Susana Lawrie v & R C Milisits T/A Vili's Cakes
[2013] FWC 5277
•1 AUGUST 2013
[2013] FWC 5277 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Susana Lawrie
v
V & R C Milisits T/A Vili’s Cakes
(U2013/8880)
SENIOR DEPUTY PRESIDENT O’CALLAGHAN | ADELAIDE, 1 AUGUST 2013 |
Application for unfair dismissal remedy - dismissal - termination at the initiative of the employer- effect of a warning.
[1] On 26 April 2013 Ms Lawrie lodged an unfair dismissal application pursuant to s.394 of the Fair Work Act 2009 (the FW Act) with respect to the alleged termination of her employment with V & RC Milisits T/A Vili’s Cakes (Vili’s). The application was referred to me for determination when it could not be resolved through the conciliation process.
[2] The application was the subject of a hearing on 30 July 2013. At this hearing, Ms Lawrie was represented by Mr Edward Lawrie as agent and Vili’s by Mr Luke, of counsel. Mr Luke’s appearance involved a grant of permission pursuant to s.596(2)(a). The provisions of s.596 were explained to Mr Lawrie at a directions conference on 24 June 2013. Mr Lawrie indicated that permission was not opposed. Further, at the commencement of the proceedings on 30 July 2013 I again explained the provisions of s.596 and confirmed that there was no opposition to a grant of permission. Notwithstanding the absence of opposition, I was satisfied that, given the circumstances of the matter, Mr Luke’s involvement would enable the matter to be dealt with more efficiently, thereby warranting a grant of permission pursuant to s.596(2)(c).
[3] The background to the application is straightforward. Vili’s is a food manufacturing operation which also operates a cafe. Ms Lawrie was employed on a regular casual basis in the cafe for some six years. She was paid above the relevant modern award rates and worked as a shift supervisor.
[4] An issue arose around the serving of alcohol in that cafe on Good Friday, 29 March 2013. On 18 April 2013 Ms Lawrie was issued with a written warning relative to her alleged actions around this issue. After discussing this warning with the proprietor of the business, Mr Milisitis, Ms Lawrie left work on that day and did not return to work. She forwarded a formal resignation letter on 23 April 2013.
[5] Section 396 requires that I give initial consideration to specified initial matters before considering the merits of the application. The only issue of a preliminary or jurisdictional nature in this matter is simply whether the termination of Ms Lawrie’s employment was at the initiative of the employer. Vili’s has objected to the application proceeding on this basis.
[6] A dismissal is an essential requirement for an unfair dismissal application. Section 386 states:
“386 Meaning of dismissed
(1) A person has been dismissed if:
(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or
(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.
(2) However, a person has not been dismissed if:
(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season; or
(b) the person was an employee:
(i) to whom a training arrangement applied; and
(ii) whose employment was for a specified period of time or was, for any reason, limited to the duration of the training arrangement;
and the employment has terminated at the end of the training arrangement; or
(c) the person was demoted in employment but:
(i) the demotion does not involve a significant reduction in his or her remuneration or duties; and
(ii) he or she remains employed with the employer that effected the demotion.
(3) Subsection (2) does not apply to a person employed under a contract of a kind referred to in paragraph (2)(a) if a substantial purpose of the employment of the person under a contract of that kind is, or was at the time of the person’s employment, to avoid the employer’s obligations under this Part.”
[7] I have considered the circumstances of this case, in the context of s.386(1).
[8] Ms Lawrie asserts that she had “no option but to leave her employment given the facts and circumstances surrounding the written accusing her of disobeying orders, ....” (sic). 1 Further, that she was “not afforded the opportunity to defend herself, or to discuss the written warning ....”2
[9] Ms Lawrie’s evidence went to the detail of the incident involving the serving, or not serving of alcohol on Good Friday. Her evidence was that, after various discussions about the issue, she had been told that alcohol would be served and had not subsequently issued instructions contrary to that effect. On Good Friday Ms Lawrie was contacted at her home by her supervisor and asked if she had directed staff not to sell alcohol. Ms Lawrie confirmed that she had not done this. Ms Lawrie’s evidence went to her subsequent discussions with her supervisor about the incident and what instructions had, or had not been issued.
[10] Ms Lawrie’s evidence was that she was informally advised that she was to receive a warning about the matter, her discussions with the Vili’s Employee Relations Manager, Mr Telford, when she protested that she had not disobeyed orders, and to the provision, to her, of the warning on 18 April 2013. Ms Lawrie advised that she had endeavoured to discuss the matter with Mr Milisitis in the cafe but that he was not prepared to change or revoke the warning. Ms Lawrie asked Mr Milisitis to meet with her outside the cafe but he refused and said words to the effect that it was not the end of the world- that she should not worry about it and she was not the only person to get a warning.
[11] Ms Lawrie also unsuccessfully endeavoured to engage in discussions with the cafe supervisor, Ms Fountoglou about the warning. Ms Lawrie advised that she was upset and anxious about the warning and the fact that Vili’s management and Mr Milisitis were not prepared to further discuss it with her. She left work on 18 April 2013 and, when no one had contacted her, she wrote a letter of resignation which her partner, Mr Nichol delivered to Vili’s on 23 April 2013. Ms Lawrie advised that she reached the conclusion that her employment had no future on 18 April 2013.
[12] Notwithstanding that Ms Lawrie agreed that she enjoyed a good relationship with Mr Milisits until he refused to change his view about the warning on 18 April 2013, she expressed her frustration about what she described as the “culture” of the workplace and criticisms made of her some 18 months earlier.
[13] At the time of the cessation of Ms Lawrie’s employment, Mr Nichol was the Vili’s Operations Manager. His evidence was that his employment had subsequently been terminated. Mr Nicholls’ evidence also went to how he became aware of the matter, his request to Mr Milisitis to meet with Ms Lawrie and his involvement in arranging for the brief discussion Ms Lawrie had with her supervisor on 18 April 2013.
[14] The Vili’s position is that the warning issued to Ms Lawrie by Mr Telford on 18 April 2013 was appropriate and that it contained an invitation to her to discuss the matter further with Mr Telford. Ms Lawrie did not do this and did not return to work after receiving the warning.
[15] Vili’s asserts that there was no termination of employment at the initiative of the employer and that the issuing and confirmation of that written warning could not represent a course of conduct which either intended, or had the probable result of bringing the employment relationship to an end. 3
[16] The evidence of Mr Telford, the Vili’s Employee Relations Manager was that Mr Milisitis had asked him to give written warnings to Ms Lawrie and another supervisor, Ms Sellin, relative to the Good Friday alcohol incident. He subsequently had a discussion with Ms Lawrie to whom the warning had been foreshadowed and then further discussed the matter with Mr Milisitis. Mr Telford was then directed to issue the warnings.
[17] After issuing those warnings, Mr Telford had a discussion with Ms Sellin who persuaded him that the warning was not validly founded in her case. He then revoked that warning.
[18] Mr Telford did not have any subsequent discussions with Ms Lawrie after she was given the warning. He received her letter of resignation on 23 April 2013.
[19] Ms Fountoglou is the Cafe Manager. Her evidence went to the various discussions, before, on, and after Good Friday with respect to the serving of alcohol. Ms Fountoglou observed Ms Lawrie discussing what she understood was the warning letter with Mr Milisitis on April 18, 2013. Ms Lawrie then asked Ms Fountoglou if she could meet with her. Ms Fountoglou met briefly with Ms Lawrie and another supervisor. She refused to discuss the warning and advised Ms Lawrie that she should return to work. 4 Ms Fountoglou retained Ms Lawrie on her regular roster until she was advised of her resignation
[20] Ms Sellin is a Vili’s Night Shift supervisor in the cafe. Her evidence went to her recollection of the discussions about the Good Friday alcohol serving arrangements. Ms Sellin’s evidence was that after she received a written warning on or about 17 April 2013 about the incident she met with Mr Telford on 22 April 2013 and explained her actions. She understood that Mr Telford advised her that he would remove the written warning from her file.
Findings -Termination at the initiative of the employer
[21] The evidence before me does not establish whether the warning given to Ms Lawrie on 18 April 2013 was properly founded. Indeed, the Good Friday incident appears to me to be most likely a simple case of misunderstanding. Notwithstanding this, the warning needs to be considered in its proper context. The warning was given to Ms Lawrie some three weeks after the incident. Not only was there no urgency attached to it but Ms Lawrie agreed that Mr Milisits indicated that it was not a major issue.
[22] The evidence indicates that Ms Lawrie was a well-respected employee. 5 The evidence of Ms Fountoglou was that she expected Ms Lawrie to return to work on 18 April 2013 after she had briefly discussed the warning with her.6
[23] The warning letter 7 itself states:
“Susana, Vili has instructed that I issue you with this written warning as he believes that on the 29th March 2013 you disobeyed his specific instruction that alcohol shall continue to be served throughout Good Friday in line with the terms of his Liquor Licence.
Vili contends that to trade was within the terms of his current licence and that it is his decision whether or not to comply with any lawful instruction issued by Vili without any dissent, failure to do so may ultimately result in the termination of your services.
If you consider that the issuing of this warning is harsh, unjust or unfair, or that there are other mitigating circumstances then I am only too happy to discuss the matter further with you.”
[24] Ms Lawrie did not take her concerns back to Mr Telford as the warning letter invited her to do. I have concluded, on the evidence before me, that Mr Milisitis actively controls the Vili’s business. While Ms Lawrie may have been correct in concluding that any attempt to get Mr Telford to change or revoke the warning would be futile, the fact that she did not even attempt to take up Mr Telford’s offer of discussions meant that Mr Telford was simply unable to review the issue.
[25] While Ms Lawrie’s evidence was that Mr Milisitis was not prepared to change his view that the warning was appropriate, there is no evidence that goes toward establishing that she was either explicitly or implicitly advised that the warning heralded the termination of her employment.
[26] I have no doubt that Ms Lawrie was upset by both the receipt of the warning letter and her assessment that this warning would not be revoked. She correctly assessed that Mr Milisits initiated the warning and approached him on that basis. Even disregarding her failure to discuss the matter further with Mr Telford, Ms Lawrie had other avenues open to her to dispute the warning. The Award under which Ms Lawrie worked 8 together with the FW Act provided an additional opportunity to Ms Lawrie to seek to resolve any outstanding disputes in this respect. No such step was taken. Instead, Ms Lawrie’s evidence was that she concluded on 18 April 2013 that she could no longer work at Vili’s. Her resignation letter,9 prepared on 22 April 2013 concluded on the basis that:
“Being that Vili, who refers to himself as “THE LORD & MASTER” has stated there will be no discussion on the matter, I feel I can no longer work in an environment, whereas I can be accused and not have a right to a discussion to at least give my version of events to either the Cafe Manager or the Owner himself. To discuss it with you now Geoff, would be pointless and put you in a position where you would be disobeying a lawful instruction from Vili (as there is not discussion) which could be deemed as dissent on your part.
Therefore effective immediately, I feel I am forced to leave Vilis and certainly believe the warning to be harsh, unjust and factually incorrect in its substance.” (sic)
[27] The concept of “termination at the initiative of the employer” has been integral to the determination of whether any employee has been dismissed in successive versions of workplace relations legislation. In terms of the FW Act, the Explanatory Memorandum states:
- where the employee is effectively instructed to resign by the employer in the face of a threatened or impending dismissal; or
- where the employee quits their job in response to conduct by the employer which gives them no reasonable choice but to resign.”
“1528. This clause sets out the circumstances in which a person is taken to be dismissed. A person is dismissed if the person‘s employment with his or her employer was terminated on the employer‘s initiative. This is intended to capture case law relating to the meaning of ‘termination at the initiative of the employer’ (see, e.g., Mohazab v Dick Smith Electronics Pty Ltd (1995) 62 IR 200).
1529. Paragraph 386(1)(b) provides that a person has been dismissed if they resigned from their employment but were forced to do so because of conduct, or a course of conduct, engaged in by their employer. Conduct includes both an act and a failure to act (see the definition in clause 12).
1530. Paragraph 386(1)(b) is intended to reflect the common law concept of constructive dismissal, and allow for a finding that an employee was dismissed in the following situations:
[28] In O’Meara v Stanley Works Pty Ltd 10 a Full Bench considered the decisions relevant to the concept of termination at the initiative of the employer in the following terms:
“[19] The circumstances in which a resignation, while apparently a termination of employment by the employee, nevertheless constitutes a termination at the initiative of the employer, have been considered in a number of cases. A prominent authority is the decision of a Full Court of the Federal Court of Australia in Mohazab v Dick Smith Electronics Pty Ltd (Mohazab). In that case, the employer made a threat that unless the employee resigned the employer would ask the police to charge the employee with an offence. The analysis of the concept of termination at the initiative of the employer by the Court in that case has not always been quoted in full. It is desirable that we do so in this case. After referring to dictionary definitions of the term “initiative” and the convention giving rise to the statutory provisions, the Full Court said:
“These definitions reflect the ordinary meaning of the word ‘initiative’. Viewed as a whole, the Convention is plainly intended to protect workers from termination by the employer unless there is a valid reason for termination. It addresses the termination of the employment relationship by the employer. It accords with the purpose of the Convention to treat the expression ‘termination at the initiative of the employer’ as a reference to a termination that is brought about by an employer and which is not agreed to by the employee. Consistent with the ordinary meaning of the expression in the Convention, a termination of employment at the initiative of the employer may be treated as a termination in which the action of the employer is the principal contributing factor which leads to the termination of the employment relationship. We proceed on the basis that the termination of the employment relationship is what is comprehended by the expression ‘termination of employment’: Siagian v Sanel (1994) 1 IRCR 1 at 19; 54 IR 185 at 201. In many, if not most, situations the act of the employer that terminates the employment relationship is not only the act that puts in train the process leading to its termination but is, in substance, the entire process. An example would be a situation where the employer decided to dismiss an employee and did so orally or in writing with immediate effect. Other situations may be more complex as exemplified by the circumstances considered by Moore J in Grout v Gunnedah Shire Council (1994) 1 IRCR 143; 57 IR 243 where an employee had given written notice purporting to terminate the employment relationship. The notice was not reasonable but was accepted by the employer which later refused to allow the employee to withdraw the notice. A question arose as to whether that was a termination of the employment at the initiative of the employer and his Honour held it was. His Honour said at 160-161; 259:
‘I have already said that Div 3 concerns termination at the initiative of the employer. The respondent submits that “initiate” means “to begin, commence, enter upon; to introduce, set going, or initiate”: see Shorter Oxford English Dictionary. In this matter, it is submitted, it was the applicant and not the respondent that initiated the termination by writing the letter of 18 May. This, in my opinion, gives the expression “termination” in the Act, read in conjunction with Art 3 of the Convention which speaks of “termination … at the initiative of the employer”, a narrow meaning that was not intended. A principal purpose, if not the sole purpose, of Div 3 is to provide an employee with a right to seek a remedy in circumstances where the employee did not voluntarily leave the employment. An employee may do some act which is the first in a chain of events that leads to termination. An example would be an employee who engaged in misconduct at work which ultimately led to the employer dismissing the employee. However, that situation and the present are not situations where the termination was at the initiative of the employee. In both instances the step or steps that effectively terminated the employment or purported to do so were taken by the employer.’
In these proceedings it is unnecessary and undesirable to endeavour to formulate an exhaustive description of what is termination at the initiative of the employer but plainly an important feature is that the act of the employer results directly or consequentially in the termination of the employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship. This issue was addressed by Wilcox CJ in APESMA v David Graphics Pty Ltd (unreported, Industrial Relations Court of Australia, 12 July 1995, Wilcox CJ). His Honour, at p 3, referred to the situation of an employee who resigned because ‘he felt he had no other option’. His Honour described those circumstances as:
‘… a termination of employment at the instance [of] the employer rather than of the employee.’
And at p 5:
‘I agree with the proposition that termination may involve more than one action. But I think it is necessary to ask oneself what was the critical action, or what were the critical actions, that constituted a termination of the employment.’”
[20] Moore J, one of the members of the Full Court in Mohazab, addressed the question further in Rheinberger v Huxley Marketing Pty Limited 13 (Rheinberger). His Honour said, after referring to extracts from Mohazab:
“However it is plain from these passages that it is not sufficient to demonstrate that the employee did not voluntarily leave his or her employment to establish that there had been a termination of the employment at the initiative of the employer. Such a termination must result from some action on the part of the employer intended to bring the employment to an end and perhaps action which would, on any reasonable view, probably have that effect. I leave open the question of whether a termination of employment at the initiative of the employer requires the employer to intend by its action that the employment will conclude. I am prepared to assume, for present purposes, that there can be a termination at the initiative of the employer if the cessation of the employment relationship is the probable result of the employer's conduct.”
[21] In this Commission the concepts have been addressed on numerous occasions and by a number of Full Benches. In Pawel v Advanced Precast Pty Ltd (Pawel) a Full Bench said:
“[13] It is plain that the Full Court in Mohazab considered that an important feature in the question of whether termination is at the initiative of the employer is whether the act of an employer results directly or consequentially in the termination of the employment and that the employment relationship is not voluntarily left by the employee. However, it is to be noted that the Full Court described it as an important feature. It plainly cannot be the only feature. An example will serve to illustrate this point. Suppose an employee wants a pay rise and makes such a request of his or her employer. If the employer declines and the employee, feeling dissatisfied resigns, can the resignation be said to be a termination at the initiative of the employer? We do not think it can and yet it can be said that the act of the employer i.e. refusing the pay rise, has at least consequentially resulted in the termination of the employment. This situation may be contrasted with the position where an employee is told to resign or he or she will be terminated. We think that all of the circumstances and not only the act of the employer must be examined. These in our view, will include the circumstances giving rise to the termination, the seriousness of the issues involved and the respective conduct of the employer and the employee. In the instant case the uncontested factual findings are that the applicant had for almost the whole of his employment performed welding duties; that there was no objective threat to his health and safety involved in the requirement that he undertake welding duties so long as it was not on a continuous basis and that the welding he was required to do was not continuous.”
[22] In the Full Bench decision of ABB Engineering Construction Pty Ltd v Doumit (ABB Engineering) it was said:
“Often it will only be a narrow line that distinguishes conduct that leaves an employee no real choice but to resign employment, from conduct that cannot be held to cause a resultant resignation to be a termination at the initiative of the employer. But narrow though it be, it is important that that line be closely drawn and rigorously observed. Otherwise, the remedy against unfair termination of employment at the initiative of the employer may be too readily invoked in circumstances where it is the discretion of a resigning employee, rather than that of the employer, that gives rise to the termination. The remedies provided in the Act are directed to the provision of remedies against unlawful termination of employment. Where it is the immediate action of the employee that causes the employment relationship to cease, it is necessary to ensure that the employer’s conduct, said to have been the principal contributing factor in the resultant termination of employment, is weighed objectively. The employer’s conduct may be shown to be a sufficiently operative factor in the resignation for it to be tantamount to a reason for dismissal. In such circumstances, a resignation may fairly readily be conceived to be a termination at the initiative of the employer. The validity of any associated reason for the termination by resignation is tested. Where the conduct of the employer is ambiguous, and the bearing it has on the decision to resign is based largely on the perceptions and subjective response of the employee made unilaterally, considerable caution should be exercised in treating the resignation as other than voluntary.”
[23] In our view the full statement of reasons in Mohazab which we have set out together with the further explanation by Moore J in Rheinberger and the decisions of Full Benches of this Commission in Pawel and ABB Engineering require that there to be some action on the part of the employer which is either intended to bring the employment to an end or has the probable result of bringing the employment relationship to an end. It is not simply a question of whether “the act of the employer [resulted] directly or consequentially in the termination of the employment.” Decisions which adopt the shorter formulation of the reasons for decision should be treated with some caution as they may not give full weight to the decision in Mohazab. In determining whether a termination was at the initiative of the employer an objective analysis of the employer’s conduct is required to determine whether it was of such a nature that resignation was the probable result or that the appellant had no effective or real choice but to resign.”
(references removed)
[29] I have adopted this approach. I have also applied the approach in Searle v Moly Mines Ltd. 11 In the following terms:
“[38] .......Where questions of jurisdiction are involved it is the facts which are relevant, not the parties’ subjective beliefs or the reasonableness of their conduct.”
[30] An objective consideration of the facts of this matter, as distinct from Ms Lawrie’s subjective or emotive response, must lead to the conclusion that Ms Lawrie was given a warning that was neither intended, nor had the probable consequence of bringing the employment to an end. It was a warning which Ms Lawrie could have further disputed but did not choose to do so. Alternatively, Ms Lawrie could simply have accepted the warning and returned to work. Ms Lawrie chose to take the warning as the catalyst for her resignation. This does not mean that she was terminated at the employer’s initiative or that the issuing of the warning was a course of conduct intended, or having the probable effect of giving Ms Lawrie no choice other than to resign. Indeed, the primary function of a warning is to put an employee on notice about behaviour which, if not addressed, could lead to termination of employment. In this respect, warnings are generally directed at avoiding employment termination situations.
[31] On this basis, I have concluded that the termination of Ms Lawrie’s employment was not at the initiative of the employer and that she was not dismissed.
[32] Section 385 states:
“385 What is an unfair dismissal
A person has been unfairly dismissed if the FWC is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.”
[33] As I have concluded that Ms Lawrie was not dismissed, her unfair dismissal application must be dismissed. An Order [PR539673] to this effect will be issued.
SENIOR DEPUTY PRESIDENT
Appearances:
E Lawrie on behalf of the applicant.
K Luke counsel for the respondent.
Hearing details:
2013.
Adelaide:
July 30.
1 Exhibit L1, para 3
2 Ibid, para 4
3 Exhibit V1, paras 35 and 36
4 Exhibit V4, para 13
5 Exhibit V2, para 17
6 Exhibit V4, para 13
7 Exhibit V2, annexure GT1
8 The Restaurant Industry Award 2010
9 Exhibit V2, annexure GT2
10 PR973462
11 2008 AIRCFB 1088
Printed by authority of the Commonwealth Government Printer
<Price code C, PR539672>
0
3
0