued underperformance and extended opportunity to improve, which spanned over eight months since he was first formally spoken to about his underperformance, justified the Company’s decision to terminate his employment, when also taking into consideration the final warning he had received earlier for serious misconduct.

[118] Mr Heng said the PIP process finished in September. Mr McGrath put to Mr Heng that the first PIP finished because of a grievance letter he submitted. Mr McGrath asked whether it was fair for the PIP to go for as long as it did. Mr Heng said the company wanted to give Mr McGrath every opportunity to achieve the PIP targets, further Mr McGrath had raised issues, and a new General Manager had commenced and there was no hard and fast rule for how long a PIP last for.

[119] Mr Heng was asked if it was fair for his sales targets to be increased while employees were asked to accept reduced salary. Mr Heng said it was not for him to set the sales targets.

[120] Mr McGrath asked Mr Stephenson about the issue of a Watpac representative all but saying the contact was won. Mr Stephenson did not accept that, and said that the advice was the Respondent had been put forward and it was with their commercial people.

[121] Mr McGrath asked Mr Stephenson if it was ever mentioned if there going to be a decrease in sales targets set due to COVID-19, and Mr Stephenson said no. Mr Stephenson said during COVID-19sales targets were made with employees, and luckily in Queensland there was not one day where work was shut down as it was considered an essential service.

[122] Mr Stephenson said the initial proposed budget for Mr McGrath of $200,000 was not even going to cover his costs to the company and Mr McGrath came back to him with his own budget numbers which were adopted.

[123] Mr McGrath asked Mr Stephenson when the original PIP started, and Mr Stephenson said February after what Mr Pash told him. Mr Stephenson said Mr McGrath’s figures were bad throughout his PIP and he was given nine months and did not improve.

[124] Mr Stephenson said that Mr McGrath’s value to the company was unsustainable from a performance point of view.

[125] Mr Humphrey said he reviewed and approved the PIP prepared by Mr Stephenson and attended all meetings with Mr McGrath concerning the PIP. Mr Humphrey said he disagreed with Mr McGrath’s comments that the targets in the PIP were unattainable, and Mr McGrath had agreed to those targets earlier in the year and had exaggerated the effect of COVID-19. Mr Humphrey said Mr McGrath had been underperforming since he commenced employment well before COVID-19 was a factor.

Initial PIP meeting 2 July 2020

[126] Mr Humphrey said the requirements of the PIP were explained to Mr McGrath at meeting on a 2 July. Mr Humphrey said in the meeting Mr McGrath raised that he did not know his targets for the year however Mr Stephenson explained to him that they had worked through the targets earlier in the year and had emails between them exchanged on the subject. Mr Humphrey noted that the Respondent had allowed a ramp up in performance by including lower targets in July of $35,000 than $45,000 in August.

First Review 7 August

[127] Mr Humphrey said at the first review meeting Mr McGrath’s actual performance as recorded on a spreadsheet was discussed against the PIP targets and each improvement area was talked through. Mr Humphrey said a minimum 7 quotes per month was not met, and a minimum of 10 tenders were not met, and the revenue target of $35,000 was not met and instead $14,000 was achieved.

Second Review meeting of 7 September and Further meeting of 11 September 2020

[128] Regarding his final PIP meeting on 7 September 2020, Mr McGrath stated that Mr Humphry and Mr Stevensonhad both agreed Mr McGrath had reached “achievable levels of the targets set or beyond”, with the exception of the Sales Revenue Hire which Mr McGrath said was able to be reached moving forward based on two sales of $1.0 million and $200,000 “( Current business achieved since commencement of first Pip was multiple sales worth $300,000 combined revenue ).” Mr McGrath said that this was confirmed during the meeting of 11 September 2020, where Mr Stephenson stated, “All but the sales revenue target was reached, which is the main issue”.

[129] Mr McGrath stated that the Respondent acted unfairly and unjustly in referring to inaccurate and misleading information in the termination letter, when matters had been “verbally agreed to in the meeting days prior”.

[130] Mr McGrath said that the Respondent subjected him to unfair and unjust treatment, through ‘inaccurate recording’ of a PIP which lead to his termination. He said that:

“7 ½ Months (170 days) of PIPs during a Worldwide Pandemic Covid-19, that was acknowledged by WACO MD Bruce Nicholson as having an effect on the business, thus reducing [his] wage by 20% for 3 months”.

[131] The Respondent submitted that Mr McGrath participated in the July PIP, and on 7 September 2020, Mr McGrath met with Mr Stephenson and Mr Simon Humphrey review his performance against the July PIP.

[132] The Respondent said that during this meeting, Mr McGrath was advised that he had only met some of the requirements of the July PIP and had failed to meet the sales targets required. The Respondent said that Mr McGrath replied during this meeting, to the effect that he had significant work in his pipeline that was merely awaiting a final signature. The Respondent said that it disagreed with Mr McGrath’s view, because the work in the pipeline was not guaranteed. The Respondent also did not agree with Mr McGrath’s view that it should take into account what he had in his pipeline, and instead assessed the July PIP against actual revenue that he had generated in the two months.

[133] The Respondent said that its position in this regard has “ultimately been proven correct” as a significant portion of the work Mr McGrath had in his pipeline was not awarded to the Company.

[134] The Respondent submitted that due to Mr McGrath’s failure to meet the targets of the July PIP, the Respondent said that on 10 September 2020, he was provided with a written notice inviting him to a meeting on 11 September 2020. The Respondent said that Mr McGrath was notified that he was able to bring a support person to that meeting and that one of the potential outcomes arising from that meeting was the termination of his employment. The meeting invitation also drew Mr McGrath’s attention to the final written warning that he had received on 6 May 2020.

[135] The Respondent said that during that meeting, Mr McGrath was given a further opportunity to explain his performance failures as well as reasons why his employment should not be terminated. The Respondent noted that having considered Mr McGrath’s underperformance together with the responses given by him during the meeting, the Company made a decision to terminate Mr McGrath’s employment that day for reason of his underperformance.

[136] Mr Humphrey said at the second review meeting the actual performance was reviewed and overall the level of activity was lower in August than July. Mr Humphrey said Mr McGrath stated he could not achieve quotes targets because the estimator was unavailable and Mr Stephenson responded it was fundamental to the sales role to manage the sales process and ensure requirements of the client are met.

[137] Mr Humphrey said that it was noted by Mr Stephenson that Mr McGrath had not supported customers promptly on multiple occasions to ensure they receive the required equipment and when he went on leave left it to others to pick up the pieces. Mr Humphrey said from what he had seen Mr McGrath’s attention to detail was not sufficient.

[138] Mr Humphrey said Mr McGrath said he had two large projects that were looking promising and would deliver significant revenue, however both Mr Stephenson and himself noted that there was still a long way to go to secure those projects and hence the revenue could not be banked. Mr Humphrey said as it turned out neither project was won.

[139] Mr Humphrey said following the meeting Mr Stephenson and himself determined that Mr McGrath had failed to meet the requirements of the PIP and that a further opportunity should be given to him to respond before the Respondent made a decision about his ongoing employment.

[140] Mr Humphrey said on 11 September he attended a meeting with Mr McGrath and Mr Stephenson and Mr McGrath’s father-in-law as a support person.

[141] Mr Humphrey said he summarised the background and said there had been two years of underperformance, that Mr McGrath had been placed in a PIP since February and due to his concerns this was extended to July/August and unfortunately the Respondent did not believe Mr McGrath had reached the required level of performance and was considering termination.

[142] Mr Humphrey said Mr McGrath was given an opportunity to respond. Mr Humphrey said Mr McGrath said he believed he had paid for himself and Mr Humphrey said he responded that Mr McGrath had not covered his costs of employment since being employed by the Respondent. After further discussion a break was taken and when the meeting recommenced Mr McGrath said he wanted to remain with the Respondent. Mr Humphrey said a further short break was taken and after discussion between Mr Humphrey and Mr Stephenson it was decided that Mr McGrath’s employment should be terminated due to his underperformance and this was communicated to Mr McGrath when the meeting resumed. Mr Humphrey said Mr McGrath was told he would be paid out his notice and accrued entitlements.

HARSH, UNJUST OR UNREASONABLE

Valid reason

[143] The Respondent submitted that the reasons for the termination of the Applicant’s employment were “sound, defensible or well founded”. It submitted there is no basis upon which the Commission could reasonably conclude the Respondent’s reasons for terminating the Applicant’s employment were in any way “capricious, fanciful, spiteful or prejudiced” or anything other than valid.

[144] The Respondent submitted that since November 2019, Mr McGrath had been spoken to and warned, both verbally and in writing, about his poor performance and Mr McGrath had been placed on a PIP since February 2020.

[145] The Respondent submitted that Mr McGrath failed to achieve the sales targets required in both the original PIP and the extended July PIP.

[146] I am not satisfied on the evidence that Mr McGrath has been treated in an ‘unfair and unjust’ way by the Respondent in the manner it has managed issues in regard to the performance of Mr McGrath.

[147] Achievement of some elements of the PIP and failure to achieve others does not mean the requirements of the PIP are satisfied. I accept the Respondent’s submission that the sales target was the key criteria of the July PIP and it is clear Mr McGrath did not meet this.

[148] I also accept the position of the Respondent that it was entitled not to include potential future work in the pipeline as it is clear the target pertained to “monthly invoiced sales values”, and as was demonstrated in the evidence the Respondent only won a small portion of the work that Mr McGrath had in his pipeline.

[149] I also reject Mr McGrath’s claim that his sales had not met targets due to the effect of the COVID-19 pandemic, and that because of the pandemic the target in the July PIP was unachievable. The evidence shows the pandemic had little effect on the sales of the Brisbane branch.

[150] It is also clear from the evidence Mr McGrath did not meet “tender targets” and I agree with the Respondent that Mr McGrath bore responsibility for ensuring estimators had sufficient time to before the tender deadlines. It is clear Mr McGrath was underperforming and had failed to achieve requisite sales targets, notwithstanding being placed on a PIP. On that basis I am satisfied that the Respondent had a valid reason for dismissal.

Whether advised of the reason

[151] From the evidence it is clear Mr McGrath was notified of the reason for the dismissal.

Opportunity to response to any reason relating to capacity or conduct

[152] Mr McGrath was given an opportunity to respond to the reason at the meeting on 11 September 2020.

Any refusal to allow a support person

[153] It is clear there was no unreasonable refusal by the Respondent to allow Mr McGrath to have a support person, and Mr McGrath had his father-in-law as a support person at the meeting on 11 September 2020.

Whether the person was warned of unsatisfactory performance before the dismissal

[154] I am satisfied from the evidence that Mr McGrath was given three warnings about his performance including a verbal warning on 28 November 2019; a first written warning issued on 15 February 2020; and a final written warning on 6 May 2020.

Size of the employer’s enterprise and whether the company has dedicated human resources personnel

[155] The Respondent is a large enterprise and employs dedicated human resources personnel who were involved in the disciplinary process.

Any other matters

[156] Mr McGrath has raised the fact of his having responsibilities as a father and difficulty in gaining other employment given the COVID-19 pandemic in support of a claim that the termination was harsh. I have taken this into account.

CONCLUSION

[157] I have made findings in relation to each of the considerations under section 387 of the Act and having weighed those findings including that the Respondent had a valid reason for dismissal and afforded Mr McGrath procedural fairness in reaching its conclusion, I am satisfied the dismissal of Mr McGrath was not harsh, unjust or unreasonable. Accordingly, the application is dismissed.

COMMISSIONER

Appearances:

Mr S. McGrath appearing on his own behalf
Mr J. Li of National Workplace Lawyers appearing for the Respondent

Hearing details:

2021,
Brisbane:
February 4

Printed by authority of the Commonwealth Government Printer

1 Exhibit 1.

2 Exhibit 2.

3 Exhibit 8.

4 Exhibit 9.

5 Exhibit 10.

6 Exhibit 9 at para 39.

7 Exhibit 9 at attachment “DS-7”.

8 Exhibit 9 at attachment “DS-11”.

Shane McGrath v Waco Kwikform Limited