Shaun Crowley v Modcon Group Pty Ltd
[2024] FWC 1423
•14 JUNE 2024
| [2024] FWC 1423 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Shaun Crowley
v
Modcon Group Pty Ltd
(U2023/9447)
| DEPUTY PRESIDENT LAKE | BRISBANE, 14 JUNE 2024 |
Application for an unfair dismissal remedy –workplace conduct – financial impact on business–– serious misconduct –summary dismissal – no valid reason – procedural fairness not accorded –– dismissal harsh, unjust and unreasonable – remedy awarded – reinstatement not appropriate – compensation awarded.
Mr Shaun Crowley (the Applicant) lodged an application with the Fair Work Commission (the Commission) seeking a remedy pursuant to s.394 of the Fair Work Act 2009 (the Act) in relation to his dismissal by Modcon Group Pty Ltd (the Respondent).
A conciliation was held on 27 October 2023 and a resolution was not reached. Directions were issued and the matter was listed for hearing on 17 January 2024 and 15 February 2024. The Applicant was represented by Maurice Blackburn Lawyers, and the Respondent was represented by Prosper Law.
There were no objections raised by either party regarding representation. I granted permission for both the Applicant and the Respondent to be represented by counsel. Mr Troy Spence appeared as Counsel for the Applicant, and Ms Madeline Stone appeared as Counsel for the Respondent. Representation was granted on the basis that the matter would run efficiently given the complexity of the matter, and there would not be unfairness between the parties under s.596 of the Act.
Section 396 of the Act requires satisfaction of four matters before considering the merits. The parties did not dispute the factors under s.396 of the Act. I am satisfied that the Applicant made his application within the 21-day period required by s.394(2) of the Act, that he was a person protected from unfair dismissal, earned less than the high-income threshold, that his dismissal was not a case of genuine redundancy and that the Respondent is not a small business to whom the Small Business Dismissal Code applies.
Background
The Applicant commenced full-time employment with the Respondent as a Project Manager on 5 September 2022. The Applicant became a Construction Manager with the Respondent from May 2023.
The Respondent submits that the Applicant’s conduct in the workplace deteriorated from May 2023. The Respondent called upon the following witnesses to provide evidence in response to the Applicant’s unfair dismissal claim.
Mr Corey Smith is the Operations Manager, founder and former Director of ModCon
Mrs Kirsty Smith is the current Director of ModCon
Ms Kelly Brannen is the General Manager
Mr Benjamin Doolan is a Design Manager
Mr Scott Taylor is a Project Manager
Mr Scott Gray is not associated with the Respondent but is the Structure Manager for Hutchinsons.
The Respondent raised several issues with the Applicant’s conduct through Ms Brannen’s and Mr Smith’s statements. However, these alleged issues were not flagged with the Applicant as the reasons for dismissal, nor was there evidence provided of the warnings besides Mr Smith’s statement.
On 7 July 2023, an email was sent from a construction estimator to provide a modification of the organisational chart. The Applicant sent an email to the estimator stating, “let’s not make a big deal out of an org chart, just send through the project teams can use if you don’t like it”.[1] Ms Brannen thought the email was rude and talked to Mr Smith.[2] Mr Smith stated that he spoke with Mr Crowley about how he should interact with Ms Brannen and that he should stop clashing with her on 11 July 2023.[3] The Applicant refutes that Mr Smith made any calls to him regarding this matter (Organisational Chart Email Incident).
On 20 July 2023, Mr Smith stated that he was unwell and asked the Applicant to attend a scheduled site meeting with Mr Scott Gray from Hutchinson Builders (Site Visit Incident).[4] Mr Smith received a call from Mr Gray who said that the Applicant told him that Hutchinson’s services were no longer required.[5] Mr Gray stated that nobody from the Respondent was present at the meeting and the Applicant told him that Modcon had other projects.[6]
The Applicant stated that this was not the case. Mr Smith was sick and was asked by Mr Gray if the Applicant could attend the meeting in 40 minutes. Mr Smith had later told the Applicant that he did not wake up in time for the meeting. The Applicant said he never received instructions from Mr Smith to attend the meeting, nor attend a Hutchinsons meetings without Mr Smith present. This issue was not raised before him.[7]
During this period, although unspecified, Ms Brannen and Mr Smith claim that the Applicant was bullying another employee (Bullying Incident).[8] However, this was not raised in the reasons for termination, nor flagged with the Applicant.
On 2 August 2023, Ms Brannen stated that she followed up on an invoice from Axis Building Certifiers and found an email that was sent by the Applicant about not receiving building approval for a project at Enoggera State School (Axis Certification Complaint).[9] Ms Brannen spoke to Mr Smith about this email. Mr Smith states that Ms Brannen had called him that the final payment would not be received because of a rude email sent by the Applicant.[10] Mr Smith contacted the Applicant stating that the contractors should not be spoken to in that way.[11] The Applicant states this call did not occur, this issue was never raised to him at termination and explained that the reason why he did not receive approval was that Axis would not be willing to do retrospective approvals.[12]
In early August 2023, Mr Smith stated that he and Ms Brannen had a conversation with the Applicant about recruitment costs.[13] Ms Brannen had questions surrounding this and sent an email to the Applicant (Recruitment Costs Incident). Mr Smith stated that he told Mr Crowley to stop butting heads with Ms Brannen.[14] The Applicant’s email notes the following:
“Kelly,
With all due respect don’t come at me like I have to answer to you. You can catch up on the conversions when you return.
Whatever bills are due are due under the agreements I signed.
Regards,
Shaun”[15]
Ms Brannen responded:
“Apologies Shaun, I didn’t mean to come across harshly, I just wasn’t sure if I should be paying them or a conversation had been had.
Happy to wait until I get back and we can sort it out.”[16]
On 17 August 2023, Ms Brannen stated that the Applicant did not consult her regarding engaging an external consultant (Compliance Help Incident).[17] The Applicant submitted this was not raised with him as an issue.[18]
On 22 August 2023, Ms Brannen had an issue with the Applicant not providing her details regarding the operational priorities of the business before sending it out to the business (Operational Priorities Incident).[19] The Applicant states that this was not raised as an issue.[20]
On 7 September 2023, Ms Brannen stated that the Applicant had sent an email for a training expense claim which was not approved (Training Expense Claim).[21]
It appeared consistent in the allegations that Ms Brannen did not like the way the Applicant was performing his duties, nor was this ever directly communicated to him. Nor did it appear that the Applicant was ever made aware of these alleged issues by Mr Smith. The main reason which the Respondent relied on to dismiss the Applicant occurred from a meeting on 11 September 2023.
On 11 September 2023, there was a team meeting with the Applicant, Mr Smith, Ms Brannen, Mr Doolan and Mr Taylor to discuss business processes. There were discussions led by Ms Brannen regarding how staff were to provide her with all the information she required to pay the company’s invoices.[22]
The Applicant raised that the contractors were not getting paid, and voiced concerns about the Respondent becoming insolvent.[23] Ms Brannen said that she emailed the contractors with the new payment agreement, and the contractors had accepted the new terms.[24] The Applicant expressed it was “bullshit” because he had spoken to three contractors who did not receive an email from Ms Brannen, nor did Ms Brannen accept their calls.[25] The Applicant asked for a list of contractors. Ms Brannen was alleged to reply, ‘don’t you think I am doing my job?’.[26] Mr Smith then ended the meeting.[27]
The Applicant had no further interaction with Ms Brannen at the meeting.[28] It was the Applicant’s submission that although he raised his voice with Ms Brannen, he did not shout or swear at her.[29]
The Respondent provides a different version of events. The Respondent submits that the Applicant was upset and frustrated at Ms Brannen raising his voice and becoming argumentative, repeatedly swearing at her, telling her to do a better job and refusing to de-escalate the situation by insisting the conversation be at the meeting in front of the other employees, rather than dealing with the matter privately.[30]
After the meeting, Ms Brannen called Mr Smith claiming she felt bullied by the Applicant, excluded her from conversations and prevented her from doing her job. Ms Brannen told Mr Smith if her performance was not up to scratch, that the business should find a replacement.[31] Ms Brannen received a message from Mrs Kirsty Smith that the way the Applicant conduct was not okay and was over the Applicant talking to her in the alleged manner.
On 12 September 2023, Mr Smith contacted Ms Brannen asking her not to resign and that Mr Crowley would be dismissed.[32] Ms Brannen was asked to draft the termination letter by Mr Smith.[33]
On 13 September 2023, Ms Brannen and the Applicant were working at the office. Ms Brannen’s only interaction that she had with the Applicant was saying “Good Morning”.[34]
On 14 September 2023, Mr Smith sent Mr Crowley a text message asking him to work from home, and that he needed to discuss the meeting on 11 September 2023.[35] An 8-minute phone call occurred at 4:59pm.[36] There were contested facts of the contents of the call. The Applicant states that Ms Brannen had wanted to make a complaint about the Applicant, and that Mr Smith would discuss this at his home.[37]
On 15 September 2023, Mr Smith called the Applicant. The Applicant recalled the following events:[38]
Mr Smith provided the reason for the Applicant’s dismissal was that Hutchinsons would not provide work to the Respondent if the Applicant was working with them.
Mr Gray told Mr Smith that the Applicant had an argument with Hutchinsons.
The Applicant refuted this as he had not talked to Mr Gray in months and that he would be pursuing an unfair dismissal claim as the allegations were rubbish.
If Ms Brannen’s allegation was not true, she would be sacked.
Mr Smith would call Mr Laing to confirm if this was true, and that Mr Crowley would not be sacked if the allegations were not substantiated.
Mr Smith’s recollection of the call was similar but added that the Applicant threatened to “bury” him if the Applicant was dismissed.[39] Mr Smith called Hutchinsons about Mr Smith’s conduct, then called Ms Brannen.[40] Mr Smith called Ms Brannen regarding what the Applicant had said. Ms Brannan stated that he had grounds to fire the Applicant, as he had been warned about his behaviour and had cost the company a lot of money, but if Mr Smith was worried then she would leave instead of the Applicant.[41]
The Applicant lodged his unfair dismissal application on 2 October 2023.
The Respondent also raised an issue with a concreting invoice for the Applicant’s personal address post the Applicant’s termination. I did not find this issue to be relevant given that the invoice was deducted from the Applicant’s final pay.
Assessment of Witness Credibility
Given that the substance of the matter is adduced by oral evidence, I have assessed the evidence provided by the Applicant and the Respondent.
Mr Shaun Crowley
I found Mr Crowley to be a credible witness and his evidence provided at Hearing was consistent with his statement that he has provided to the Commission. I determine Mr Crowley to be a witness of truth.
Mrs Narelle Crowley
Mrs Crowley was of assistance regarding the unfair dismissal claim. Mrs Crowley provided evidence which supported Mr Crowley’s claims in his statements which I have determined to be truthful.
Mr Corey Smith
Mr Smith’s evidence is treated with caution, and he did not prove to be a credible witness. There were inconsistencies provided in his statement and the evidence provided at Hearing. For instance, Mr Crowley was not directed to attend the Hutchinsons meeting on 20 July 2023 which the Respondent alleges the Applicant’s non-attendance was part of the reason why there was damage to the business’ reputation or relationship with customers. [42] It was uncovered that the Respondent did not warn the Applicant, and Mr Smith was responsible for not attending the meeting.
Ms Kelly Brannen
Ms Brannen’s evidence is treated with significant caution as a credible witness. The evidence that was provided in her statement was not consistent with the evidence adduced in cross-examination. Given that Ms Brannen is a major contributor of the issues arising from this matter, it appeared that her witness evidence was to provide support to the Respondent’s case rather than a clear recollection of events. For instance, Ms Brannen had stated the Applicant had sworn at her, but this was not the case.
Mrs Kirsty Smith
Mrs Smith’s evidence is treated with significant caution as a credible witness. It appeared that Ms Smith did not know what was going on in the day-to-day operation of the business besides her interactions with Mr Smith and was not present at the meeting on 11 September 2023. Her recollection of the evidence was hearsay from either Mr Smith or Ms Brannen. I assess her hearsay evidence not to be reliable.
Mr Benjamin Doolan
Mr Doolan’s evidence is treated with significant caution as a credible witness. Mr Doolan provided substantive evidence on the 11 September 2023 meeting and that he had taken notes of the meeting. This was not provided to the Commission. Furthermore, Mr Doolan did not provide any particulars regarding the incident, and appeared to provide evidence that would support the Respondent’s claim rather than provide an accurate account of this event.
Mr Scott Gray
Mr Gray’s evidence is treated with caution and did not appear to be a credible witness. Mr Gray could not particularise why the Applicant caused reputational harm with Hutchinsons or had enough interaction with the Applicant regarding why the contract would not be renewed. It appeared that Ms Brannen had asked Mr Gray to put a statement in support of the Respondent, rather than provide credible evidence.
Mr Scott Taylor
Mr Taylor did not provide much evidence at the Hearing, and only provided an account of the meeting on 11 September 2023. I did not find much probative value in his evidence.
Overall assessment of the Respondent’s evidence
The Respondent submitted that ‘where there are inconsistencies regarding precisely what was said and in what order, that is to be expected given the vagrancies of memory and the passage of time. If the statements of each of those witnesses slavishly repeated certain phrases, no doubt there would have been allegations of collusion’.[43]
I disagree with the analysis of the Respondent. Mr Crowley was a senior employee in an organisation with 33 staff. Given the nature of the summary dismissal and allegation of serious misconduct, I place doubt that a witness of the Respondent could not recall key facts of what was said to Ms Brannen by the Applicant on 11 September 2023. The Respondent’s evidence was not consistent with what was alleged to have occurred on this date. It appeared that the some of the witnesses for the Respondent were under pressure to provide a response that was favourable to its case rather than be candid. The Respondent’s credibility of their allegations was weakened through cross-examination of their statements.
Was the Applicant unfairly dismissed?
Section 387 of the Act provides the criteria and considerations the Commission must take into account when deciding if the dismissal was harsh, unjust, or unreasonable. As required by the Act, I consider the following:
(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.
a)valid reason for the dismissal;
It is well established that the factual basis for the reason for dismissal will not of itself demonstrate the existence of a valid reason.[44] It must, as s.387(a) makes clear, be a valid reason for dismissal. To be a valid reason, the reason for the dismissal should be “sound, defensible or well founded”[45] and should not be “capricious, fanciful, spiteful or prejudiced.”[46] As summarised by Deputy President Asbury in Smith v Bank of Queensland Ltd a “dismissal must be a justifiable response to the relevant conduct or issue of capacity”.[47] The Commission must consider the entire factual matrix in determining whether an employee’s termination was for a valid reason.[48]
The reason for dismissal were provided in the Applicant’s termination letter. The Applicant had engaged in serious misconduct for the following reasons:
The Applicant had inappropriate communication with other employees on 11 September 2023.
Recent communications with customers and consultants had a financial impact on the Respondent’s company along with causing damage to their reputation, viability or profitability.
The Respondent submitted that the Applicant’s conduct was in breach of his employment contract. Given that the main contentions surrounding the unfair dismissal is on whether a valid reason exists, I have provided my consideration of the evidence provided to the Commission on each reason. In summary, there was no valid reason substantiated by the Respondent.
Inappropriate communication with other employees on 11 September 2023
The first allegation surrounds the Applicant’s conduct during a meeting on 11 September 2023. The Applicant recalls himself, Mr Scott Taylor, Ms Kelly Brannen and Mr Corey Smith in attendance at the meeting. The Respondent state that Adele Menhard and Mr Benjamin Doolan were also in attendance.
The Respondent alleges that the Applicant swore and berated Ms Brannen in the presence of all attendees about a discussion of unpaid bills from the creditors. The Applicant humiliated Ms Brannen by stating “do a better job” after requesting a summary of communications from creditors. Ms Brannen stated she was happy to provide this to the Applicant, but he refused to receive these emails.[49] The Respondent claims the Applicant’s behaviour during this meeting was a valid reason for summary dismissal.
The Applicant refutes this raising that the discussion was about company invoices not being paid and it was ‘bullshit’ that the contractors were not accepting the new payment terms. There was tension arising from Ms Brannen and the Applicant. However, he did not shout, berate or swear at Ms Brannen. The Applicant acknowledges that he raised his voice when speaking with Ms Brannen and said ‘bullshit’ when discussing the invoices.
There are serious questions of credibility that was raised in the Respondent’s evidence. It is a serious allegation raised by the Respondent that the Applicant berated and swore at another coworker. I am not reasonably satisfied that the reason for dismissal was substantiated. I reiterate the Briginshaw principle and the assessment of fact on the balance of probabilities, Dixon J said:
“The truth is that, when the law requires the proof of any fact, the tribunal must feel an actual persuasion of its occurrence or existence before it can be found. It cannot be found as a result of a mere mechanical comparison of probabilities independently of any belief in its reality. No doubt an opinion that a state of facts exists may be held according to indefinite gradations of certainty; and this has led to attempts to define exactly the certainty required by the law for various purposes. Fortunately, however, at common law no third standard of persuasion was definitely developed. Except upon criminal issues to be proved by the prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters “reasonable satisfaction” should not be produced by inexact proofs, indefinite testimony, or indirect inferences.[50]
The Applicant’s conduct did not amount to any form of misconduct or serious misconduct during the meeting on 11 September 2023. Mr Corey Smith’s evidence did not provide a reliable or credible account of events. Mr Smith did not appear to raise issues surrounding the Applicant’s conduct, given that the Applicant was working in the office for two days after the alleged incident on 11 September 2023.
Ms Brannen’s dissatisfaction with the Applicant questioning her work, and her wishing to resign appeared to be the main driver of Mr Crowley’s dismissal to keep Ms Brannen from resigning. I have provided the transcript excerpt below:
MR SPENCE: Mr Smith, if Mr Crowley’s conduct was so serious on 11 September in relation to Ms Brannen, why on earth did you let him keep turning up to the workplace?
MR SMITH: Don’t know.
MR SPENCE: Why on earth did you let him keep turning up to the workplace in circumstances where he might be interacting with the person who’d complained about him?
MR SMITH: I can’t remember.
MR SPENCE: Don’t you think, as a manager of people, if you’ve got someone who you say is engaged in conduct of yelling and swearing at an employee, that you should have taken every step to make sure those people didn’t come into contact?
MR SMITH: Yes.
MR SPENCE: It’s your version, isn’t it, that Mr Crowley’s conduct was so serious that it warranted summary termination; correct?
MR SMITH: Correct.
…
MR SPENCE: I want to suggest to you that if Mr Crowley had engaged in such serious conduct towards Ms Brannen on 11 September, you would have taken every step to make sure he never came back to the workplace?
MR SMITH: I was trying to take the right steps to make sure I’m right.
MR SPENCE: And yet you let him turn back up, didn’t you?
MR SMITH: I can’t remember if he was there on the 13th.
MR SPENCE: All right?
MR SMITH: I was not there.
MR SPENCE: Well, you didn’t stop him from coming back to the workplace, and you let him work on 12 September; correct?
MR SMITH: I can’t remember.
MR SPENCE: You let him work on 13 September; correct?
MR SMITH: I can’t remember.
MR SPENCE: You told him to work from home on 15 September?
MR SMITH: Correct.
MR SPENCE: So from this very serious incident that happened on 11 September, you continued to allow Shaun Crowley to turn up for work for, not one day, not two days, but three days; correct?
MR SMITH: Two days he was there. I don’t believe he was there for three.
…
MR SPENCE: You knew that Ms Brannen was the one who’d complained about Mr Crowley; correct?
MR SMITH: Correct.
MR SPENCE: Yet she was the person who you asked to draft Mr Crowley’s dismissal letter on 12 September; correct?
MS SMITH: Correct.
MR SPENCE: And she’d threatened to resign if you didn’t sack Mr Crowley; correct?
MR SMITH: Correct
MR SPENCE: Yet she was the person who you asked to draft Mr Crowley’s dismissal letter on 12 September; correct?
MR SMITH: Correct.
MR SPENCE: Surely, Mr Smith, you would understand that getting a complainant against another employee to write the other employee’s dismissal letter is not an appropriate thing to do?
MR SMITH: I believe that was her job.
MR SPENCE: Even though she was the person who complained about Mr Crowley?
MR SMITH: Correct
MR SPENCE: Surely you would understand that that would have created a conflict of interest?
MR SMITH: No, because she was the only one that could do that.[51]
Ms Brannen’s evidence was also not credible in supporting the reason for dismissal. Given that the Applicant was alleged to have been ‘aggressive’ with Ms Brannen, there were no further concerns regarding the Applicant continuing to work after the events of 11 September 2023. The transcript excerpt is provided below:
MR SPENCE: All right. It’s the case, isn’t it, Ms Brannen, that, after the meeting, you effectively said to Mr Smith, ‘If Mr Crowley isn’t sacked, I’m going to resign.’ Correct?
MS BRANNEN: No, I actually said, at that stage, that I felt like I’d been bullied enough and I was happy to go and look for another job and I was resigning.MR SPENCE: It is the case, isn’t it, that really what you were suggesting to Mr Smith was that if he didn’t dismiss Mr Crowley, you would be resigning?
MS BRANNEN: Not at all.
MR SPENCE: You never put that ultimatum to him?
MS BRANNEN: Not at that time, no.
MR SPENCE: All right. But you didn’t have a very good opinion of Mr Crowley, did you?
MS BRANNEN: To be honest, up until that actual meeting, I didn’t mind working with him.
MR SPENCE: But, after that, you had a low opinion of him?
MS BRANNEN: That’s correct.
MR SPENCE: You worked from home on 12 September?
MS BRANNEN: Yes, I did.
MR SPENCE: You did that because you were concerned you might come in contact with Mr Crowley?
MS BRANNEN: No, I had medical appointments.
MR SPENCE: All right. So not being at work on 12 September had nothing to do with what had occurred on the 11th?
MS BRANNEN: Not at all.
…
MR SPENCE: Did you ring Mr Smith and say, ‘I feel very unsafe because Mr Crowley is in the office with me’?
MS BRANNEN: No, I didn’t
MR SPENCE: Did you ring Mr Smith and say, ‘I think my work health and safety is at jeopardy because Mr Crowley is in the workplace’?
MS BRANNEN: No, I didn’t.
MR SPENCE: Did you ring up Mr Smith and say, ‘Given how I was treated on the 11th, I’ve got real concerns about Mr Crowley being in the workplace with me’?
MS BRANNEN: No, I didn’t.
MR SPENCE: I put to you that if Mr Crowley had, in fact, acted the way you said he acted on 11 September, you would have had those concerns?
MS BRANNEN: No, I wouldn’t have.
MR SPENCE: Why didn’t you have those concerns?
MS BRANNEN: I didn’t feel that he was going to physically assault me, if that’s what you’re implying.
…
MR SPENCE: You felt safe to be in the workplace with Mr Crowley on 13 September; correct?
MS BRANNEN: I guess, yes.[52]
Furthermore, Mr Doolan’s evidence was not credible and was inconsistent with his statement and the evidence provided by Ms Brannen and Mr Smith.
MR SPENCE: Mr Doolan, what you say in your statement is words to the effect of, or actual words, that Shaun raised his voice, used an aggressive tone and spoke a number of curse words directly at Kelly. Do you see that at paragraph 4 of your statement?
MR DOOLAN: Yes.
MR SPENCE: Were you shocked by the words that were used?
MR DOOLAN: Yes.
MR SPENCE: If you were so shocked by the words that were used, how come you’ve not included any of them in your statement?
MR DOOLAN: The words that were used were covered by what I said in my statement.
MR SPENCE: Well, you don’t say in your statement, ‘Shaun said “Fuck” to Ms Brannen’, do you?
MR DOOLAN: I don’t specifically mention the word ‘fuck’, no.
MR SPENCE: Mr Doolan, I want to suggest to you that if Mr Crowley had said the word ‘fucked’ directed at Ms Brannen, that you would have included that in your statement?
MR DOOLAN: Yes, so you’re suggesting that it’s a word of such impact that it would have been memorable and that I would have specifically remembered that word being used.
MR SPENCE: Correct, and you haven’t included it in your statement, have you?
MR DOOLAN: No, because I’ve chosen to use ‘curse words’ as a term to cover multiple curse words being said.
MR SPENCE: I want to suggest to you that if the word ‘fucked’ had been used and directed against Ms Brannen, that you would have included it in your statement because it would have had such an impact. What do you say to that?
MR DOOLAN: No.
MR SPENCE: All right. Now, forgive me if I have already answered this question, but did you take notes on what occurred at that meeting on 11 September 2023?
MR DOOLAN: I did take some very basic notes.
MR SPENCE: Did you take any notes that recorded the interaction between Ms Brannen and Mr Crowley?
MR DOOLAN: Just general single dot point to say that the interaction had happened.
MR SPENCE: Right, so what you say in your statement about what Mr Crowley said to Ms Brannen is entirely from your memory. Is that correct?
MR DOOLAN: And the dot point note which was – is also – I would – with – yes, captured that statement.
MR SPENCE: Right. And that’s not attached to your statement is it?
MR DOOLAN: No, it’s not[53]
The evidence provided by the Respondent was not credible regarding the Applicant’s conduct at the meeting. It did not appear that the Applicant was swearing or berating Ms Brannen although there may have been some discomfort by the attendees of the meeting. Therefore, the first reason for termination was not valid given it was not substantiated.
Given the seriousness of the allegation, no witness from the Respondent was able to clearly articulate the swearing or berating that was alleged to occur. Furthermore, after assessing the conduct of the Respondent post this meeting, the Applicant was still attending the workplace. This indicates that the Applicant’s conduct was not at a level of serious misconduct which would require a prompt action if the Respondent’s accounts were true.
(2) Recent communications with customers and reputational damage
The Respondent’s second reason for dismissal surrounded Mr Crowley’s ‘communications with customers and consultants which had a financial impact on the Respondent’s company along with causing damage to their reputation’. Their reasoning comes from a lost contract with Hutchinsons Builders and the Applicant’s communications with Axis.
Mr Smith alleges that the Respondent had their income reduced from $300,000 per month to $100,000, and it took two months to resolve issues with Axis.[54] There was no financial evidence supporting this claim.
Mr Scott Gray is a Structure Manager for Hutchinson Builders who provided evidence at the Hearing. In the assessment of his evidence, I did not find Mr Gray to be honest in some of his answers, which appeared to be influenced by the statements he was asked to make on behalf of the Respondent. I did not find Mr Gray’s evidence during cross-examination credible.
During cross-examination, the aspects that I did find to be truthful were:
Mr Gray did not write any correspondence, given the allegation that the Applicant was ‘destroying the relationship’ nor did he feel the need to.
The Applicant did not attend a contractor meeting,
Mr Gray called Mr Smith regarding concerns with the Applicant’s attitude.
Mr Gray stated that there was no relationship between Mr Crowley and himself and that he had hardly known the Applicant.[55]
Modcon is a regular customer of Hutchinsons,
An internal decision was made to go with another contractor rather than Modcon due to internal processes and trialling a different business model to have a few specialists to see if it works.[56]
The Applicant told Hutchinsons that they were not a priority, and their work is not really needed because other work was obtained.
The Applicant stated that he had not attended meetings with Hutchinson Builders without Mr Smith’s presence, and that he did not know the date when Mr Gray organised the contractor meeting. Regarding the meeting on 20 July 2023, Mr Smith stated that the Applicant was not directed to attend.[57]
The Applicant had a conversation with Mr Matt Laing regarding the other work Modcon’s were performing. I accept that Mr Crowley said a comment to Hutchinsons which may not have been well received by the Respondent. However, there was no clear link between the Applicant’s alleged conduct and loss of business. As a result, I do not accept that the Applicant’s communication caused a financial impact on the Respondent, or cause damage to their reputation. If this was an issue for the Respondent, this could have been flagged to the Applicant or a written warning could have been issued.
The practical reality was that Hutchinsons wanted to trial a different business model which resulted in the Respondent not obtaining the contract rather than the Applicant’s conduct. The Respondent eventually did pick up a contract with Hutchinsons indicating that their reputation was not damaged. This allegation was not substantiated by the Respondent nor was this reason clearly put to the Applicant. This supports a finding that it was not a valid reason for dismissal.
The Respondent’s other example that the Applicant had caused reputational harm was that he eroded the professional relationship between the Respondent and their building certifier, Axis. This was not well substantiated. Although the Applicant appears to be brash in his correspondence, this could have been addressed internally given the context surrounding the emails.
Ms Brannen told Mr Smith that they were not getting payment for a final claim for Enoggera State School as there was an issue with the certification and the certifiers had pulled out of the job because of a rude email that Mr Crowley sent. Mr Smith claimed he tried to smooth it over with Axis but were not willing to help them in the future.
On 28 July 2023, the Applicant wrote the following email to Andrew Grimmond who is a building certifier from Axis:
“Andrew, please refer this to your manager and for him to call us after he has reviewed this as I have no faith that you know enough to make a call on this matter.
Noted, the councils comment regarding a local storm water pipe 200mm below top of slab and 1675mm from any footing.
Take this a formal complaint against Axis. It is extorsion that you request payment upfront for this level of service.”
Mr Grimmond replied with the following email:
“Hi Shaun,
If you’re not happy with the services I have provided, you are welcome to make a complaint with the QBCC. However, please note to inform them that you have done building works again without a Building Approval in place.
We won’t be providing retrospective building approvals which was made clear previously as this impacts our insurances.
As you have completed these works now without a Building Approval we wont be proceeding any further and suggest you seek another certifier who can take this on.”
The Applicant’s reasoning for these emails was that Axis Building insisted on ModCon getting their planner to provide additional documents costing $800. At the time of the email, the structure of the project was already built, and Axis no longer wanted to do retrospective approvals. The additional documents would not change the approval that Axis had already known about the known condition.
The Respondent failed to adduce evidence that supported the claim that Axis did not want to provide a building approval nor provide a statement or evidence from Axis that they would not assist the Respondent in the future because of the Applicant’s conduct. Upon the evidence provided, it appeared Axis’ main issues was surrounding the retrospective building approvals. This reason for dismissal has not been substantiated by the Respondent.
3. Considering the factual matrix of the dismissal
As stated above, a dismissal must be a justifiable response to the relevant conduct or issue of capacity. The Respondent has come up with a multitude of reasons why the Applicant should be dismissed (primarily by Ms Brannen), besides the main allegations raised above.
a)Organisation Chart email – 7 July 2023
b)Recruitment Costs Incident – 7 August 2023
c)Compliance Help Incident – 17 August 2023
d)Operational priorities incident – 22 August 2023
e)Training expenses claim – 7 September 2023
f)Bullying allegation of other staff – July to August 2023
The above matters appeared to be minor grievances which were never flagged with the Applicant during dismissal, and I do not find the bullying allegation to have been substantiated. These issues appear to be communication issues between Ms Brannen and the Applicant. I find these reasons are not substantive, and relevant to the unfair dismissal given that they were not flagged in the termination.
The Respondent failed to substantiate any reason for dismissal. It appeared that some of the Respondent’s staff including Mrs Smith, and Ms Brannen had some disdain for the Applicant but there was never a reason based on conduct or capacity that the Applicant could justifiably be dismissed.
In consideration of all the reasons provided, the Applicant did not have a sound, defensible or well-founded reason of the Applicant’s dismissal. This strongly finds in favour of finding that the dismissal was harsh, unjust and unreasonable.
(b) Notification of reason and (c) Opportunity to respond:
Although the employer is not required to take any ‘particular steps’ in carrying out the dismissal, it is commonly accepted practice that notice in explicit and plain and clear terms must be given regarding termination of an employee.[58] It is a statutory protection derived from the principle of procedural fairness that require employees to be treated fairly before a decision is made.[59]
I do not accept the Respondent’s argument that the Applicant was given an opportunity to reasons for dismissal on 14 September 2023, and 15 September 2023. It appeared that the Respondent intended to terminate the Applicant regardless of his response. It was evident through his conversation with Ms Brannen on 12 September 2023, along with the failure to particularise the issues about Hutchinsons to the Applicant. The Applicant was not notified of the reason in explicit, plan and clear terms. It was ambiguous.
The Applicant was summarily dismissed and therefore did not have a genuine opportunity to respond. This strongly contributes to a finding that the dismissal was harsh, unjust or unreasonable.
(d) Unreasonable refusal by the employer to allow the Applicant a support person:
There is no positive obligation on an employer to offer an employee the opportunity to have a support person and is only relevant when an employee asks to have a support person present in a discussion relating to dismissal and the employer unreasonably refuses.[60] The Applicant was not in a position to request a support person as he was summarily dismissed,
I do not consider this to be a relevant factor in determining whether the dismissal was harsh, unjust or unreasonable.
(e) Warning of unsatisfactory performance before the dismissal:
The dismissal could have been an issue of performance. However, no clear warning was ever put to the Applicant regarding these issues. I do not accept the evidence of Mr Smith that these warnings were provided. The evidence that was provided appeared to be apportioning blame to the Applicant without any evidence to corroborate the allegations with substantive evidence. Nothing was recorded or documented.
This contributes to a finding that the dismissal was harsh, unjust or unreasonable given that the Applicant was not given any formal warning about his disagreements shared by Mr Smith or Ms Brannen.
f) Size of employer’s enterprise, and (g) impact on procedures caused by absence of dedicated human resources:
The Respondent states that it is a small enterprise which employs limited operational management staff. Ms Brannen is the sole employee charged with human resources management. The Respondent states that its ability to respond to Mr Crowley’s conduct was affected given the size of its enterprise. The Applicant states that it is not a relevant circumstance considering the importance of procedural fairness were particularly serious.
I find that the size of the employer’s enterprise did have an impact on the dismissal. It appeared that Ms Brannen undertaking the procedure to draft the termination letter, Ms Smith not properly investigating the incident on 11 September 2023, and Mr Smith did not handle the differences of Mr Crowley and Ms Brannen well. However, I do not consider this factor to have significant weight in determining whether the dismissal was harsh, unjust or unreasonable given that it was not onerous for the Respondent to have common courtesy in dealing with some of their issues through communicating these grievances with the Applicant.
(h) any other matters that the FWC considers relevant:
The Applicant and Respondent have submitted that there is no significant relevance of this consideration. I accept this from the parties, and I do not consider this to be a relevant factor in determining whether the dismissal was harsh, unjust or unreasonable.
Conclusion
The dismissal was harsh given that the Applicant was summarily dismissed with no warning or clear reason for his dismissal, had no genuine opportunity to respond, was not accorded procedural fairness and placed him financial hardship. It was unjust given that the Applicant was not given a valid reason for dismissal and there was no wrongdoing regarding his conduct. It was a fabricated reason given Ms Brannen’s disagreements with the Applicant. The dismissal was unreasonable given that there were allegations that were made about the Applicant were not substantiated, investigated, put forward to him, or given him an opportunity to improve or respond.
If there were genuine issues surrounding Mr Crowley’s interactions with Ms Brannen, a more formal process could have been implemented before dismissal. It would not have warranted summary dismissal. This is poor employee management.
The Respondent will need to reflect on its practices and process regarding how they manage their employees in the future. It is not onerous to have a conversation with the Applicant if there were any issues or concerns regarding his conduct or behaviour. If the Respondent had dealt with the issues of the Applicant’s approach to his colleagues through written warning, this could have better substantiated the reasons for dismissal. No issues were raised with the Applicant.
If the relationship between the Applicant and Ms Brannen did not improve and caused a detriment to the business, I could understand a potential reason for dismissal. The way the dismissal was sprung on to the Applicant demonstrated a lack of common courtesy or respect. Given that this matter is a textbook example of an unfair dismissal, I will not hold a further hearing on the remedy. There is enough material to determine the remedy before me and I make an assessment of remedy below.
Remedy
Given that I have found that the Applicant’s dismissal was unfair, it is necessary to consider the question of remedy. The Applicant has made an application under s. 394 of the Act seeking remedy for unfair dismissal.
Pursuant to section 390 of the Act, this Commission may order:
“390 When the FWC may order remedy for unfair dismissal
(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of compensation to a person, if:
(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) The FWC may make the order only if the person has made an application under section 394.
(3) The FWC must not order the payment of compensation to the person unless:
(a) the FWC is satisfied that reinstatement of the person is inappropriate; and
(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.”
The Applicant and Respondent have stated that reinstatement is something that they do not wish to consider. Given the matter history and animosity between the Applicant and Respondent, I do not find this to be an appropriate remedy.
Section 392 sets out the considerations for awarding compensation:
“Compensation
(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.
Criteria for deciding amounts
(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:
(a) the effect of the order on the viability of the employer’s enterprise; and
(b) the length of the person’s service with the employer; and
(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and
(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and
(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and
(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and
(g) any other matter that the FWC considers relevant.
Misconduct reduces amount
(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.
Shock, distress etc. disregarded
(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.
Compensation cap
(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:
(a) the amount worked out under subsection (6); and
(b) half the amount of the high income threshold immediately before the dismissal.
(6) The amount is the total of the following amounts:
(a) the total amount of remuneration:
(i) received by the person; or
(ii) to which the person was entitled; (whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and
(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.”
The established approach to assessing compensation in unfair dismissal cases was set out in Sprigg v Paul Licensed Festival Supermarket,[61] and has been applied and developed by Full Benches of the Commission.[62]
The assessment of compensation involves a four-step process; however, the note guidelines are not a substitute for the words in the Act:
“Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost). I am also required to consider the length of service with the employer[63] and the ability to find a new role as a relevant factor in calculating compensation per s392(2).
Step 2: Deduct monies earned since termination.[64]
Step 3: Discount the remaining amount for contingencies.[65]
Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount they would have received if they had continued in their employment.”
Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).
The Applicant commenced work with the Respondent for one year and ten days. The Applicant would have remained employed for at least 26 weeks had he not been terminated as there were no performance issues flagged with the Applicant, nor did the Applicant engage in any form of misconduct. The Applicant was on a salary of $140,000 per annum including superannuation. The Applicant also received a $15,000 motor vehicle allowance.
Thus, I find that the maximum compensation that the Applicants would have received is 26 weeks which amounts to $77,500 including the motor vehicle allowance.
Step 2: Deduct monies earned since termination.
The Applicant has not been employed from dismissal to 5 February 2024 when he received medical clearance to return to his duties. The Applicant has started his own business and returned to work as a Project Construction Manager on a contract basis where he invoiced the following amounts of $2,369.43 and $3,949.50. I am satisfied that the Applicant attempted to mitigate his loss once he was medically cleared to work.
A deduction of $6,318.93 will be made of the monies earnt since termination. The compensation cap is $71,181.07.
Step 3: Discount the remaining amount for contingencies.
Although the Respondent has flagged several issues with the Applicant, it was not substantiated. Furthermore, I am not persuaded that the outcome would have been fair had there been a process. As a result, I have made no deduction for contingencies.
Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.”
In Bowden v Ottrey Homes Cobram and District Retirement Villages,[66] the Full Bench noted that in relation to the fourth step, the usual practice is to settle a gross amount and leave taxation for determination. I will leave the issue of taxation for determination by the Respondent.
Viability
There is a potential issue of viability given the references to cash flow of the business by the Respondent. I am mindful that the remedy awarded could provide difficulties for the Respondent to repay the amount. I have provided additional time for the Respondent to pay the Applicant in instalments. I have divided the order for compensation into monthly instalments for the next 6 months.
Order
The Respondent is ordered to pay the sum of $71,187.07 over a period of six months. The Respondent is to pay in 6 instalments. The Respondent is required to follow the instalment schedule and pay 11% superannuation on top of each instalment to the Applicant’s nominated bank account. The instalments schedule is as follows:
| Instalment Due Date | Amount |
| 27 June 2024 | $11,863.51 |
| 25 July 2024 | $11,863.51 |
| 29 August 2024 | $11,863.51 |
| 26 September 2024 | $11,863.51 |
| 24 October 2024 | $11,863.51 |
| 27 November 2024 | $11,863.52 |
I Order accordingly.
DEPUTY PRESIDENT
Appearances:
T. Spence of Counsel, instructed by Maurice Blackburn Lawyers for the Applicant.
M. Stone of Counsel, instructed by Prosper Law for the Respondent.
Hearing details:
Brisbane.
17 January and 15 February 2024
Final written submissions:
4 March 2024
[1] Statement in Reply of Shaun Crowley, 4; Statement of Kelly Brannan [7].
[2] Statement of Kelly Brannen [8].
[3] Statement of Corey Smith [18].
[4] Ibid [21].
[5] Ibid.
[6] Statement of Scott Gray [5].
[7] Statement in Reply of Shaun Crowley, 5.
[8] Statement of Corey Smith [4]-[16]; Statement of Kelly Brannen [14]-[21].
[9] Statement of Kelly Brannen [22].
[10] Statement of Corey Smith [34].
[11] Ibid [35].
[12] Statement of Shaun Crowley, [106]-[107].
[13] Statement of Corey Smith [37].
[14] Ibid [39].
[15] Statement of Kelly Brannen, Exhibit KCB-8.
[16] Ibid.
[17] Statement of Kelly Brannen [33]-[34].
[18] Statement of Shaun Crowley [110]-[111].
[19] Statement of Kelly Brannen [37].
[20] Statement of Shaun Crowley [112]-[113].
[21] Statement of Kelly Brannen [42]-[43].
[22] Statement of Shaun Crowley [30].
[23] Ibid.
[24] Ibid.
[25] Ibid.
[26] Ibid.
[27] Ibid.
[28] Ibid.
[29] Ibid [33]-[34].
[30] Statement of Corey Smith [49]-[51]; Statement of Kelly Brannen [44]-[51].
[31] Statement of Kirsty Brannen 52.
[32] Statement of Mr Corey Smith 57.
[33] Ibid 54.
[34] Statement of Kirsty Brannen 55.
[35] Statement of Shaun Crowley, Annexure SC-03; Statement of Corey Smith, Exhibit CAS-1.
[36] Statement of Shaun Crowley [44]-[45].
[37] Ibid [43].
[38] Ibid [47].
[39] Statement of Corey Smith [62].
[40] Statement of Shaun Crowley [63].
[41] Ibid [64]-[65].
[42] Transcript of Hearing Day 1 PN518 – PN572.
[43] Respondent’s Closing Submissions, [34].
[44] Raj Bista v Group Pty Ltd t/a Glad Commercial Cleaning[2016] FWC 3009.
[45] Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373.
[46] Ibid.
[47] [2021] FWC 4 at 118.
[48] Commonwealth of Australia (Australian Taxation Office) t/a Australian Taxation Office v Shamir[2016] FWCFB 4185, [46] citing Allied Express Transport Pty Ltd v Anderson (1998) 81 IR 410, 413.
[49] Form F3.
[50] (1938) 60 CLR 336 per Dixon J, at pp.362-363.
[51] Transcript of Hearing Day 1 PN753 – 781.
[52] Ibid PN980 – PN1015.
[53] Transcript of Hearing Day 2 PN1588 - PN1619.
[54] Statement of Corey Smith 78.
[55] Transcript of Hearing Day 1, PN1224
[56] Ibid PN1291.
[57] Transcript of Hearing Day 1 – PN518 – PN572
[58] Chubb Security Australia Pty Ltd v Thomas (2000) AIRCFB at [41] Print S2679 (McIntyre VP, Marsh SDP and Larkin C); Crozier v Palazzo Corporation Pty Ltd [2000] 98 IR 137 at 73 (Ross VP, Acton SDP and Cribb C); Previsic v Australian Quarantine Inspection Services, Print Q3730 (AIRC, Holmes C, 6 October 1998). The principles still apply to the provisions of s.389(b) and (c) of the Fair Work Act 2009 (Cth), see William Eskander v Visy Board Pty Ltd [2021] FWC 3122 (Harper-Greenwell C) upheld in [2021] FWCFB 6036.
[59] Crozier v Palazzo Corporation Pty Ltd [2000] 98 IR 137 at 73 (Ross VP, Acton SDP and Cribb C).
[60] Explanatory Memorandum to Fair Work Bill 2008 at para. 1542.
[61] (1998) 88 IR 21.
[62] Bank of Sydney Ltd T/A Bank of Sydney v Repici [2015] FWCFB 7939.
[63] Fair Work Act 2009 (Cth) s392(2)(b) -(c) and s392(2)(g).
[64] Ibid s392(2)(e).
[65] Ibid s392(2)(a), (d) and (f).
[66] [2013] FWCFB 431.
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