Silver v Rogers & Rogers - [2012] FMCA 674

FEDERAL MAGISTRATES COURT OF AUSTRALIA

SILVER v ROGERS & ROGERS

[2012] FMCA 674

INDUSTRIAL LAW – Termination in breach of a general protection – s.351 Fair Work Act 2009 (Cth) – discrimination on grounds of age and health – s.44 Fair Work Act 2009 (Cth) – contravention of provision of National Employment Standards – s.117 Fair Work Act 2009 (Cth) – termination entitlements – requirements for termination notice – s.360 Fair Work Act 2009 (Cth) – reverse onus engaged – health an operative reason for termination – declarations made – s.545(2) Fair Work Act 2009 (Cth) – assessment of compensation for contraventions – s.539 Fair Work Act 2009 (Cth) – imposition of penalties.

Fair Work Act 2009 (Cth), ss.44, 117, 340, 342, 351, 360, 361, 539, 545

Australian Licenced Aircraft Engineers Association v International Aviation Service Assistance Pty Ltd [2011] FCA 333
Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8
Barclay v Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC 14
Bostik (Australia) Pty Ltd v Gorgevski (No.1) (1992) 36 FCR 20
Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2010] FCA 590
Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2012] FCA 563
Jones v Queensland Tertiary Admission Centre Ltd (No.2) [2010] FCA 399
Kelly v Fitzpatrick [2007] FCA 1080
Mason v Harrington Corporation Pty Ltd t/as Pangaea Restaurant and Bar [2007] FMCA 7
Trade Practices Commission v TNT Australia Pty Ltd (1995) ATPR 41-375

Applicant:

RAYMOND JOHN SILVER

Respondent:

ROGERS & ROGERS AS TRUSTEES FOR THE SHELMIER DISCRETIONARY TRUST

File Number:

BRG 92 of 2011

Judgment of:

Burnett FM

Hearing dates:

24 and 25 August 2011

Date of Last Submission:

25 August 2011

Delivered at:

Brisbane

Delivered on:

8 August 2012

REPRESENTATION

Counsel for the Applicant:

Mr G. Rebetzke

Solicitors for the Applicant:

Roberts & Kane Solicitors

Counsel for the Respondent:

Mr D. Pratt

Solicitors for the Respondent:

Ferguson Cannon Lawyers

ORDERS

I order and declare that the respondent contravened s.351 Fair Work Act 2009 (Cth).
I order that the respondent pay a penalty of $2,000.00 in respect of such contravention.
In respect of the s.351 Fair Work Act 2009 (Cth) contravention, I order that the respondent pay the applicant the sum of $15,000.00 by way of compensation pursuant to s.545(2) Fair Work Act 2009 (Cth), made up as $2,000.00 for distress and $13,000.00 in lost opportunity damages.
I order and declare that the respondent contravened s.44(1) Fair Work Act 2009 (Cth).
I order that the respondent pay a penalty of $500.00 in respect of such contravention.
In respect of the s.44 Fair Work Act 2009 (Cth) contravention, I order that the respondent pay the applicant the sum of $5,417.25 by way of compensation for non-payment of s.117 Fair Work Act 2009 (Cth) entitlements pursuant to s.545(2) Fair Work Act 2009 (Cth).
I order that the respondent pay the applicant interest upon the sums the subject of orders 3 and 6 assessed at $3,180.38.
I order that all monies the subject of these orders be paid within twenty-eight (28) days of these orders.

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT BRISBANE

BRG 92 of 2011

RAYMOND JOHN SILVER

Applicant

And

ROGERS & ROGERS AS TRUSTEES FOR THE SHELMIER DISCRETIONARY TRUST

Respondent

REASONS FOR JUDGMENT

Introduction

In July 2010 Raymond John Silver (Silver) was terminated from his employment by the respondent, Rogers & Rogers as Trustees for the Shelmier Discretionary Trust. Terrance Walter Rogers (Rogers) was the principal of the Trust. Silver complains that he was terminated in contravention of a general protections provision of the Fair Work Act 2009 (Cth) (FW Act), specifically s.351, because of his age and health. Rogers denies the allegation. He says that Silver was terminated because of the economic downturn. In addition, Silver complains that in contravention of s.44(1) FW Act he was not paid his due termination benefits in accordance with s.117 FW Act. Silver now prosecutes a claim under the civil remedy provisions seeking compensation of penalties in respect of the alleged contraventions.

Facts

Silver is an older man now aged 68 (born 16 January 1944). He says that he commenced part time employment with Rogers’ business, TWR, as an accountant on or about 1 February 2005 before becoming a permanent employee on or about 27 June that year.[1] TWR is an accountancy practice owned and operated by the respondent and in respect of which Rogers is the principal. He maintains that he continued in that employment until his dismissal on 12 July 2010. Although Silver was an accountant by profession, he also undertook various administrative functions within TWR. Subsequently, after Rogers was elected a Member of Parliament in September 2005, Silver was appointed office manager and undertook significantly more managerial work and less fee earning work. After Rogers left Parliament following the 2006 election and returned to the practice, Silver continued to undertake administrative duties. This was particularly so when Rogers was ill as a result of heart problems in late 2009 and continuing into 2010.
[1] I note that at paragraph 3 of his statement of claim he says that he was employed from about 1 July 2004. That claim is plainly incorrect. His evidence on commencement of full time employment does however coincide with Rogers’ response in his defence and is consistent with his group tax employee form filed with the ATO.
In late February 2010 Silver himself suffered a bout of pneumonia and underwent a number of tests which led to him being diagnosed with a serious heart condition. He worked until 5 March 2010 when he received a phone call at work from the Prince Charles Hospital requesting that he attend the hospital. A number of days later he underwent a triple bypass operation and was subsequently discharged from hospital on 12 March 2010. However, on 19 March 2010 he was readmitted due to an infection in his leg. He states that he contracted golden staph following his initial admission. He was finally discharged from hospital on 18 May 2010 before receiving a clearance to return to work dated 11 June 2010 from Dr Paul Angel. The certificate is curiously expressed, stating that Silver “could restart his work duties since June 15, 2010.”
Despite the inappropriate tense I am satisfied that the email was forwarded on 11 June 2010, notwithstanding the fact that the date placed into evidence is partly obliterated. The email was used in FWA proceedings later in 2010 so it must have been created that year as the date contended. Rogers was not aware of the certificate until it was filed in the FWA proceedings.
During the period of his hospitalisation and convalescence, Silver was largely on unpaid leave. Rogers says, and I accept, that Silver had no accrued sick leave entitlements. Rogers gratuitously paid him three days sick leave, allowed him his accrued annual leave of 4 ½ weeks and then for the balance of the time permitted Silver to be absent from work on a leave without pay basis. In effect this unpaid leave commenced in mid April and extended to the date of termination.
During the course of his illness and subsequent convalescence, Rogers contends that he kept Silver informed of his progress. Given the matters detailed below, I think it is more probable that Silver’s evidence on this point is only technically correct. He did not speak directly with Rogers but communicated with staff of TWR. Through their agency he was able to maintain that Rogers was kept informed.
Rogers denies that Silver contacted him and informed him when he was fit and ready to return to work and complained that while Silver regularly called TWR to check on his mail and clients he refused to speak directly to him. Plainly, Rogers was informed of Silver’s progress. For instance, Mr Leadbetter, an accountant employed with TWR, stated that he had no firsthand knowledge of dealings between Rogers and Silver during the course of Rogers’ absence, although he recalled Silver having been off work prior to March for some time due to having an operation which then resulted in him contracting a golden staph infection. He stated that he remembered telling Rogers that he did not want the applicant in the TWR offices if he was still affected by the golden staph infection as he believed it was contagious. The source of his knowledge is unclear. However, Pauline Tuffs, who was employed at TWR as the office administrator, stated that following Silver’s operation he would often call the office on a regular basis and talk with her about how his health was progressing and inquire about how things were going at the office, as well as to chat generally. It follows that I am satisfied that TWR and Rogers were informed of Silver’s general progress following the conversations between Rogers and Tuffs. From Tuffs, general information concerning Rogers percolated through the firm to those who needed to know or were otherwise generally interested.
It was also plain from the evidence of Tuffs that the relationship between Rogers and Silver had commenced to deteriorate at or about the time of and following Silver’s surgery. For instance, Tuffs relates an occasion where in the course of a conversation with Silver she asked him if he wanted to talk to Rogers. She said Silver said words to the effect of “why would I want to do that?” She noted that after Silver was out of hospital Rogers was keen to catch up with him but that it was difficult for them to meet. However, that does not appear to be entirely consistent with other evidence. For instance, she noted that Rogers eventually started parking his car a few blocks from the office in the hope that Silver would not realise that he was at the TWR office. She observed that Rogers did this because he would often hear Silver’s car drive past the office. She noted that Silver’s car had quite a loud and I assume distinctive sound. Arguably, there seems to have been some sort of standoff between them in the lead-up to the material events. The basis for this friction is unclear.

Events of 10 June

Rogers says that on or about 10 June 2010 Silver called TWR to talk to a member of staff who I assume was Tuffs. Tuffs transferred the call to Rogers and subsequently they had a conversation. Rogers says that during the conversation he requested Silver to attend a meeting with him to discuss his then current situation. Silver says that in fact he phoned Rogers to tell him he had a medical certificate clearing him for return to work suggesting a more direct approach to Rogers than accords with the recollection of either Tuffs or Rogers. Nothing turns on that matter.
Rogers says that during the course of the telephone conversation to arrange the meeting Silver did not advise him that he was fit to return to work. Given that Dr Angel’s report was not prepared before 11 June, I accept that is the case. Furthermore, it seems probable having regard to the impasse between he and Silver that Rogers recognised the need to bring these matters to a head.
Plainly, given the circumstances, I expect that Rogers was at that time contemplating the termination of Silver. I expect that the unpleasantness of that task was the basis for Rogers’ reluctance to earlier confront Silver. Although Rogers alleges in his defence that he had been attempting to contact Silver for some weeks before the discussion of 10 June and that there had been a refusal by Silver to speak with him, I am not satisfied that is the case. I think there was an equal sense of reluctance on Rogers’ part to deal with Silver. So much is evident from Tuff’s observations concerning Rogers’ parking his car some distance from the office where it would not be necessarily visible to passersby.
No doubt Rogers’ discomfort with the prospect of terminating Silver was influenced by Silver’s age and young wife and family. Rogers’ appreciation of Silver’s precarious position was re-enforced in his dealings with Centerlink who had contacted him concerning a claim by Silver for sickness benefits. A record from Centerlink indicates that when it contacted TWR to enquire whether Silver had a job to return to the officer was informed that “he [TWR’s spokesman] didn’t know if Ray would be able to come back due to his health & age.” At this stage the reporter noted that Silver had not been terminated and his position was being held open for him. Rogers accepts that he was the spokesman. He says that when he was initially contacted by an officer from Centerlink about the form that he had returned to them they informed him that they could not pay Silver sickness benefits. He says that when asked why Silver could not be paid sickness benefits the relevant officer noted that it was due to the way matters had been expressed. He said that she expressed words to him which would ensure Silver was eligible for sickness benefits and I infer that Rogers duly complied by providing the words the officer suggested, for as he noted in his statement “I did not want to do anything which would prevent Mr Silver from receiving benefits for which he was eligible and to which he was entitled.” He says that it was with that in mind that he made the remarks recorded in the Centerlink notation that the “employer advised he didn’t know if Ray would be able to come back due to his health & age.” Likewise, he attributes the same motive to the statement “At this stage Ray has not been terminated and his position is still being held open for him.”

Meeting of 16 June

It does not appear to be in issue that the meeting of 16 June took place at a coffee shop called “Redefined” on the Redcliffe Parade. Nor is it in issue that the meeting took about 45 minutes to an hour. I accept Rogers’ evidence that the meeting commenced with general friendly conversation with Rogers enquiring of Silver’s health and Silver responding by providing Rogers with the detail of his then current situation including his then current need for daily dressing changes at his local “North Lakes Medical Precinct.” Likewise, I accept that Rogers informed Silver of his own condition as there was some element of commonality with each having suffered coronary conditions. I accept that it is more likely than not that the general conversation then led to the matters that are material to this application.
Rogers said that he opened the subject noting “Ray, I don’t have any work for you anymore.” I think it is likely that Rogers did in fact raise the subject. Rogers had convened the meeting and as I have earlier observed it was plainly Rogers’ intention to address this subject. It follows that he would have opened the subject in the manner that he contends. In any event, there was not much difference between the recollections of either Silver or Rogers concerning the opening gambit. Silver says Rogers opened by noting “I’ve got no money. You’ve got no work. You’ve got no job, and I don’t have to pay you anything.” Rogers, whilst a little more expansive, covered exactly the same issues in what he says was his opening gambit. In my view, nothing turns on the differences between the witnesses on this subject. However, I do accept Silver’s evidence that the raising of the subject came as something of a surprise to him. He says that he was dumbfounded. Perhaps that overstates his reaction, but in any event I accept that given he had no prior basis to believe his employment was about to be terminated Rogers’ observations would have come as something of a surprise to him. Accepting that to be the position, I am in little doubt that from that point Silver listened quietly to proposals made by Rogers but probably had not sufficiently processed the information concerning termination including its implications for him and its bearing upon future matters. It follows that I find it more probable than not that as Silver said he responded to the proposal stating that he would think about it but did not expressly accept it.
While Rogers concedes that Silver did not formally accept the proposal, I do not accept that at that time Silver indicated that he was keen on the proposal and that he was going to accept it. As Rogers himself had noted, Silver had already expressed some reservations about any arrangement that involved him working from home, not that that formed part of the formal offer made on 12 July 2010. However, Silver’s observation on that matter served to inform Rogers that further consideration of another suitable arrangement might be required. The proposal may have been discussed in general terms but I am satisfied that it did not form the basis of any formal offer beyond some proposal in principle and that no acceptance of any proposal was ever communicated at that meeting.
I am however satisfied on balance that Rogers did inform Silver at the meeting on 16 June that he did intend to terminate Silver’s employment. I am also satisfied that at this meeting Silver did inform Rogers that he was fit to return to work notwithstanding that Silver did not present Rogers with a medical certificate. He informed Rogers that he was in effect fit to return to work with immediate effect. Silver had considerable motivation to return to work. Plainly, he was suffering financial difficulty; his house, for instance, was about to be sold up by the bank; he had a wife with young children; he was in receipt of social security benefits. I accept that he was anxious to return to work and for that reason had consulted his doctor to get a medical clearance. I do not accept Rogers’ evidence that the prospect of his return to work was not raised and furthermore I do not accept the need for daily changes of his dressings and any immobility problems Rogers says that Silver raised were impediments to his return to work. I am satisfied of that matter particularly in view of the medical report of Dr Angel. In my view, such a finding is fortified by Rogers’ evidence that between 16 June and 12 July Silver did indeed return to TWR’s office on a regular basis and that he was noted to have “wandered in and out of his office as he pleased,” plainly indicating that mobility was not an issue.
I accept that there was also discussion at the meeting concerning other matters, including financial assistance with Silver’s vehicle registration. However, those other matters are of no moment in the context of this application.
In his defence, Rogers denies that he summarily terminated the applicant’s employment, stating that he simply gave him notice that his employment was to be terminated because of the financial circumstances of the business as a whole and that he said to him that he did not expect his position to be available for him. Whilst it might be strictly correct that Rogers did not say to Silver that he was ‘terminated,’ the inference was plain. I am satisfied that Silver had informed Rogers that he was fit to return to work and Rogers, knowing that the time to ‘bite the bullet’ on this issue had arrived, gently sought to advise him that he was terminated by informing him that he did not have any work for him any more. The effect of that information was the same. That is, Silver’s employment had to be terminated because of the business’s financial circumstances. Furthermore, the conversation alleged by Rogers is entirely consistent with termination. Why for instance would Rogers have raised the issue of his making enquiries with Fair Work Australia regarding redundancy if termination had not been at the forefront of his mind?

Events of 16 July

As Rogers has deposed, and I accept, Silver attended at TWR’s offices between 16 June and 13 July. It is of course odd that Silver attended the office of TWR given Roger’s oral notice of 11 June. However, as I have noted, the ongoing arrangements proposed had not been settled. They contemplated Silver using TWR’s offices. It follows that Silver was attending with a new arrangement in mind, notwithstanding that it had not been defined.

Silver says that he attended the offices of TWR on 13 July when Rogers handed him two letters which are detailed below. Rogers denies that that occurred. He says that the letters were forwarded to Silver by email. It is conceivable that these documents were PDF files attached to an email of that date. I note from the applicant’s affidavit of documents that he only discloses an email forwarded to him by Rogers on 12 July 2011 and does not disclose as discrete documents the two items of correspondence from Rogers to him, each dated 12 July. On the balance of probabilities, I am satisfied that those two letters were not disclosed because they were attachments within an email which has been disclosed. It follows that I prefer Rogers’ evidence that the letters of 12 July were emailed and not delivered personally by Rogers to Silver. 12 July 2010 was a Monday. It is not inconceivable that Silver opened the emails whilst at work, explaining his belief that he was given the letters personally by Rogers.
Of greater significance however are the terms of those two letters. The first of the two letters was a lengthier document over two pages, wherein the opening paragraph stated:
“As a result of recent changed circumstances you are now conducting your own Tax agent business.
I am agreeable to assisting you in this regard but confirm that you are not an employee of the TWR Group or associated entities nor are you a sub-contractor.”
The letter then proceeded to detail a proposal for Silver to work from Rogers’ office. The proposal was something similar to the proposal first raised by Rogers at the 16 June meeting.
More significantly, the second of the two letters was much shorter and, relevantly for the purposes of this application, it stated:
“As discussed, and confirmed by you unfortunately we no longer have a position for you.
This is a result of economic circumstances and health related issues.”
Notwithstanding the oral notice provided at the 16 June meeting, this was the first written notice by Rogers to Silver addressing the issue raised at the meeting.

Termination in contravention of general protection

From Rogers’ perspective, the wording is unfortunate particularly by reference to “health related issues.” These matters are explored in further detail below, but broadly Silver contends that the use of the words reveal the real intent behind Rogers’ termination of his employment, namely Silver’s health condition. If that be the fact, then arguably Silver’s termination constituted adverse action in respect of a general protection to which he was entitled by operation of s.351 FW Act.
On Rogers’ version, the dismissal was simply because of economic circumstances. In any event, on his case the applicant’s claim would fail because he contends that no basis arose for a contravention of s.561, because on his case it is submitted that the evidence demonstrates that neither age nor physical disability were relevant concerns before or at the time of dismissal.
Relevantly, s.351 FW Act provides:
“Section 351 Discrimination
351(1) An employer must not take adverse action against a person who is an employee … of the employer because of the person's … age, physical or mental disability, ….”
Section 342 FW Act defines adverse action to mean, among other things, dismissing an employee; s.342(1) Item 1 (a) FW Act. There is no issue in this case that Silver has been the subject of adverse action. It is admitted that on 12 July 2010 Rogers gave Silver notice of termination and that he acted upon it. Silver’s employment was terminated.
Silver’s case is pleaded on the basis that he was dismissed because of age and/or his physical disability. Either basis would support the applicant’s claim if it could be demonstrated on the evidence that his dismissal was because of either or both of those matters.

Termination for reasons of age

While it is correct that the applicant is now 68 (66 at the material time), the matter of age never arose on either case except by reference to the Centerlink document raised following a conversation between a customer service advisor and Rogers. The diary of the conversation observes:
“I contacted employer Re Q3 of Q586, discussed if cus had a job to return to, employer advised he didn’t know if Ray would be able to come back due to his health & age. At this stage Ray has not been terminated and his position is still being held open for him.”
The diary notes that conversation as having occurred on 16 April 2010.
Rogers maintains that he adopted words suggested to him by the customer service advisor in order to ensure that Silver received the optimum social security benefits for which he may have been eligible. From that I infer that the benefits payable for an employed person on sickness benefits are greater than those that would have been payable to him on the old age pension despite there being no direct evidence on that point. In any event, Rogers says he knew, and I expect he ought to have, that Silver had no other income or entitlements due to him such that he would have been dependent upon Centerlink benefits. Accordingly, I have no reason to disbelieve Rogers on this point. It accords with both common sense and common decency.
I find that his remarks to the Centerlink customer service advisor did not reflect any intention on his part or form part of the reason for the subsequent dismissal of Silver. In the absence of any other evidence concerning Silver’s age as a reason, I am satisfied that age was not an operative factor in Silver’s termination.

Termination for reason of physical disability

The other ground raised for termination was because of Rogers’ physical disability.
There is no issue that the applicant’s health condition constituted a physical disability for the purposes of the term “physical disability” in s.351 FW Act. Plainly, Rogers’ letter of termination addressed to Silver provides “health related issues” as being one of the reasons. Prima facie, it appears that the termination was for a prohibited reason. In the ordinary course, if that prohibited reason formed a part of or was operative in the reason for termination that would be the end of it. The applicant would be entitled to relief and there would be no need to proceed to consider whether there was some other reason, as is required by s.361 FW Act.
Rogers’ explanation is relatively straightforward. He says that the reference to “health related issues” was not a reference to Silver’s health related issues but rather a reference to his own health related issues. He contends that the inference to be drawn was that because of his own health related issues coupled with the financial difficulties then being experienced in his business he could no longer afford to carry Silver.
I do not accept Rogers’ explanation. While I generally accept Rogers’ evidence concerning the circumstances of his business, the fact remains that the relevant conversation of 16 June also centered about the applicant’s health. While the respondent undoubtedly also related his own health issues, as they had both suffered from similar ailments, it was more likely that the health issue discussion was comparative, with Silver relating his experience and Rogers responding by addressing his own.
Curiously, for Rogers there was no suggestion in his evidence in chief that his health had impacted on his ability to employ his staff generally. However, the corollary, namely that Silver’s health would have negatively impacted upon his ability to work, was plainly ‘the elephant in the room’ subject in their conversation.
Further, it does seem odd that given his health issues Rogers was not happy to have another fee earner in his practice to cover for him during the course of his own illness. The fact remains that his practice, although small, had a staff approximating 10 employees including both administrative and professional staff. He had a practice manager. All his affairs appear to have been in hand when he (Rogers) was off sick. Plainly, the more fee earners he had, the better to defray his fixed costs of operation.
This also seems inconsistent with the proposal presented by Rogers to Silver concerning future arrangements. That arrangement was not contemplated on the basis that the practice was being wound back because of Rogers’ health condition or for any other reason. His decision was more consistent with an attempt to bring revenues in line with costs. That is, to raise productivity. It is well acknowledged that the best way to do this is to incentivise the workforce by tying income directly to output which is precisely what the arrangement sought to do.
On balance, I am satisfied that the remarks in Rogers’ letter of 12 July constituted something of a ‘Freudian slip’ revealing his true concerns. That is that business was down and Silver’s health gave rise for concern by Rogers. He was particularly concerned about the impact that Silver’s health would have upon his productivity and in turn his profitability as an employee. In my view, it was more than serendipitous that at the same time that Silver was terminated a proposal was put that would have immediately addressed Rogers’ underlying concern concerning Silver’s effectiveness upon his return to work following his illness.
In his claim, Rogers sought to make much about conversations between he and Silver addressing Silver’s productivity. Evidence was led addressing the subject of budgets being raised at team meetings and in particular at meetings towards the end of June 2009. For instance, much was made of a meeting held at the end of June 2009 where matters including tough business conditions and the need to improve performance or face redundancy were the subject of conversation between Rogers and his various employees including Silver. Indeed, John Leadbetter, another accountant employed by TWR, gave evidence that he believed that the applicant was an individual targeted by those comments. Tuffs, the office administrator, Rhys-Annabelle Richards, an accountant, and Lyndall Schulze, an accountant, also gave similar evidence.
I have no reason to disbelieve their evidence or Rogers’ evidence generally that trading conditions were difficult and that he was keen to raise issues relevant to the individual budgets of his employees, as well as highlight the real risk to them of their employment in the event that budgets were not achieved. However, if anything those comments and discussions served to highlight the need for Rogers to handle Silver’s termination a little over 12 months later more carefully. Whilst the question of productivity was plainly alive particularly in trying economic times it was a matter which had not been addressed in the period leading into Silver’s termination.
Rogers’ termination of Silver did not serve to afford him an opportunity to achieve his budget and given all the circumstances and for the reasons that I have noted earlier I am satisfied that Silver’s health was an operative reason in his termination. For instance, had Silver returned to work and continued to demonstrate poor productivity by failing to achieve set budgets then arguably Rogers could have performance managed Silver out. However, the circumstances of Silver’s termination plainly indicate that he was not afforded that opportunity. He had not returned to work since his departure for health reason in early March. While poor budget performance and declining business circumstances provided some background, a temporal association with Silver’s serious health condition cannot be ignored. It all served to reinforce my finding that Silver’s health condition was an operative reason.
I note at this point that the respondent’s written submissions contend that there was no objective evidence that Silver was subject to disability at the operative time, because as at the date of termination he was “ready, willing, and able” to return to work. That submission takes too narrow a view of the facts. It is correct that the applicant must prove the existence of objective facts before the reverse onus is enlivened, but such is a question of fact for the Court; Barclay v the Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC 14 at [34] citing Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2010] FCA 590 at [44]. For reasons I have given, I am satisfied of the existence of objective facts being established by the applicant at least with respect to his physical disability. As I have earlier noted, I rejected his case based upon allegations concerning age.[2]
[2] For completeness I note that the respondent appeared to concede the matter in his oral submissions at T117 line 37

Reverse Onus

Given my findings above, it is necessary to proceed to consider Rogers’ explanation following the reverse onus created by s.361(1) FW Act. Further, in my view, it is in any event particularly necessary to consider Rogers’ explanation because the reasons I have found extant may still not be “operative and immediate reasons”[3] when measured against what Rogers says are the real reasons.
[3] Barclay v Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC 14 at [30].
Relevantly, s.361 FW Act provides:
“[361] Reason for action to be presumed unless proved otherwise
(1) If:
(a) in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and
(b) taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed, in proceedings arising from the application, that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.”
As Baker J in Australian Licenced Aircraft Engineers Association v International AviationService Assistance Pty Ltd [2011] FCA 333 observed, the reversal of the onus does not alleviate the evidentiary evidence of establishing objective facts supporting the contraventions.[4] His Honour observed with approval the remarks of Collier J in Jones v Queensland Tertiary Admission Centre Ltd (No 2) [2010] FCA 399 at [10]:
“[331] … Collier J considered it was not sufficient for the applicant to simply allege that she had a workplace right and that she was the subject of adverse action. Rather, on the assumption that she was able to prove those allegations, the burden was then cast on the respondent to prove that the adverse action was not taken because of a workplace right.”
[4] At [329].
Here the facts contended by Silver have been objectively established and from there it is open to find that Rogers contravened s.351 FW Act when he took the adverse action of dismissing Silver. In my view, both the temporal connection between Silver’s health and the adverse action together, unless answered, would lead to a conclusion that there had been a contravention.
It follows therefore that the remaining question to be resolved is whether the adverse action was taken because of Silver’s health. By operation of s.361 FW Act, Rogers bears the onus to prove otherwise, that is that the adverse action was not taken because of Silver’s health.
The operation of s.360 and s.361 FW Act have recently been considered by the Full Court in Barclay v Board of Bendigo Regional Institute of Technical and Further Education (supra). At [30], the majority stated:
“Section 360 continues the long-standing position that, where adverse action is taken against a protected person, culpability will be established if the reasons for that conduct include a reason for conduct that is within the ambit of s.[340]. The reason must be an operative or immediate reason and need not be the sole or dominant reason … But the drawing of distinctions between proximate or immediate reasons for conduct … or between the cause of conduct and the reason for conduct … is not helpful. Those distinctions fail to give sufficient attention to whether or not the reason was operative, and they also draw distinctions between a reason and a factor in a reason.
…
[32] The onus cast by s.361 on the person taking the adverse action means that, to succeed, that person has to establish that he or she was not actuated by the attributes or industrial activity which s.346 seeks to protect. As Mason J said in [General Motors Holden Pty Ltd v Bowling (1976) 12 ALR 605] at 617, that objective will not be achieved unless the evidence establishes that the real reason for the adverse action lies outside the ambit of the provision – in this case s.346. The real reason or reasons for the taking of the adverse action must be shown to be “dissociated from the circumstances” that the aggrieved person has or had the s.346 attribute or has or had engaged in or proposes to engage in the s.346 industrial activity.”
Further, at [34], their Honours continued:
“… a failure by the employer to establish that the real reason for the taking of the adverse action was dissociated from the circumstance that the employee was promoting a lawful activity for or on behalf of an industrial association will result in a finding of contravention, irrespective of the employer’s subjective belief that the activity was unlawful …”
In the context of a dispute under s.340 FW Act, Greenwood J in Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2012] FCA 563 summarised the position as follows from [57]:
“… Section 360 of the Fair Work Act provides that a person takes action for a particular reason if the reasons for the action include that reason. It is therefore sufficient, in order to establish a contravention of ss.340 or 346 to show that the dismissal of the employee occurred for reasons that include a prohibited reason under those sections. The prohibited reason need not be the substantial or dominant reason … The prohibited reason must be an operative reason …
…
[60] As to the real reasons for taking adverse action, the Full Court of this court has held in Barclay, by majority, that the decision-maker cannot in a determinative or decisive way simply, in effect, swear the issue by asserting a belief (even a genuinely held belief) that the reasons for taking the action were particular reasons. The forensic search for the real reasons is said to involve a characterisation of the reason or reasons of the person who took the adverse action and whilst the subjective intention of the decision-maker will be “centrally relevant,” it cannot be decisive of the question. The search at trial is for the factors that actuated the conduct of the person, not a search for the factors the person thinks actuated him or her. The majority observed that, “[i]t is not open to the decision-maker to choose to ignore the objective connection between the decision he or she is making and the attribute or activity in question …””
It was submitted for the applicant that from the facts and circumstances of this case the Court would conclude that Silver’s health was among the operative reasons for the adverse action, and, accordingly, constituted the basis for the adverse action because that operative matter was included in the reason. For reasons I have earlier provided, I am satisfied that it was. Furthermore, I am satisfied that the reason given by Rogers is not so compelling that it served to extinguish or diminish the operative quality of Silver’s health as an operative part of the reason for his dismissal. It follows that on this basis alone Silver’s termination was in contravention of s.351(1) FW Act. For reasons I have provided earlier, I do not find that age was a reason material to the termination decision.

Termination Pay

Silver complains that following termination he was not paid his entitlements pursuant to s.117 FW Act. Irrespective of the question concerning entitlements, it is evident from the facts that Silver’s last pay was provided to him on 16 April 2010 and beyond that time no further payments were made to him. As at the date of his last payment his gross weekly salary was $1,413.46, which net of $330.01 tax rendered a weekly net pay of $1,083.45. It follows that irrespective of the dispute concerning when termination actually occurred the fact remains that Silver neither returned to work and was paid to work out his termination entitlement, nor was he paid in lieu.

So far as is relevant, s.117 FW Act provides:
“Section 117 Requirement for notice of termination or payment in lieu
Notice specifying day of termination
(1) An employer must not terminate an employee's employment unless the employer has given the employee written notice of the day of the termination (which cannot be before the day the notice is given).
Amount of notice or payment in lieu of notice
(2) The employer must not terminate the employee’s employment unless:
(a) the time between giving the notice and the day of the termination is at least the period (the minimum period of notice ) worked out under subsection (3); or
(b) the employer has paid to the employee … payment in lieu of notice of at least the amount the employer would have been liable to pay to the employee … at the full rate of pay for the hours the employee would have worked had the employment continued until the end of the minimum period of notice.”
Section 117(3) FW Act proceeds to provide minimum periods of notice and the manner in which those periods are to be calculated. In this case Silver contends that he was employed for more than five years and accordingly ought be allowed four weeks in accordance with the table provided in s.117(3)(a), together with an additional week pursuant to s.117(b) because he was over 45 years of age and had completed at least two years of continuous service as at the end of the day on which the notice was given.
Rogers contends that four weeks is the appropriate notice period on the basis that Silver was employed for more than three years but not more than five years.
For Rogers, it was contended that notice was given at the meeting of 16 June. It is accepted that Silver’s employment commenced no later than 27 June 2005. That was the date of Silver’s application for PAYG deductions as an employee. There was a dispute between the parties concerning whether or not Silver had been previously employed as an employee (notionally on a causal basis or part time basis) or whether he had been employed as an independent contractor. However, for reasons which follow it is unnecessary for me to resolve that dispute.
Section 117 expressly provides for the basis upon which the notice or payment in lieu of notice is to be calculated. First, an employer must not terminate unless it gives the employee written notice; s.117(1) FW Act. Further, the employer must not terminate unless the time between the giving of the notice and the date of termination is at least the period provided under ss(3). The period is a reference to the “employee’s period of continuous service with the employer at the end of the day the notice is given.” Plainly, the time for calculating employment for the purposes of informing the notice period is the date that the notice pursuant to s.117(1) FW Act is delivered. There is no contest about that matter in this instance. That notice was delivered on 12 July 2010. It is immaterial that from the meeting of 16 June 2010 that Silver was aware that his employment was to be terminated. In my view, the terms of s.117 FW Act are clear and although it may be serendipitous that the passing of time between the provision of informal notice and formal provision of notice served to extend the reference period by 12 months, the fact remains that as at the date of the delivery of written notice Silver was entitled to five weeks notice or pay in lieu.
Given his gross wages of $1,413.00 per week or $1,083.45 net per week, his wage entitlement net of tax for five weeks was $5,417.25. He is entitled to judgment for that sum.

Contravention

For the reasons provided I am satisfied that Rogers contravened s.351 FW Act. Contravention of s.351 is a civil remedy provision pursuant to the provisions of s.539(2) Item 11. That provision provides a maximum penalty of 60 penalty units. As a national system employee he was also entitled to be paid termination pay in accordance with s.117 FW Act and the failure to pay that sum is a contravention of s.44(1) FW Act giving rise to a civil remedy and subject to a civil penalty of 60 penalty units: s.539(2) Part 2-1 Item 1, FW Act.
Section 545(1) provides that the Court may make an order that it considers appropriate if the Court is satisfied that a person has contravened a civil remedy provision which includes an order for compensation for loss the person has suffered because of the contravention. The Court may also order the contravenor to pay a pecuniary penalty that it considers appropriate if it is satisfied that the person has contravened a civil remedy provision.
In his evidence, Silver complained that by reason of his termination he felt considerable stress and embarrassment. He claimed to have suffered depression. He claims that despite having made reasonable efforts to secure alternative employment he had no success. In particular, he had no capacity to find employment in Redcliffe which is reasonably local to where he lives. Broadly, he claims for 25 weeks loss of pay together with compensation for injured feelings.
At the outset it is necessary to observe that, irrespective of the contravention giving rise to termination, the fact remains that Silver was well past the statutory retirement age and had been in poor health. Plainly, his circumstances would not have rendered him a desirable employee in a competitive marketplace. The risks associated with his age and health would have told against him in any competitive contest for employment irrespective of whether a prospective employer would be so bold as to state that matter or otherwise. There were plainly grounds upon which Rogers could properly and appropriately have terminated Silver’s employment. Unfortunately, no job can be seen as a job for life. It follows that I do not accept that the hurt and distress which Silver complains of can be attributable to the circumstances surrounding his termination. He was plainly distressed about his termination per se but that distress in my view would have been no different to the distress that he would have suffered in any event had his termination been handled appropriately.
I am however mindful that the inappropriate basis for termination would have been a source for aggravation and on that basis Silver is entitled to some compensation, although in the circumstances I consider the appropriate quantum of compensation to be relatively minor. As I have earlier noted, Silver was entitled to be paid the sum which ought to have been paid in lieu of notice as that was a statutory entitlement pursuant to s.117 FW Act.
Alternatively, the position of an employee’s damages for unlawful dismissal are assessed in accordance with common law principles. In Bostik (Australia) Pty Ltd v Gorgevski (No 1) (1992) 36 FCR 20 at 32, Sheppard and Heerey JJ, with whom Ryan J agreed on this point, stated:
“…The contract in question is a contract of employment which is terminable by either party on giving to the other the applicable period of notice provided for in the award. Where an employee is wrongfully dismissed, he is entitled, subject to mitigation, to damages equivalent to the wages he would have earned under the contract from the date of the dismissal to the end of the contract. The date when the contract would have come to an end, however, must be ascertained on the assumption that the employer would have exercised any power he may have had to bring the contract to an end in the way most beneficial to himself; that is to say, that he would have determined the contract at the earliest date at which he could properly do so.”
In this instance, Rogers unlawfully purported to terminate the contract on 16 June. He ought to have commenced a performance management process from that date or alternatively, at best for Rogers, the termination process. Given his complaints about productivity, the performance management process appears to be what was reasonable in the circumstances. From the facts I do not think that he simply wanted to dismiss Silver. He was as keen to keep Silver on a contract arrangement and enjoy the economic benefit of another revenue source as Silver was to keep working.
It follows that I think that damages should be decided on the basis of Rogers’ failure to afford Silver three months employment which would ordinarily see out a performance management termination. The value of lost wages over three months was $13,001.49 net of tax.
I allow $2,000.00 for hurt and distress occasioned by the inappropriate notice afforded by Rogers. As earlier noted, I do not think any distress and hardship was occasioned by the non-payment of termination pay. In respect of termination monies, compensation ought be limited to the sum of $5,417.25 he was not paid. Interest on those monies ought be adequate compensation. He should also be allowed $13,000 damages for lost wages.
In addition to compensation it is also appropriate that a penalty be imposed for the contraventions.
The general considerations to be applied in considering the position of a pecuniary penalty are summarised in Mason v Harrington Corporation Pty Ltd t/as Pangaea Restaurant and Bar [2007] FMCA 7. That authority has been cited with approval in the Federal Court in Kelly v Fitzpatrick [2007] FCA 1080 and in the Full Court in Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith [2008] FCAFC 8. They identify a number of factors that ought be taken into account in deciding whether particular conduct calls for a penalty and the quantum of such a penalty. While those cases identify a convenient checklist of matters, they do not prescribe or restrict the matters which may be taken into account in the exercise of the Court’s discretion. Generally, it should be noted, as was observed by Burchett J in Trade Practices Commission v TNT Australia Pty Ltd (1995) ATPR 41-375, that:
“It cannot be denied that the fixing of the quantum of a penalty is not an exact science. It is not done by the application of a formula and, within a certain range, Courts have always recognised that one precise figure cannot be incontestably said to be preferable to another.”
Generally, I have taken into account the circumstances surrounding the contravention and the nature and extent of damage suffered by Silver. I also take note of the fact that there are no previous complaints against Rogers and that his business is a relatively small operation, although that matter of itself is not decisive. I also take into consideration the deliberateness of the breach, noting that the breach has arisen by reason of Rogers’ indelicate approach to a matter which was probably inevitable. That is to say by reason of Silver’s age and health his productivity in the workplace had diminished significantly such that he was becoming a burden being carried by other employees and so the difficult conversation concerning his termination (perhaps retirement) was one that was necessary to be had. It was, however, poorly handled. I also take into account that in this instance no contrition has been expressed on the part of Rogers. He has contested the application and to date not even made payment or even part of the payment in lieu which on his reckoning ought be allowed.
Overall, having regard to all of the circumstances both individually and cumulatively I come to the view that an appropriate penalty for the breach of general protection contravention is $1,500.00 and that a $500.00 penalty be imposed for the contravention associated with the failure to make payment upon termination.

Interest

The applicant is entitled to interest on that part of the order which relates to compensation. I have estimated compensation at $20,417.25 made up of $13,000.00 net wages due, $5,417.25 due on termination and $2,000.00 compensation for hurt and distress. Those monies have been payable since 12 July 2010. Interest ought be allowed on those sums since that date at the rate applicable. I calculate interest at $3,180.38.[5] A further $2,500.00 is to be paid by way of penalty which sum I direct be paid to Silver.
[5] 756 days/364 days x .075% x 20417.25 = $3,180.38. Interest is calculated at 4% plus the RBA cash rate applicable for the period immediately prior to 1 July 2012. (The rate recommended by the Rate Harmonisation Committee by the Council of Chief Justices for Australia and New Zealand).

Conclusion

In conclusion, I am satisfied that Rogers breached a general protection with respect to Silver, specifically pursuant to his dismissal on the basis of having a physical disability. In reaching that conclusion, I am satisfied that Silver’s heart condition and the subsequent complications were an operative reason in Rogers’ decision to terminate. I do not accept that age was an operative reason in the termination decision. I am also satisfied that there was a breach of the national employment standard, insofar as it applied to Silver, concerning non-payment of termination entitlements.
In respect of the non-payment of termination entitlements, I assess Silver’s entitlement at $5,417.25. I assess compensation for hurt and distress for the contravention associated with the circumstances of dismissal at $2,000.00 together with $13,000.00 loss of wages for the breach of opportunity to be performance managed out. I allow interest on those sums which I assess at $1,155.38. In addition, I impose a penalty of $2,000.00 in respect of the contravention of s.351 and a penalty of $500.00 in respect of the contravention of s.44. I direct that the penalties be paid to the applicant.

Orders

I order and declare that the respondent contravened s.351 Fair Work Act 2009 (Cth).
I order that the respondent pay a penalty of $2,000.00 in respect of such contravention.
In respect of the s.351 Fair Work Act 2009 (Cth) contravention, I order that the respondent pay the applicant the sum of $15,000.00 by way of compensation pursuant to s.545(2) Fair Work Act 2009 (Cth), made up as $2,000.00 for distress and $13,000.00 in lost opportunity damages.
I order and declare that the respondent contravened s.44(1) Fair Work Act 2009 (Cth).
I order that the respondent pay a penalty of $500.00 in respect of such contravention.
In respect of the s.44 Fair Work Act 2009 (Cth) contravention, I order that the respondent pay the applicant the sum of $5,417.25 by way of compensation for non-payment of s.117 Fair Work Act 2009 (Cth) entitlements pursuant to s.545(2) Fair Work Act 2009 (Cth).
I order that the respondent pay the applicant interest upon the sums the subject of orders 3 and 6 assessed at $3,180.38.
I order that all monies the subject of these orders be paid within twenty-eight (28) days of these orders.

I certify that the preceding eighty-four (84) paragraphs are a true copy of the reasons for judgment of Burnett FM

Date: 8 August 2012