Tapping v Empress Diamonds Pty Ltd ATF Empress Discretionary Trust
[2021] FCCA 1335
•21 June 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
Tapping v Empress Diamonds Pty Ltd ATF Empress Discretionary Trust [2021] FCCA 1335
File number(s): MLG 2577 of 2019 Judgment of: JUDGE BLAKE Date of judgment: 21 June 2021 Catchwords: INDUSTRIAL LAW – Fair Work Act 2009 – breach of general protections – applicant’s sudden diagnosis of breast cancer in 2019 – applicant seeking to exercise workplace rights – whether applicant’s dismissal was unlawful because she proposed to take leave – dismissal unlawful
Alleged failure of respondents to pay accrued annual leave and to give notice of termination – no annual leave owed – failure to provide notice of termination or payment in lieu found
Alleged failure to provide copy of an award and NES – whether the provision of a computer or internet connection sufficient to discharge obligation to provide copy of award – mere provision of computer and internet connection not sufficient
Accessorial liability – second respondent found to be an accessory because he had power to dismiss employee and was directly involved in the dismissal – section respondent not an accessory in respect of other contraventions
Legislation: Fair Work Act 2009 (Cth) ss 44(1), 45(1), 90(2), 117(2), 340(1), 340(1)(a)(ii). 340(1)(a)(iii), 351(1), 352, 536(1), 361, 550(2),
Federal Court Rules 2011 (Cth) rr 16.02(1)(d), 16.02(2)(d)
Federal Circuit Court Rules 2001 (Cth) rr 1.05(2)
General Retail Industry Award 2010 (Cth) cl 5, 16.1, 22.2, 23.4, 29.9, 32.3
Cases cited: Banque Commerciale S.A v Akhil Holdings Ltd (1990) 169 CLR 279
Batten v CTMS [1999] FCA 1576
Briginshaw v Briginshaw (1938) 60 CLR 336
EZY Accounting 123 Pty Ltd v Fair Work Ombudsman [2018] FCAFC 134
King v R (1986) 161 CLR 423
Takemoto v Moody’s Investors Service Pty Ltd [2010] FCA 407
Watson v Foxman (1995) 49 NSWLR 315
Young Investments Group Pty Ltd v Mann (2012) 293 ALR 537
Number of paragraphs: 147 Date of hearing: 24, 25 and 26 February 2021 Place: Melbourne
Counsel for the Applicant: Mr Lake of Counsel Solicitor for the Applicant: McDonald Murholme Solicitors Counsel for the Respondents: Mr Howard of Counsel Solicitor for the Respondents: Arnold Bloch Leibler ORDERS
MLG 2577 of 2019 BETWEEN: ELIZABETH TAPPING
Applicant
AND: EMPRESS DIAMONDS PTY LTD (ACN 096 460 730) ATF EMPRESS DISCRETIONARY TRUST
First Respondent
GABI YITSHAKI
Second Respondent
ORDER MADE BY:
JUDGE BLAKE
DATE OF ORDER:
21 JUNE 2021
THE COURT DECLARES THAT:
1.The First Respondent contravened:
(a)Section 340(1)(a)(iii) of the Fair Work Act 2009 (Cth) (‘Act’) by dismissing the Applicant from employment for the reason that the Applicant proposed to exercise her workplace rights to take annual and personal leave;
(b)Section 44(1) and 117(2) of the Act by failing to provide the Applicant with four weeks written notice of termination, or payment in lieu of notice of termination;
(c)Section 536(1) of the Act by failing to give the Applicant a payslip within one working day of paying an amount to the Applicant in relation to the performance of work;
(d)Section 45(1) of the Act:
(i)By contravening clause 5 of the General Retail Industry Award 2010 (‘Award’) by failing to ensure that copies of the Award and the NES were available to the Applicant;
(ii)By contravening clause 16.1 of the Award by failing to advise the Applicant in writing of her classification under the Award;
(iii)By contravening clause 23.4 of the Award by failing to provide the Applicant with amounts due to her under the Award and NES within seven days after the dismissal being her payment in lieu of notice;
(iv)By contravening clause 32.3 of the Award by failing to pay the Applicant annual leave loading.
2.The Second Respondent was involved, within the meaning of section 550(2) of the Act, in the First Respondent’s contravention set out in order (1)(a) contained herein.
THE COURT ORDERS THAT:
3.The parties are directed to submit to chambers within 21 days of these orders a proposed minute of consent orders which contains directions for filing material for the hearing on penalty and compensation.
REASONS FOR JUDGMENT
JUDGE BLAKE:
The Applicant, Elizabeth Tapping, was employed by Empress Diamonds Pty Ltd, the First Respondent. The Second Respondent, Mr Gabi Yitshaki, is the owner of the business conducted by the First Respondent. The Applicant’s employment came to an end in May 2019. The circumstances relating to the Applicant’s cessation of employment with the First Respondent are at the heart of this matter. The Applicant alleges principally that her employment was terminated unlawfully and in breach of sections 340(1), 351(1) and 352 of the Fair Work Act 2009 (‘Act’). The Respondents deny the allegations. The Applicant also alleges the Respondents contravened other provisions of the Act relating to payment of employment entitlements, the maintenance of employment records, and the failure to make payments in accordance with an award.
For the reasons that follow, I have determined that the First Respondent dismissed the Applicant from her employment because she proposed to take personal or annual leave. I have determined the Second Respondent was involved in the contravention of the First Respondent. I have also determined that the First Respondent contravened other provisions of the Act and the General Retail Industry Award 2010 (‘Award’) relating to employment entitlements and payments in accordance with the Award.
BACKGROUND
The following facts are largely not in dispute, unless noted otherwise.
The Second Respondent commenced operating the business of the First Respondent in 2002. The First Respondent is a diamond wholesale company that sells diamonds to the public. It would be fair to describe the business as a small, family business. At times, the Second Respondent’s daughter and his wife have worked in the business.
The employees of the business assisted the Second Respondent in running the day to day operations. This involved preparing invoices, sending emails and other computer work. The Second Respondent’s daughter described the employees as ‘the right hand man’. The employees all worked together and would share tasks and roles, as well as assisting the Second Respondent.
The Applicant commenced employment with the First Respondent on 11 May 2015.
The Second Respondent’s daughter ceased working in the business of the First Respondent in March 2019, though she continued to provide some additional assistance to the Respondents after this date.
On 17 April 2019, the Applicant was absent from work on personal leave. She attended an appointment at St Vincent’s Hospital. She received a diagnosis of breast cancer.
On 18 April 2019, the Applicant telephoned the Second Respondent. The call duration was four minutes. The content of the call is in dispute.
From Friday 19 April 2019 until Sunday 28 April 2019, the business of the First Respondent was closed. The Applicant was away from work either on annual leave, or because some of the days in the period were public holidays.
On Monday 29 April 2019 and Tuesday 30 April 2019, the Applicant attended for work, and worked alongside the Second Respondent.
On Wednesday 1 May 2019, the Applicant was absent from work for at least half a day.
On Thursday 2 May 2019, the Applicant attended for work. She discussed her cancer diagnosis with the Second Respondent’s wife. The Applicant also asked Warren Sheppard about her annual leave and sick leave entitlements. Mr Sheppard is an advisor to the Respondents and provided assistance to the Respondents with BAS statements and tax returns.
On 3 May 2019, Mr Sheppard sent an email to the Applicant advising her that she had 15 days of accrued sick leave (which I shall refer to as personal leave), and 20 days of annual leave. The Applicant raised these calculations with the Second Respondent. He advised her that he did not owe her any annual leave or personal leave.
On Monday 6 May 2019 and Tuesday 7 May 2019, the Applicant attended for work alongside the Second Respondent.
On Wednesday 8 May 2019, the Applicant attended a medical appointment at around 2pm. She returned to work following that appointment. She had a conversation with the Second Respondent at around 4pm. The content of that conversation is hotly contested and is subject to further discussion below, however the Applicant formed the view following that conversation that her employment had been terminated by the First Respondent.
On Thursday 9 May 2019, the Applicant attended for work. She printed off an Employment Separation Certificate form (‘Certificate’) from Centrelink. Ultimately, the Second Respondent signed the Certificate. The content of the conversations and events leading to the Certificate being signed are a matter of dispute. In the Certificate, under the heading ‘Reason for Separation’, the following has been written: ‘can not keep position because of breast cancer treatment and can not hold job after.’
On Friday 10 May 2019, the Applicant was absent from work on personal leave.
On Monday 13 May 2019, the Applicant underwent major surgery. The surgery lasted for most of the day. On this day, the Applicant’s solicitors filed an application on her behalf with the Fair Work Commission (‘Commission’). The claim was made using the Commission’s Form F8 and is entitled ‘General Protections application involving dismissal’. At item 1.2 of the Form F8, the Applicant claimed she was notified of her dismissal on 8 May 2019. At item 1.3 of the Form F8, the Applicant claimed her dismissal became effective on 10 May 2019. She attached to the Form F8 a reasonably comprehensive account of what she alleged occurred in the lead up to, on the date of, and on the days after, the alleged dismissal (‘FWC Claim’).
Also, on 13 May 2019, the Second Respondent’s daughter, Ms Liron Murdechayev placed an advertisement on Seek for the First Respondent. The advertisement sought applicants for the position of ‘Sales and Admin Assistant’ for the First Respondent. The advertisement does not make any reference to the advertised position being a temporary position.
On Wednesday 15 May 2019, Ms Murdechayev sent an email to the Applicant wishing her a speedy recovery. The Commission also notified the First Respondent of the Applicant’s claim in the Commission on this date.
On 17 June 2019, the Second Respondent departed Melbourne for Moscow.
On 20 June 2019, the First Respondent filed its response to the Applicant’s claim in the Commission. The Response was prepared by Ms Murdechayev. In the Response, the First Respondent did not contend that the Applicant’s employment had not been terminated by it.
THE ADVERSE ACTION CLAIMS
Relevant Principles
The Applicant alleges that she was dismissed from employment:
(a)because she either was absent on personal leave on 17-19 April 2019, or on 1 May and 8 May 2019; or
(b)because she proposed to take a combination of annual leave and personal leave following her operation; or
(c)to prevent her exercise of her rights to take annual leave and personal leave.
The actions above are alleged to give rise to a breach of sections 340(1)(a)(ii) or 340(1)(a)(iii) of the Act.
The Applicant also alleges that she was dismissed from employment because she contracted cancer in contravention of section 351 of the Act, or because she was temporarily absent from work on 17-19 April 2019 in contravention of section 352 of the Act.
The Applicant carries the burden of proving the physical elements of the alleged contraventions of sections 340, 351 and 352 of the Act. Critically in this matter, she needs to prove on the balance of probabilities that her employment was terminated by the First Respondent. If she is able to prove her employment was terminated by the First Respondent, then the enquiry turns to why she was dismissed, or subject to adverse action. By section 361 of the Act, is it presumed the action was, or is being taken for the proscribed reason unless the First Respondent proves otherwise. The Briginshaw v Briginshaw (1938) 60 CLR 336 (“Briginshaw”) standard of proof governs the trial.
The resolution of the issue of whether adverse action occurred turns principally on a conversation that occurred between the Applicant and the Second Respondent at around 4pm on 8 May 2019. As a result of that conversation, the Applicant contends her employment was terminated. The Respondents deny this. The Court is therefore required to make a finding of fact based on the competing version of events offered by the Applicant and the Second Respondent.
In Watson v Foxman (1995) 49 NSWLR 315 at 318 – 19, McClellan CJ stated as follows when making findings about the content of oral conversations, albeit in the context of whether oral conversations were misleading:
Where the conduct is the speaking of words in the course of a conversation, it is necessary that the words spoken be proved with a degree of precision …
Furthermore, human memory of what was said in a conversation is fallible for a variety of reasons, and ordinarily the degree of fallibility increases with the passage of time, particularly where disputes or litigation intervene, and the processes of memory are overlaid, often subconsciously, by perceptions or self-interest as well as conscious consideration of what should have been said or could have been said. All too often what is actually remembered is little more than an impression from which plausible details are then, again often subconsciously, constructed. All this is a matter of ordinary human experience.”
The Principal Witnesses
Each of the Applicant and the Second Respondent gave evidence in this proceeding and were cross examined about that evidence.
The Applicant stood by her account of what occurred, despite rigorous cross examination by Counsel for the Respondents. She remained firm as to what occurred, particularly on the afternoon of 8 May 2019. She presented as credible and believable, as I was persuaded by her account, particularly as to the events on 8 May 2019.
The Second Respondent also stood by his account of what occurred. It is fair to say that he bristled at the suggestion he had terminated the Applicant’s employment when cross-examined. While the Second Respondent was forceful in giving evidence in the witness box that he had not terminated the Applicant’s employment, I ultimately was not persuaded as to the reliability of his evidence. As will become apparent from what I have set out later in these reasons, the Second Respondent, on occasion, had difficulty recalling the dates of conversations or when certain conversations occurred, or the content of such conversations. Given that he encountered that difficulty, I was not persuaded by his denial of key aspects of the conversation on 8 May 2019, as well as his denials of what the Applicant alleges occurred on 17 April 2019 and 18 April 2019. I did not believe the Second Respondent’s denials in relation to key events on these days given his obvious difficulty recalling the other events I have described. The Respondents also, in my view, for reasons which I come to later, were not able to adequately explain a number of actions taken by them subsequent to the dismissal which tend to support the Applicant’s account of events of 8 May 2019. Put another way, the Respondents explanations as to, for example, how the Seek advertisement came to be placed, or why they failed to deny the termination of employment alleged in the FWC claim, I regard as not credible. Ultimately, the Applicant was more credible and I did not believe key aspects of the Respondent’s evidence.
In making the observations above, it is pertinent to observe that this is one of those cases where the evidence at times goes a bit each way. An example of this is the Applicant’s account of her conversation with Ludmilla Yitshaki. The Applicant claimed to have had a conversation with Ludmilla Yitshaki on 2 May 2019, and claimed Ludmilla Yitshaki told her ‘good, you are leaving’ when Ludmilla Yitshaki heard of the Applicant’s diagnosis. The Applicant’s failure to cross examine Ludmilla Yitshaki, the Second Respondent’s wife, leads to the inevitable conclusion that Ms Yitshaki’s account of the conversation is to be preferred. While that produces an inconsistency in the evidence of the Applicant about that matter, that evidence is ultimately about an issue that does not have a bearing on the principal events under consideration in this matter, being the Applicant’s cancer diagnosis, her initial interactions with the Respondents about that diagnosis and their attitude to it, and ultimately what occurred on 8 May 2019.Taking this and other inconsistencies into account, I nevertheless find the Applicant to be the far more reliable and credible witness in this matter.
The Evidence
The Events of 17 April 2019
The Applicant’s evidence is that she took a day of personal leave on Wednesday 17 April 2019 to attend St Vincent’s Hospital for a medical appointment. Her partner, Mr Jeff Woods, attended the appointment by teleconference. During the appointment, she received a diagnosis of aggressive breast cancer. She was informed she would need surgery and would require approximately 4 to 6 weeks off work in order to recover from the surgery. The Applicant was understandably devastated by this news.
The Applicant says that following the appointment, at around 12.30pm that day, she rang Mr Woods and asked him to telephone the Second Respondent to relay the diagnosis. She says that Mr Woods telephoned her around 1.00pm that day and told her that the Second Respondent did not appear concerned about her health and only asked how it would affect the business.
Mr Woods gave evidence in relation to the telephone call above with the Second Respondent. He says that upon informing the Second Respondent that the Applicant had breast cancer, the Second Respondent replied, among other things, ‘does that mean she can’t work?’
The Applicant then says she received a further call from Mr Woods at around about 4pm that day, in which Mr Woods informed her that the Second Respondent had told him ‘I’m going to have to let Liz go. I’m running a business and I don’t know when she is going to be here and when she is not’. Mr Woods’ evidence supports the Applicant’s account of this conversation.
The Second Respondent, agreed that he had a conversation with Mr Woods on 17 April 2019. He says he had only one conversation with Mr Woods and not two conversations. He claims that, during the conversation, Mr Woods informed him of the Applicant’s breast cancer diagnosis. The Second Respondent says he asked Mr Woods whether he could help with anything, that Mr Woods replied ‘no’ and also replied that the Applicant would need a couple of days off after Passover. The Second Respondent says he then told Mr Woods that the Applicant could take the rest of the week off and come back to work on Monday.
Phone records were tendered to the Court (Exhibit A6, phone records of Mr Woods). Those records confirm Mr Woods’ version of events that he spoke with the Second Respondent twice on 17 April 2019. The records also indicate that the second call between Mr Woods and the Second Respondent was initiated by the Second Respondent.
While the phone records support Mr Woods’ evidence that he had two telephone calls with the Second Respondent on 17 April 2019, the Respondents nevertheless submitted that Mr Woods evidence as to the content of his conversations with the Second Respondent should not be accepted. The Respondents submitted that given Mr Woods’ criminal history, which includes historical convictions for offences that might be described generally as convictions for dishonesty offences, his evidence should not be preferred over that of the Second Respondent. Mr Woods, for his part, owned up to his criminal history but said in effect that he had moved on from that part of his life which he regretted, and stood by the content of his conversations with the Second Respondent.
In view of all the evidence, I find that Mr Woods and the Second Respondent spoke to each other twice on 17 April 2019. I find that during those conversations, Mr Woods informed the Second Respondent about the Applicant’s breast cancer diagnosis.
There is then the question of whether the Second Respondent asked Mr Woods whether the Applicant could not work, and whether he expressed concern to Mr Woods about running the business as alleged. On the balance of probabilities, I am satisfied that the Second Respondent during his discussions with Mr Woods asked ‘does that mean she can’t work?’ and that he said words to the effect of ‘I don’t know when she is going to be here and when she is not’. I accept this evidence because Mr Woods has given consistent evidence about his interactions with the Second Respondent, whereas the Second Respondent’s recollection of what occurred is vague - he could not recall the conversations that he had. I also consider it inherently likely given the other evidence before the Court about the nature of the business operation, the fact that everyone assisted with many tasks in the business, and the fact that the Second Respondent relied on the Applicant to assist with translation of English documents, that he would have naturally been concerned about how he was going to manage in the absence of the Applicant.
The Events of 18 April 2019
On Thursday 18 April 2019, the Applicant remained on personal leave and absent from work. The Applicant says that she telephoned the Second Respondent. Her evidence is that she told the Second Respondent that she had been diagnosed with aggressive breast cancer, needed an operation, and could be off work for five weeks. The Second Respondent is said to have replied ‘I can’t keep your job’. The Applicant asked him whether he could wait until she received more information. The Second Respondent allegedly replied to the effect ‘oh yeah, but I run a business’.
In the Further Amended Defence, the Second Respondent initially did not admit to any conversation with the Applicant on or about 18 April 2019, or at any time prior to her return to work on 29 April 2019, as he could not recall it. By the time of filing his affidavit for trial in April 2020 and having been shown a telephone record, he admitted a conversation took place. His evidence about the telephone call is somewhat unconvincing. Despite being unable to recollect the call, he said that ‘she definitely did not tell me that she had breast cancer on that phone call’. His further evidence about the content of the call, which was four minutes in length, is that it ‘would’ have been about her ‘sick leave that day and about work’.
Telephone records were placed before the Court (annexure ET-4 of the Applicant’s affidavit filed on 27 March 2020). They confirm that the Applicant spoke with the Second Respondent on 18 April 2019 at around 12.36pm.
The Respondents submitted, among other things, that the Applicant’s account of the conversation on 18 April 2018 should not be accepted. It was submitted that the account in her affidavit differed from the account set out in the FWC Claim document.
When all of the evidence is considered, I find that there was a telephone call that occurred between the Applicant and the Second Respondent on 18 April 2019. The telephone record supports the Applicant’s evidence of the call having taken place.
Further, when all of the evidence is considered, I prefer and accept the evidence of the Applicant in relation to the content of the telephone call between the Applicant and the Second Respondent on 18 April 2019. The Applicant has at all times given a consistent account of that conversation. She stood by that firmly in the witness box. While the Respondents sought to make much of what they regarded as the inconsistencies between the Applicant’s affidavit evidence and what was contained in the FWC Claim, there are two matters to bear in mind. First, while the FWC Claim contains an account of some conversations the Applicant has now accepted did not occur, her recollection of this conversation in the FWC Claim is consistent with what is set out in her affidavit. Second, I am prepared to accept that the FWC Claim was prepared in a very short period of time, when the Applicant was finishing work and preparing for major surgery. The fact that the FWC Claim was filed on the day she was in major surgery indicates to me that it is likely she did not have proper time to comprehensively review the minutiae in it prior to its filing.
Further, as I have indicated above, the Second Respondent’s evidence about the call was not convincing. He could only recall it when prompted by the production of a telephone record. His evidence about the call is inconsistent. In his affidavit, he states that he did not speak to the Applicant about her breast cancer diagnosis on that telephone call and that he first heard about it from Mr Woods. Plainly that evidence is not correct now that it has been established that the phone call between Mr Woods and the Second Respondent occurred on the day prior. Given the inconsistencies or lack of recollection, I do not accept the Second Respondent’s evidence during cross examination, including that he did not say to the Applicant ‘I can’t keep your job’, and his denial that he expressed more concern for the business impact of the Applicant’s illness. Indeed, as I have indicated earlier, it would have been natural given the nature of the business operation for the Second Respondent to be concerned about business impacts and to express a concern about how the business would operate. In making these findings, I accept that the Second Respondent also, as was his evidence, expressed concern for the Applicant’s well-being. While expressing that concern, I am also of the view that he was also very concerned about how he was going to operate the business given the circumstances that confronted the Applicant and her ability to continue to work, and he made that clear to the Applicant.
29 April 2019 – 1 May 2019
The Applicant returned to work on 29 April 2019 and worked on that day and the following day, apparently without incident. On 1 May 2019, the Applicant attended a medical appointment. Her evidence is that she returned to work at around midday with a medical certificate which she handed to the Second Respondent. The Applicant says the Second Respondent refused to take the medical certificate. She then says they had a conversation. The Second Respondent allegedly asked what was happening to which the Applicant replied she did not know yet, and did not have any dates. The Second Respondent allegedly indicated to the Applicant that he could not wait, that he needed to run a business, and that she should not talk to him about her illness and work until she has dates. The Applicant claims that when she said that she would need time off work to recover, the Second Respondent replied that he had a business to run. The Applicant then says she told the Second Respondent that he could get a ‘temp’ in.
In his affidavit, the Second Respondent does not offer a version of this conversation or deny it. His evidence is simply that he and the Applicant had a generic conversation about her well-being, and that during the week they continued to talk about her cancer diagnosis. Under cross-examination, he simply denied the conversation occurred. I am satisfied this conversation as alleged by the Applicant occurred. The Second Respondent’s evidence on the point was unconvincing, and he had difficulty recalling the dates and content of conversations.
The Alleged Dismissal on 8 May 2019
It is the events on this day that are critical in respect of the claim.
The Applicant attended a medical appointment at 2pm. She returned to work at 4pm. Her evidence is that on her return to work, she had a conversation with the Second Respondent. Her account of the conversation is as follows. She informed the Second Respondent that she had an operation scheduled for the following Monday. He asked her how long she would be off work. She told him maybe to 2 to 3 weeks but that she could return earlier to do light duties. The Second Respondent asked what she cannot do and she answered him. The Applicant then told the Second Respondent that she had contacted the accountant (Mr Sheppard) and had available to her holiday and sick pay (paid annual leave and personal leave) that would cover the period. The Second Respondent allegedly replied that the Applicant and Mr Sheppard were ganging up on him and that it could be six weeks followed by chemotherapy. The Applicant replied she didn’t know yet what period she would be away from work. The Second Respondent then replied that he had a business to run, to which the Applicant stated that he could get a temp in for a time, or his daughter could assist. The Second Respondent replied that that was no good and that he needed to find someone to work and train. The Applicant then said okay, that she would come back and there will only be a temporary position. The Second Respondent then allegedly said ‘no, you don’t come back’. The Applicant asked him ‘what do you mean? Are you giving me the sack?’. The Second Respondent allegedly replied ‘yes’. The Applicant replied that the Second Respondent could not do that as it’s against the law. The Second Respondent allegedly replied ‘your law is your law, my law is my law’. The Applicant then said she should get two weeks’ severance pay and that she was owed holiday pay. The Second Respondent allegedly replied ‘you are getting nothing. I owe you only your weeks’ pay that you have worked up to’. He also allegedly said to her that she was required to stay and work out the week because ‘if you leave today, I am not paying you the two days’.
The Second Respondent admits that he had a conversation with the Applicant following her medical appointment at around 4pm. His account of the conversation is entirely different. He says he asked her about the appointment and she replied that she needed nine days of leave for the operation, and six weeks recovery time. The Second Respondent says he told her he needed more notice than that and that he needed to find someone else, and to sit down with the Applicant and work out a plan. He says that the Applicant told him that it was not ‘my problem’. The Second Respondent said he told her that was fine, that she was sick, and that she should finish off what she was doing and that he would talk to her tomorrow. The Second Respondent then says that the Applicant raised the question of her sick and annual leave entitlements, and that he replied he owed her nothing.
Self-evidently, it is difficult to reconcile these competing accounts. There is not an independent witness to the conversation. Neither party made a note of the conversation. There is, however, documentary and other evidence that occurred subsequent to the conversation on 8 May 2019. It is to that evidence which I now turn.
First, there is evidence before the Court of how the Applicant apparently reacted to the conversation with the Second Respondent. In the immediate aftermath of the conversation with the Second Respondent on 8 May 2019, the Applicant sent Mr Sheppard an email at 4.51pm explaining that she was told by the Second Respondent that she was not owed anything in respect of leave and holiday pay, and asking Mr Sheppard to explain the situation to the Second Respondent. The email does not mention the Applicant has been dismissed from employment, or sacked. The Applicant then sent a second email to Mr Sheppard at 4.57pm in which informed him that ‘Gabi has just given me the sack because I can’t work because I have cancer’. The Applicant attached to her affidavit a text message she sent to Mr Woods at 4:58pm on 8 May 2019. In that text message, she informed Mr Woods that ‘Gabi just gave me the sack’. It is notable, given some of the submissions advanced by the Respondents to the effect that that the Applicant (and to some extent Mr Woods) were trying to take advantage of the Second Respondent, that the first telephone communications between the Applicant and Mr Woods on 8 May 2019 only occurred after the conversation between the Applicant and the Second Respondent. Telephone records of Mr Woods and the Applicant disclose that the first calls between them on that day occurred after 5pm. The evidence I have recounted above is as close to a contemporaneous record of what occurred at the meeting. In that respect, it is reasonably contemporaneous evidence that supports the Applicant’s version of events that she was dismissed on 8 May 2019.
There is then the Certificate dated 9 May 2019 signed by the Second Respondent. The Applicant relies on the Certificate in support of the submission that her employment was terminated by the First Respondent on 8 May 2019.
In the Certificate, the employment cessation date is stated as being 10 May 2019. Under the words ‘reason for separation’, the following is stated: ‘can not keep position because of breast cancer treatment and can not hold job after. The Certificate is signed by the Second Respondent. There is no dispute that the form was completed by Applicant. The evidence as to how the Certificate came to be signed and completed is as follows.
The Applicant’s evidence is that on 9 May 2019, she attended work. She says that she had a conversation with the Second Respondent that occurred both in the kitchen and also in the office. Her evidence about that conversation was to the following effect. She claims that she told the Second Respondent that because he had sacked her, she had a certificate that needed to be filled in so she could apply for Social Security payments. The Second Respondent in reply told her to fill in what needs to be filled in. She says that she then filled in the company details and her own details. The Applicant then says that she asked the Second Respondent what he wanted her to write in the section of the form entitled ‘reasons for separation’. The Second Respondent allegedly replied ‘just what is going on’. The Applicant says that she pressed him as to what he wanted her to write. The Applicant claims the Second Respondent allegedly said ‘cannot keep position because of breast cancer treatment and cannot hold job after’. The Applicant says that she asked him whether he was sure that was what he wanted written on the Certificate to which the Second Respondent allegedly replied ‘that’s the truth’. The Applicant then claims that she wrote the words on the Certificate. The Applicant then claims she read the words back to the Second Respondent and he said ‘just give it to me’ and then reviewed and signed the Certificate. A copy of the Certificate was in evidence before me (annexure ET-15 of the Applicant’s affidavit filed on 27 March 2020).
The Second Respondent has a different account of what occurred. First, in the Further Amended Defence, the Second Respondent admitted that the Applicant asked him to sign a Centrelink form so that she could apply for Centrelink payments. The Second Respondent says the basis for this request was undisclosed. In his affidavit material, the Second Respondent says that when he came to work on 9 May 2019, he asked the Applicant how she was going and she said nothing. He then says that around 1pm, the Applicant came into his office and told him that because she was not going to be paid for time off, she needed to go to Centrelink and that she needed the Certificate. The Second Respondent then says the Applicant gave him the Certificate to sign, on which nothing was written, and he signed it. His evidence is that he assumed the Applicant would complete the rest of the Certificate.
It is appropriate to record two further aspects of the Second Respondent’s evidence. First, he says he understood that completion of the Certificate was necessary in order for the Applicant to receive government assistance. He says that the Applicant told him the Certificate needed to be completed for this purpose, that he trusted her, and therefore signed it. Second, he understood that the Certificate was a ‘separation’ certificate.
Apart from the Certificate and the evidence of the parties, the Court had before it video evidence of the Certificate being signed. That evidence captures the Applicant walking into the Second Respondent’s office, handing him a document, and him signing it, and then her leaving. The video runs for around 13 seconds. There is not audio accompanying the video.
There was a dispute between the parties as to whether the Second Respondent is able to read English such that he could understand the content of the Certificate. I accept that the Second Respondent has a limited grasp of written English. I accept that he may be able to understand the meaning of words on documents he sees regularly in his business, for example, invoices. I am not persuaded, however, that his command of written English is such that he could understand documents with which he was not familiar such as the Certificate. I accept that he relied on the Applicant (and others) to assist with translating written English.
Ultimately, I do not regard it as necessary to resolve the competing counts of the parties as to the circumstances in which the Certificate is signed, or how the words under the heading ‘reasons for separation’ came to be written on the document. That is because while the Second Respondent may well have thought that he was signing the Certificate to assist the Applicant to obtain Social Security payments (and I accept his evidence about this), he also understood that he was signing a document that concerned ‘separation’. Those two things – the need for social security and that the document concerned ‘separation’ are important. In the context of what had occurred between the Applicant and the Second Respondent up to that point in time, reference to separation could only have meant a separation by the Applicant from her employment with the Respondents. In reaching that conclusion, I have taken into account the Second Respondent’s limited grasp of English. Notwithstanding that, however, I am satisfied in light of other factual findings I have made that the Second Respondent was aware that ‘separation’ in the context of the Certificate meant that the Applicant’s employment was at an end. Accordingly, when these matters are considered, I am satisfied that the Certificate supports the Applicant’s account that she was told on 8 May 2019 that her employment was to be terminated.
The next document is a job advertisement posted by the Respondents on Seek on 13 May 2019. The position advertised was for ‘Administration and Office Support, Client and Sales Administration’ with a salary range of $40,000 - $54,999. There is nothing in the advertisement to suggest that the position advertised was temporary. The Applicant alleges the position advertised is her position. The Applicant submits that the advertisement corroborates her evidence that her employment was terminated in a discussion with the Second Respondent on 8 May 2019.
The Respondents contended that the job advertisement did not support a finding that the Applicant’s employment had been terminated. The job advertisement was prepared and placed on Seek by Ms Murdechayev. The Second Respondent’s evidence is that he instructed Ms Murdechayev to advertise for a temporary replacement, someone to help him read emails and use the computer, while the Applicant was recovering. Ms Murdechayev’s evidence is that the Second Respondent asked her to find someone to help fill in while the Applicant was not there, and that she subsequently the placed the advertisement on Seek.
There are five aspects of the Respondents’ evidence in relation to this issue which bears close examination. First, prior to any decision to place an advertisement, Ms Murdechayev was aware that the Applicant considered her employment to be at an end because the Applicant had sent her a text message on 10 May 2019 which said she had been given the ‘sack’. In respect of this, Ms Muredechayev said that she thought nothing of the message from the Applicant on 10 May 2019 as, among other things, she was busy with her own work and family. The message from the Applicant was as follows:
I am unwell today, with having breast cancer and you giving me the sack from my position. The stress has triggered a migraine. Sorry Liz
Second, Ms Murdechayev deposed to a conversation she had with the Second Respondent regarding his request for her help while the Applicant was having treatment, and the dismissal of the Applicant. Her evidence about this conversation was as follows. The Second Respondent asked Ms Murdechayev for help while the Applicant was having treatment. Ms Murdechayev said to the Second Respondent that the Applicant said she was sacked in the text message. The Second Respondent stated that the Applicant wasn’t sacked by him and that she ‘was angry at him’. Ms Murdechayev’s evidence about this conversation is brief and she once again states that she did not think much of it because she was busy and stressed. I add here that I do not doubt that Ms Murdechayev was stressed at the time and I accept she suffered a difficult loss around the time these events were occurring.
Third, Ms Murdechayev, while maintaining that she had been instructed by the Second Respondent to find someone to fill in for the Applicant, admits to confusion about the text message from the Applicant, and what the Second Respondent told her. I accept Ms Murdechayev may have been confused. It is apparent on her own evidence, however, that she did not take adequate steps to clarify the situation prior to preparing the advertisement for the Second Respondent. It is also clear, however, that Ms Murdechayev understood the Applicant considered her employment to have been ended by the Respondents.
Fourth, it is significant in my view, given the confusion that Ms Murdechayev admits to, that the advertisement does not specify that the role on offer is to be a temporary position. One would have thought that if Ms Murdechayev was as confused as she claimed, she would have taken steps to clarify with the Second Respondent whether the position being advertised was temporary or ongoing, prior to taking the significant step of placing an advertisement for a new person, in an ongoing role, in a small business.
Fifth, a review of the advertisement discloses that many of the tasks that are set out in that advertisement were tasks performed by the Applicant in her employment. The Respondents sought to make much of the fact that the Applicant held the title of Sales Manager, while the advertisement was for an administration role. I accept that the title of the advertised role is different from the title held by the Applicant while employed. However, in my view, it is a distinction without a difference in the circumstances of this case. Placing undue focus on the title of the role ignores the reality that this was a small business. Ms Murdechayev’s evidence under cross examination was that many of the roles in the business were shared and that everything was done together. That evidence accords with the reality of how a small business operates. I therefore do not place any significance on the fact that the title of the position advertised for was not the same as the title of the position held by the Applicant. I do, however, consider the following matters to be important. First, the advertised role specified a salary range, and the Applicant’s salary at the time of termination of her employment fell within the advertised range. Second, the tasks set out in the advertisement were similar to many of the tasks performed by the Applicant. Third, the Second Respondent’s own evidence under cross examination was that he only ever intended to engage one employee. Fourth, the advertisement was placed for an ongoing role in the immediate aftermath of the conversation on 8 May 2019 when the Applicant claims she was dismissed.
When all of the above matters are considered, I find that when the Respondents advertised the position, they were looking for a full-time employee to replace the Applicant in her role. I consider the advertisement supports the Applicant’s account of what occurred between her and the Second Respondent on 8 May 2019, namely that she had been dismissed on that day. The advertisement was placed so that someone could fill her position in the business and the advertisement on Seek did not specify the position was temporary.
There is then the Applicant’s claim filed in the Commission and the Respondent’s Response to that claim that was also filed in the Commission. As noted earlier, the Applicant filed a claim in the Fair Work Commission on 13 May 2019. The claim was made using Form F8, which the Commission identified as ‘General protections application involving dismissal’. In the Form F8, completed by the Applicant’s lawyers, the Applicant claims to have been notified of her dismissal on 8 May 2019, and that her dismissal took effect on 10 May 2019. Various breaches of the Act are alleged before the claim is outlined in the FWC Claim document.
The First Respondent filed a Response to the claim in the Commission on 20 June 2019. The First Respondent indicated on the form that it did not agree with information given by the Applicant in the Form F8. The First Respondent then set out in the form in some detail its response to the Applicant’s allegations. Nowhere in that detailed response at point 2.2 in the Response form does the First Respondent contest the Applicant’s claim that she was dismissed from employment.
The Applicant submits that the failure of the First Respondent to contest the dismissal of the Applicant in its Response to the claim in the Commission further corroborates her claim that she was dismissed on 8 May 2019.
The Respondents sought to dispute the significance of the Response form that was filed in the Commission. They led evidence that the Second Respondent was out of the country, and that it was Ms Murdechayev that completed the form. Each of these matters warrants close consideration.
The FWC Claim was received by the Respondents on 15 May 2019. The Second Respondent departed Melbourne for Moscow approximately four weeks later on 17 June 2019. The Respondents’ Response to the FWC Claim was filed on 20 June 2019. I accept that Ms Murdechayev was the person that filed the form in the Commission on 20 June 2019. I do not accept, however, that the Respondent’s Response was prepared in circumstances where the Second Respondent was denied the opportunity to contribute to it because he was out of the country. Plainly, there was a four week period during which the Second Respondent was in the country after having knowledge of the claim. It was open to Ms Murdechayev to discuss the FWC Claim with the Second Respondent and it was open to him to contribute to it. It is significant, in my view, that despite that opportunity, when the Response was filed, the Respondents did not contest the dismissal of the Applicant.
I accept that Ms Murdechayev was subject to a range of pressures at the time she completed the Response on behalf of the First Respondent. I accept she is not a lawyer, and I am prepared to infer she has not had to deal with proceedings in the Commission before. Notwithstanding all of that, however, I find it difficult to accept that Ms Murdechayev did not understand that the claim forms raised, inter alia, a claim by the Applicant to have been dismissed from employment. The word ‘dismissal’ as well as featuring in the bolded heading to the Form F8 features throughout the document. Further, Ms Murdechayev was aware that the Applicant had claimed to have been dismissed, being the recipient of a text message from the Applicant on 10 May 2019. Ms Murdechayev also had the opportunity to clarify matters with the Second Respondent prior to filing the Response form.
Having regard to the above matters, I regard the Response as tending to corroborate the Applicant’s evidence that she was dismissed from employment on 8 May 2019.
Other Matters Raised by the Respondents
The Respondents advanced a number of other submissions as to why the Second Respondent’s account of what occurred on 8 May 2019 should be preferred over the Applicant. Those submissions were set out on pages 5 -14 of the Respondents’ annotated closing the submissions. It is appropriate to briefly consider those submissions.
The Respondents contended that the conversation on 8 May 2019 was ‘incredulous’ and given its ‘inherent gravity’, unlikely to have occurred. I do not accept that description of the conversation. The Second Respondent was concerned about the impact on the business. It is not ‘incredulous’ that the conversation would have occurred against that background. Moreover, this Court deals every day with remarkable accounts of dismissal. In my view, the mere fact that the conversation may be unexpected does not mean it did not occur.
The Respondents contended there were inconsistencies in the Applicant’s account and in her behaviour following the alleged dismissal. For example, it was contended that the email she sent to Mr Sheppard initially did not raise her dismissal, and her return to work on 9 May 2019 is inconsistent with a person who has been dismissed. I have indicated earlier that this is a case where the evidence goes both ways at times and my reasons for preferring the Applicant’s account of key events. I further consider there is not any contradiction that is disclosed from the Applicant’s email of 4.51pm on 8 May 2019 and her email of 4.57pm on 8 May 2019. The fact that she did not six minutes earlier inform Mr Sheppard of her dismissal is neither here nor there. Nor is the fact that she returned to work on Thursday, 9 May 2019. That action is consistent with her account of the conversation she had with the Second Respondent, where she was told that she would not be paid unless she completed the last two days work. It is also consistent with the actions of a person who is facing significant time away from work without pay. Her return to work the next day is also consistent with her need to obtain the Certificate.
The Respondents made number of submissions about the strategy or motives of the Applicant. They contended that the Applicant’s engagement of her lawyers in the week of 6 May 2019 was inconsistent with the Applicant’s account of the conversation. The Respondents also submitted that the Applicant had little time or opportunity to engage a lawyer. Indeed, during the trial, the Applicant was cross examined about a phone call she made to her lawyers on 9 May 2019 when in the office. The Respondents then submitted that the strategy engaged in by the Applicant should be seen as the Applicant seeking to take advantage of a vulnerable person who has little command of English.
I reject entirely the characterisation of events outlined above. If anyone was vulnerable in the situation as it developed, it was the Applicant. She was the one that was diagnosed with an aggressive form of cancer. She was the one that was facing major surgery. She was the one who faced a significant period of recovery, time off work and loss of income. She queried her leave entitlements like anyone else would. She kept her employer informed of her progress. Given the circumstances that she was faced with, she was entitled to seek advice. None of these things, in my view, discredit her. The conduct of the Applicant falls far short of disclosing a deliberate strategy to take advantage of the Respondents or the situation.
The Respondents also criticised what they labelled as the ‘mud slinging’ engaged in by the Applicant. In my view, ‘mud slinging’ such as it is was, was engaged in by both sides in this proceeding. The Applicant raised matters in her evidence that I struck out. The Respondents however also included material that was unnecessary. By way of example, see the affidavit of Ms Murdechayev where she deposed to the Applicant’s conduct in other proceedings, or the Respondents’ Fair Work Commission Response which detailed matters not relevant to the issues at hand. None of this assisted the Court.
The criticism by the Respondents of, inter alia, the Applicant’s FWC Claim document as being ‘a quintessential example of inexact proofs, indefinite testimony and indirect references’ also warrants comment. It is clear that the claim document was prepared in a very short period of time and in very difficult circumstances where the Applicant considered she had been dismissed from work and was facing a life-threatening illness. That it contains some inaccuracies or inconsistencies as to dates may be expected given the circumstances in which the document was prepared. However, on the key events of 8 May 2019, it is consistent with the Applicant’s account.
In summary, I do not accept the Respondents’ submissions that there are a range of matters which means I should not feel an actual persuasion that the conversation alleged by the Applicant occurred. To the contrary, I am persuaded for all of the reasons articulated above that the conversation as alleged by the Applicant occurred.
Findings in Respect of Dismissal
In light of the above, I make the following findings in relation to the conversation that occurred on 8 May 2019. I find that on or around 4pm that afternoon, the Applicant had a conversation with the Second Respondent. During that conversation, she informed him of the date of her operation. The Second Respondent enquired as to how long she would be off work for. The Applicant told the Second Respondent that she had spoken with Mr Sheppard and that he informed her she had holiday and sick leave covering the period, to which the Second Respondent replied that Mr Sheppard and the Applicant were ganging up on him. I am satisfied that the Applicant told the Second Respondent that she did not know how long she would be off work for, and that the Second Respondent told her that he had a business to run. I am satisfied that the question of a temporary employee was raised for discussion. I find that the Applicant eventually asked the Second Respondent whether she was being given the ‘sack’. I find that the Second Respondent either replied ‘yes’ or told her not to come back, thus effecting her dismissal from employment. I am also satisfied that the Second Respondent told the Applicant that she must work out the remainder of week if she wanted to be paid.
In light of the findings of fact above, I am satisfied that the Applicant’s employment was terminated by the First Respondent.
Was the Adverse Action Taken for a Proscribed Reason?
The question of whether the Applicant’s employment was terminated for a reason proscribed by the Act is to some extent bound up with the issue of her dismissal. The Respondents’ principal defence to the claim was that the Applicant had not been dismissed from employment. As I have found that the First Respondent terminated the Applicant’s employment, it is necessary to consider the reason why the dismissal occurred, and whether the dismissal occurred for a proscribed reason. In assessing this issue, if the Respondents are to succeed, they must overcome the reverse onus of proof set in section 361 of the Act.
The Respondents made a number of submissions as to why the Court should conclude that the Applicant was not dismissed for a reason proscribed by the Act. Among other things, the Respondents contended there was no evidence to support the claim that the Applicant was dismissed because she accessed personal leave on 17-19 April 2019 and also on 1 May and 8 May 2019. It was also submitted that there was no evidence to corroborate the claim that the Applicant had been dismissed because she had contracted breast cancer. Finally, it was submitted that there was no evidence to support the allegation that the Applicant was dismissed because she proposed to take annual leave and personal leave to recover from her operation to remove cancer.
A theme running through the Respondents’ submissions above is that there is ‘no evidence’ to support the dismissal having occurred for a proscribed reason. That submission insofar as it relates to the reason for termination, fails to pay sufficient regard to the terms of section 361 of the Act.
I am satisfied that the Applicant was not dismissed because she accessed personal leave on 17-19 April 2019, 1 May 2019 and 8 May 2019. The Second Respondent denied dismissing the Applicant for this reason. That denial in my view is supported by other evidence including the following. First, on each occasion, the Applicant was permitted to take the leave and to return to work after taking the leave. Second, the evidence is, and I accept, that the Applicant regularly took personal leave throughout her employment without sanction. She was always permitted to take such leave. In short, the surrounding evidence, such as it is, corroborates the evidence given by the Respondents that the Applicant was not dismissed because she accessed personal leave on the days specified.
The question of whether the Respondents dismissed the Applicant because she had contracted breast cancer, or because she proposed to take annual and personal leave, requires consideration.
The evidence before the Court is that the Second Respondent expressed some concern about the Applicant’s welfare, had allowed the Applicant to take personal leave up until 8 May 2019, relied on the Applicant to conduct the business, had invested in her training, and had been advised by his accountant, Mr Sheppard, to negotiate a plan with the Applicant. I accept all of these matters. Ultimately, however, I regard them as being of little significance when regard is had to what occurred on 8 May 2019.
The events of 8 May 2019 need to be considered in context. The First Respondent is a small business and everyone pitched in to perform a range of tasks. Ms Murdechayev had been present in the business, but had stepped back for other reasons. The Applicant had been in the business for some years. She knew how it operated. The evidence is, and I accept, that she had come to be relied on by the Respondents.
The Applicant’s diagnosis in April 2019 came as a surprise not only to the Applicant, but the Second Respondent. While I accept that the Second Respondent was concerned for the Applicant’s health, he was also very concerned about how he could continue to operate with an employee who faced a significant health crisis. Those concerns were expressed by him as early as 17 and 18 April 2019. While he expressed those concerns at that time, he did not take any action at that time given the lack of information available as to the period of incapacity the Applicant would face.
By the 8th of May 2019 however, the situation confronting the Respondents had crystallised. On that date, the Respondents learned the following for the first time: that the Applicant was to have an operation on the following Monday, that the operation was significant, that the Applicant would be off work for some weeks, that the Applicant would only be able to return to do light duties and that the Applicant wished to take annual leave and personal leave that she had discussed with Mr Sheppard to cover her absences. Furthermore, this was all conveyed to the Respondents on reasonably short notice, with the conversation occurring on a Wednesday and the Applicant to undergo surgery the following Monday. All of this would have come as a surprise to the Respondents. The Second Respondent was being presented with a situation, without much notice, in which the Applicant was going to be unavailable for work almost immediately, was not going to be at work for a significant period and moreover, there was not any indication as to what work she would be able to perform when she returned.
While the Second Respondent denies that he terminated the Applicant’s employment or that he terminated her employment when she proposed to exercise her workplace rights to access leave, or to prevent her exercising her workplace rights to leave, I am unable to accept the denials given the matters to which I have referred above. The Second Respondent expressed concerns about the Applicant’s absence when first hearing about her diagnosis. I accept he talked with Mr Sheppard about putting together a plan, but there is not any evidence from him that he took any step to action that plan between speaking to Mr Sheppard and the discussion on 8 May 2019. He certainly did not discuss any plan with the Applicant despite the two of them working together on 6 and 7 May 2019. In any event, things changed on 8 May 2019 where, as I have noted, he was presented with a range of information for the first time, with little notice. In my view, the Second Respondent likely panicked when presented with the facts, which included the proposals to take leave, and dismissed the Applicant from employment.
When these matters are considered, I find that the Applicant’s employment was terminated because she proposed take a period of lengthy and indeterminate personal leave and annual leave. Clearly she was going to be absent from work. The Respondents did not know for how long that absence would last, nor did they know what capacity for work the Applicant would have when she returned to work. Those matters, in my view, led to the Respondents terminating the employment of the Applicant. Those actions by the First Respondent constituted a breach of section 340(1)(a)(iii) of the Act.
The Applicant advanced two other principal claims. The first was that the Applicant was dismissed from employment in breach of section 351(1) of the Act because she was dismissed for contracting breast cancer. The second was that the Applicant was dismissed because she was temporarily absent from work due to illness for the period 17 April 2019 to 19 April 2019. In light of the findings I have made above, and an exchange I had with the Applicant’s counsel at the outset, it is not necessary for me to consider whether the Applicant was dismissed because she had breast cancer or whether she was dismissed because she was temporarily absent from work in the period 17 April 2019 to 19 April 2019
THE ALLEGED CONTRAVENTIONS OF SECTION 44 OF THE ACT
The Applicant claims that the First Respondent dismissed her from employment without providing four weeks’ notice or payment in lieu, in contravention of section 44(1) and 117(2) of the Act. I have already found that the Applicant was dismissed from employment by the First Respondent, and that she did not resign from, or leave her, employment. Plainly, the First Respondent did not provide the Applicant with notice of termination or payment in lieu of notice. In the circumstances, I am satisfied that the First Respondent has contravened sections 44(1) and 117(2) of the Act by failing to give the Applicant notice of termination, or payment in lieu of notice of termination.
The Applicant also claimed that she did not receive from the First Respondent a payment in lieu of her accrued but untaken annual leave at the end of employment, in contravention of section 44(1) and 90(2) of the Act.
I was informed by the Applicant’s counsel during opening submissions that the outstanding annual leave claimed was approximately 17 hours. In light of that information, I queried the parties on whether the Court’s time was being properly utilised on this issue given the seemingly small amount in question and the bigger issues that loomed in the trial. This resulted in the Respondents making a payment to the Applicant of an amount equivalent to 17 hours accrued but untaken annual leave on a no admissions basis. For reasons known only to the Applicant, however, the claim in respect of a failure by the First Respondent to pay accrued but untaken annual leave on termination of employment was not withdrawn and I am left to deal with it.
There are a number of observations to be made about this claim. The amount of annual leave said to be unpaid was not quantified by the Applicant in the Amended Statement of Claim. This was despite an indication that particulars would be provided. The Applicant initially claimed an outstanding annual leave balance of 20 days based on a communication that she received from Mr Sheppard. It then seems this amount was revised by both sides. Ultimately, as I have noted above, the Applicant claimed to be owed approximately 17 hours of accrued, untaken annual leave.
The parties provided to the Court competing calculations of the annual leave said to have been taken by the Applicant during her employment. Counsel for the Applicant attempted to assist the Court to understand the competing allegations of the parties by providing a table entitled ‘Comparison of Liron’s annual leave calculation at CB363 with Liz’s claimed actual annual leave and the wages spreadsheet at WS-1’ (‘AL Comparison Document’). Ultimately, it was this document that formed the basis of the party submissions, and was used in the cross examination of the witnesses.
The Respondents submitted that the Applicant had taken a total of 82 days of annual leave during her employment. The Respondents contended that the Applicant had wrongly included 5 days in her annual leave calculations, and that she had been overpaid an amount of 2 days in respect of accrued annual leave.
In contrast, the Applicant claimed to have taken 76 days of annual leave during her employment. As I understand it, this, in part, is the basis for the Applicant’s claim to be owed at least 17 hours annual leave.
Ms Murdechayev conceded under cross examination that in her calculations she had in error counted Monday 2 April 2018 and Friday 28 September 2018 as annual leave days taken by the Applicant when in fact these were public holidays. Ms Murdechayev also agreed that Friday 26 April 2019 was an annual leave day taken by the Applicant.
Ms Murdechayev was questioned in relation to the annual leave taken by the Applicant in connection with Jewish holidays. It was common ground that there was an agreement between the Respondents and the Applicant that she would take annual leave during Jewish holidays. The dispute as it emerged before me on this part of the claim in essence came down to how long particular Jewish holiday periods extended for. Ms Murdechayev’s evidence was to the effect that the period known as ‘Sukkot’ extended for 8 - 9 days each year, and the period in question could only be confirmed by reference to a Jewish calendar. A Jewish calendar was subsequently tendered in evidence (exhibit R-9). When that calendar is considered alongside the evidence given by Ms Murdechayev, I am satisfied that the Applicant has not included in her calculations, days of annual leave, taken on 5 and 6 October 2015, 25 October 2016 and 12 and 13 October 2017. These dates fell within the period known as ‘Sukkot’ which are Jewish holidays.
The net result of the evidence above is as follows. First, the clarifications provided by Ms Murdechayev enable me to make a finding that the Applicant took 81 days annual leave during her employment. Second, while the Applicant claims 17 hours of outstanding annual leave, she has not made good that claim. The agreed practice of the parties was that the Applicant take annual leave during Jewish holiday periods. The Applicant’s claim for 17 hours unpaid annual leave cannot be sustained in circumstances where the evidence of Ms Murdechayev and the Jewish calendar demonstrates that the Applicant took 5 days annual leave during her employment that she has not accounted for in her calculations. That remains the case even if one accepts that Ms Murdechayev initially and incorrectly attributed two public holidays as annual leave days. Further, and in any event, if I am wrong in my analysis, the Respondents have paid to the Applicant on a without admissions basis, an amount equal to 17 hours annual leave.
In view of the above matters, I am not prepared to make a finding that the Applicant was owed a payment in respect of accrued untaken annual leave entitlements on termination of employment. This aspect of the claim must be dismissed.
THE ALLEGED CONTRAVENTIONS OF PART 3-6 OF THE ACT (‘THE REGULATIONS CLAIMS’)
Three separate contraventions are alleged by the Applicant under this head of the claim. The First Respondent concedes and admits that it did not provide the Applicant with payslips in contravention of section 536(1) of the Act. Accordingly, it is not necessary to deal with this aspect of claim in any detail. The Applicant also did not press the claimed breach of the requirement to maintain overtime records. The remaining allegations are discussed below.
The Applicant claims that the First Respondent contravened respectively section 535(1) and (2) of the Act by failing to make or keep for seven years employee records of the kind prescribed by the Fair Work Regulations 2009 (‘Regulations’). The Amended Statement of Claim pleads these claims in the following manner:
35.In breach of section 535(1) of the Fair Work Act 2009 (Cth) the First Respondent did not make, or keep for seven years, employee records of the kind prescribed by the regulations in relation to the Applicant.
Particulars
The First Respondent did not make, or keep for seven years, employee records prescribed under regulations 3.32, 3.33, 3.34, 3.36, 3.37 and 3.40.
36.In breach of section 535(2) of the Fair Work Act 2009 (Cth) the First Respondent did not make, or keep for seven years, employee records that included all information prescribed by the regulations in relation to the Applicant.
Particulars
The First Respondent did not make, or keep for seven years, employee records that contained all information prescribed under regulations 3.32, 3.33, 3.34, 3.36, 3.37 and 3.40.
This is a proceeding that has been conducted on the pleadings. The Rules of this Court do not deal with pleadings. Accordingly, the Court may, in a particular case, apply the Federal Court Rules 2011 (‘FCA Rules’) as necessary (see rule 1.05(2) of the Federal Circuit Court Rules 2001). This is a matter which, given the manner in which it has been conducted, I consider it appropriate to apply the Federal Court Rules in respect of pleadings.
The basic function of pleadings is to identify the issues, disclose arguable causes of action and put the other party on notice of the case it has to meet. In Banque Commerciale S.A v Akhil Holdings Ltd (1990) 169 CLR 279 at 286, Mason CJ and Gaudron J said:
The function of pleadings is to state with sufficient clarity the case that must be met: Gould & Birbeck & Bacon v Mt Oxide Mines Ltd (1916) 22 CLR 490 at 517, per Isaacs & Rich JJ. In this way, pleadings serve to ensure the basic requirement of procedural fairness that a party should have the opportunity of meeting the case against him or her and, incidentally, to define the issues for decision.
In Young Investments Group Pty Ltd v Mann (2012) 293 ALR 537 at 540 (‘Young’), a Full Court of the Federal Court stated:
[7]A statement of claim must allege a cause of action with sufficient particularity and not simply make allegations in general terms. The adequacy of a statement of claim is to be assessed by reference to whether the cause of action is pleaded at a level of particularity that is sufficient to define the issues and inform the other party of the case that it has to meet, in the context of the particular allegations. A respondent or defendant is entitled to know the factual foundation for the case that is being alleged, so that the respondent or defendant can prepare to meet that case at trial. In order to disclose a reasonable cause of action, a statement of claim must contain an allegation of all of the relevant facts necessary to support any allegation made in it. A pleading that simply pleads a conclusion is embarrassing and should not be permitted to stand.
Rule 16.02(1)(d) of the FCA Rules relevantly provides that a pleading must state the material facts on which a party relies that are necessary to give the opposing party fair notice of the case to be made against that party at trial. Rule 16.02(2)(d) relevantly provides that a pleading must not be likely to cause prejudice, embarrassment or delay in the proceeding.
As to what constitutes an embarrassing pleading, in Takemoto v Moody’s Investors Service Pty Ltd [2010] FCA 407, Flick J said:
[8]… In Shelton v National Roads and Motorists’ Association Ltd [2004] FCA 1393, (2004) 51 ACSR 278 Tamberlin J discussed the term “embarrassment” and said:
[18] … “Embarrassment” in this context refers to a pleading that is susceptible to various meanings, or contains inconsistent allegations, or in which alternatives are confusingly intermixed, or in which irrelevant allegations are made that tend to increase expense. This is not an exhaustive list of situations in which a pleading may be embarrassing: see Bartlett v Swan Television & Radio Broadcasters Pty Ltd (1995) ATPR 41-434. An example of an embarrassing pleading is where the pleading simply pleads a conclusion. …
See also: Fleet v Royal Society for the Prevention of Cruelty to Animals (NSW) (RSPCA) [2005] NSWSC 926 at [52]; McGuirk v University of New South Wales [2009] NSWSC 1424 at [209]. A pleading will be embarrassing, it has been said, “where it is unintelligible, ambiguous, vague or too general, so as to embarrass the opposite party who does not know what is alleged against him”: Priest v New South Wales [2006] NSWSC 12 at [34].
Turning then to the present matter, a number of issues become apparent when the pleaded claims are assessed in light of the principles in the authorities above. First, the Applicant has not pleaded material facts. Second, what the Applicant has pleaded may be fairly described as ‘simply pleading a conclusion’ as the Full Court put it in Young. Third, by referring to all of the regulations in the particulars without distinction or difference, the Applicant has produced a pleading that is embarrassing with ‘alternatives [that] are confusingly intermixed’. Fourth, by preparing the pleading in this way, the Respondents have, in my view, been denied the opportunity to lead an evidentiary defence in respect of some or all of the claims.
The Applicant attempted to cure this in closing submissions (in the document handed up and entitled ‘Applicant’s chronology of events for closing submissions’) in two ways. First, it was submitted that the Respondents did not plead that they did create and maintain the relevant records. This is not, in my view, an answer to the deficiencies identified. The obligation was on the Applicant to plead the claim in a manner consistent with the principles articulated above and with the FCA Rules. They have not done so. Second, the Applicant submitted, among other things, that the Respondents did not keep records that specified a range of matters found in the Regulations. For example, the Applicant submitted the Respondents did not keep records that specified a business name, the Applicant’s name, that her position was full-time, that her position was permanent, or the gross and net amounts paid to the Applicant. There are three things to be said about these submissions. First, to the extent these submissions or claims were made, they ought to have been set out in the Amended Statement of Claim. Second, the identification of these matters came very late in the piece – during closing submissions after all of the evidence closed. Third, there is a lack of evidence in support of these matters and the absence of any pleaded facts means it is not open to this Court to make a finding in the absence of such facts.
When all of the above is considered, these claims should be dismissed. A cause of action has not been properly pleaded consistent with the principles I have articulated above, or in compliance with the FCA Rules. The Respondents have been denied the opportunity to meet the case at trial and have not been afforded procedural fairness.
ALLEGED CONTRAVENTIONS OF THE GENERAL RETAIL INDUSTRY AWARD (‘THE AWARD CLAIMS’)
It is agreed that the Award covered and applied to the Applicant’s employment with the First Respondent. Further, the First Respondent admitted that it failed to notify the Applicant in writing of her classification under the Award in contravention of clause 16.1 of the Award, and that it failed to pay the Applicant annual leave loading during her employment in contravention of clause 32.3 of the Award (although it took steps post her employment to rectify the breach). The Applicant also did not press the claimed breached of clauses 22.2 and 29.9 of the Award, which related to payment of overtime hours and superannuation contributions. The remaining alleged contraventions which were pressed by the Applicant in closing submissions are dealt with below.
The Applicant claimed that the First Respondent had failed to ensure that copies of the Award and the National Employment Standards (‘NES’) were made available to her in contravention of clause 5 of the Award. The First Respondent submits that no contravention has been made out on the basis that the Applicant was provided access to a computer and an internet connection through which the Award and the NES could be accessed. I am satisfied that the Applicant was provided with a computer and internet connection. The relevant question is whether the mere provision of those items is sufficient to meet the obligation contained in clause 5 of the Award.
Clause 5 of the Award is in the following terms:
5. Access to the award and the National Employment Standards
The employer must ensure that copies of this award and the NES are easily available to all employees to whom they apply either on a noticeboard or other prominent location which is conveniently located at or near the workplace or through electronic means, whichever makes them more accessible.
Clause 5 of the Award places an obligation on an employer to ensure that copies of the Award and the NES are available to an employee. The emphasis of the provision is not simply on access to these documents. Rather, the obligation on the employer is to make those documents ‘easily available’. Moreover, the language in the clause is directed toward the employer taking steps to bring to the attention of the employee the Award and the NES. So much may be seen by the use of the words ‘easily available’, ‘prominent location’ and ‘conveniently located at or near the workplace’.
I am unable to accept the proposition that simply providing an employee with a computer and an internet connection, without more, is sufficient to satisfy clause 5. I accept that a knowledgeable employee may be able to use an internet search engine to search the award name and through tracking the results produced by the search engine, potentially find the applicable award on the Fair Work Commission website, or elsewhere. However, that situation carries with it various assumptions. It assumes that the employee has been informed of the award that is applicable to their employment. It assumes the employee is sufficiently proficient in the use of computers and in the use of the English language (with the ability to spell correctly assuming particular importance). It also assumes that the employee will be taken easily and directly to the most up-to-date version of the award, and not some historical version which experience indicates a person may be directed to when using a search engine.
In my view, when the above matters are considered, it becomes clear that simply providing a computer and an internet connection is not sufficient to satisfy clause 5 of the Award. Clause 5 requires an employer to make the Award easily available and to bring it to the attention of the employee by placing the Award and the NES in a prominent location. In a physical environment, the usual place to locate the Award and the NES would be on a notice board, or in a common area such as a tea or lunch room. In the electronic environment, it would require the employer to ensure that a copy of the Award and the NES were placed on an electronic noticeboard or intranet page maintained by the employer, or on a clearly identified and marked hard drive or server. Were this not the case, the mere fact that an employee has access to a smart phone with an internet connection would be sufficient to discharge the obligation. I consider that to be inconsistent with both the text of, and the purpose behind, clause 5.
Accordingly, I am satisfied that the First Respondent has contravened clause 5 of the Award and section 45(1) of the Act.
The Applicant also claims that the First Respondent has contravened clause 23.4 of the Award and section 45(1) of the Act by failing to pay to the Applicant all amounts that were due to the Applicant under the Award and the NES within seven days after the date of her termination of employment.
Clause 23.4 of the Award relevantly provides as follows:
23.4 Payment on termination of employment
(a) The employer must pay an employee no later than 7 days after the day on which the employee’s employment terminates:
(i)the employee’s wages under this award for any complete or incomplete pay period up to the end of the day of termination; and
(ii)all other amounts that are due to the employee under this award and the NES.
(b)The requirement to pay wages and other amounts under paragraph (a) is subject to further order of the Commission and the employer making deductions authorised by this award or the Act.
I am satisfied that the First Respondent has contravened clause 23.4 of the Award and section 45(1) of the Act for the reasons articulated earlier, by failing to make a payment in lieu of notice. The First Respondent has not, however, contravened clause 23.4 of the Award by failing to pay accrued untaken annual leave entitlements the reasons set out earlier.
SUMMARY OF FINDINGS AGAINST THE FIRST RESPONDENT
Having regard to what I have set out above, I am satisfied that the First Respondent has:
(a)contravened section 340(1)(a)(iii) of the Act by dismissing the Applicant from employment for the reason that the Applicant proposed to exercise her workplace rights to take annual leave and personal leave;
(b)contravened sections 44(1) and 117(2) of the Act by failing to provide the Applicant with four weeks written notice of termination, or payment in lieu of notice of termination;
(c)contravened section 536(1) of the Act by failing to give the Applicant a payslip within one working day of paying an amount to the Applicant in relation to the performance of work at any time during her employment;
(d)contravened clause 5 of the Award and section 45(1) of the Act by failing to ensure that copies of the Award and the NES were available to the Applicant either on a noticeboard or prominent locations which was conveniently located at or near the workplace, or through electronic means, whichever is more accessible;
(e)contravened clause 16.1 of the Award and section 45(1) of the Act by failing to advise the Applicant in writing of her classification or of any change to her classification under the Award
(f)contravened clause 23.4 of the Award and section 45(1) of the Act by failing to pay to the Applicant all amounts due to her under the Award and the NES within seven days after the dismissal being her payment in lieu of notice;
(g)contravened clause 32.3 of the Award and section 45(1) of the Act by failing to pay the Applicant annual leave loading during her employment
ACCESSORIAL LIABILITY OF THE SECOND RESPONDENT
The Applicant claims that the Second Respondent was involved in each of the contraventions of the First Respondent pursuant to section 550 of the Act. The Respondents accepted that the claim that the Second Respondent was involved in the adverse action taken by the First Respondent had been pleaded in a manner that allowed the Second Respondent to properly respond to the claims. However, the Respondents took issue with the manner in which the Applicant had pleaded the remaining claims that the Second Respondent was involved in the other contraventions committed by the First Respondent. In this respect, it was submitted, inter alia, that no act or omission had been pleaded, no un-pleaded act or omission engaged in by the Second Respondent was established, and no actual knowledge had been established. On this basis, it was submitted that the claims against the Second Respondent arising from contraventions by the First Respondent (other than the adverse action claim) should be dismissed.
I have earlier in these reasons attempted to summarise the principles relating to pleadings. To those may be added the following. A claim against a person that he or she is liable as an accessory is a serious one and is like that of an accessory in criminal proceedings: see Batten v CTMS [1999] FCA 1576 at [28] per Kiefel J (as she then was). A person faced with such a claim is, inter alia, entitled to be apprised not only of the legal nature of the offence with which he is charged, but also of the particular act, matter or thing alleged as the foundation of the charge: King v R (1986) 161 CLR 423, 425-426 (‘King v R’). The principles in relation to the operation of section 550 of the Act have recently been conveniently summarised by a Full Court of the Federal Court of Australia in EZY Accounting 123 Pty Ltd v Fair Work Ombudsman [2018] FCAFC 134 (Flick, Bromberg and O’Callaghan JJ) (‘EZY Accounting’) at [10]-[15].
I deal firstly with the claims that the Second Respondent was involved in contraventions committed by the First Respondent, other than the contravention by the First Respondent of section 340 of the Act. The claim against the Second Respondent is that he was knowingly concerned in these contraventions as contemplated by section 550(2)(c) of the Act. The Applicant has pleaded that the Second Respondent was knowingly concerned given ‘he had actual knowledge of the essential facts constituting the contraventions, was the sole director, secretary and shareholder of the First Respondent and was the person responsible for the terms of the Applicant’s employment with the First Respondent’ (paragraphs [55] and [56] of the Amended Statement of Claim). The Applicant has further pleaded in relation to the contravention of Part 2-1 that the Second Respondent ‘made the decision not to pay the Applicant her notice and annual leave entitlements and communicated these decisions to the Applicant’ (paragraphs [33]-[34] of the Amended Statement of Claim).
There are two immediate observations about the pleading at paragraph [55]-[56] of the Amended Statement of Claim. First, no ‘act or omission’ is pleaded. The pleading falls short of the standards identified and required when one has regard to the statements made in cases such as King v R. The second observation which flows directly from the first is that the failure to plead the act or omission has operated to deny the Second Respondent the opportunity to know what the act or omission is, and whether he can meet it.
A review of the evidence in the matter discloses further issues with this aspect of the claim. The evidence of the Second Respondent, which I accept, was that he was concerned with the operational aspects of the business being diamonds and rings. He was a person who did not have the capacity to read or understand written English. He did not know the Award existed. The evidence is, and I accept, that the Second Respondent relied on other persons when it came to the processing of pay and entitlements. The evidence, such as it is, establishes that employees were to keep their own time records and to forward them to Mr Sheppard. Mr Sheppard then calculated the entitlements of employees, including the Applicant, in accordance with the information provided by the employees themselves. The evidence also establishes that the Second Respondent relied on Ms Murdechayev to assist him to check or verify amounts claimed or outstanding. The Second Respondent was never provided with the spreadsheet of entitlements passing between Mr Sheppard and the Applicant.
Perhaps aware of the above, the Applicant made a submission in closing (which appears in a document titled ‘Applicant’s chronology of events for closing submissions’ provided to the Court on 26 February 2021) that the Second Respondent was ultimately responsible for the ‘work systems’ within the First Respondent. There appears to me to be several difficulties with that submission. Firstly, it runs contrary to the evidence. The Second Respondent may well have been involved in aspects of the business such as making sales, ordering diamonds and overseeing marketing, but the evidence is also that he relied on others, most notably Mr Sheppard and Ms Murdechayev, to deal with employment matters such as payments to employees and records of such payments. Second, it was a point that was only raised in closing submissions. It was not raised previously and certainly does not feature in the Amended Statement of Claim. As such, the Respondents have not had any opportunity to meet that submission or argument by way of evidence.
In short, when the above matters are considered, I am not satisfied that the Second Respondent was involved in contravening section 536(1) of the Act in relation to the failure to provide payslips, clause 5 and section 45(1) of the Act by failing to ensure the Award and the NES were made available, clause 16.1 of the Award and section 45(1) of the Act by failing to advise the Applicant of her classification, or a change to the classification and clause 32.3 of the Award and section 45(1) of the Act by failing to pay the Applicant annual leave loading during her employment. The Applicant has not been able to identify conduct of the Second Respondent which implicates him in the contraventions referred to above such that it can be said he is ‘involved in’ the conduct within the meaning of section 550 of the Act.
There is then the claim that the Second Respondent was involved in the contravention by the First Respondent of section 340(1)(a)(iii). In my view, the Second Respondent was involved in these contraventions of the Act by the First Respondent. The Second Respondent was the sole director and shareholder of the First Respondent. He employed the Applicant. He had the power to end her employment The Applicant reported to him and worked alongside him in the business. It was to the Second Respondent that the Applicant first reported her diagnosis and he was the one who directly expressed concerns about her predicament and the impact on the business on 17 and 18 April 2019. More significantly, however, it was the Second Respondent that was directly involved in the conversation with the Applicant on 8 May 2019 which led to the termination of her employment. He had the power to end her employment and he did so personally on that date. I have made findings earlier in relation to the Second Respondent’s conduct during that discussion and rely on those findings. Furthermore, the Second Respondent signed the Certificate knowing it dealt with ‘separation’ from employment, and also instructed Ms Murdechayev in relation to the job advertisement which was placed on Seek.
When these matters are considered, I find that the Second Respondent engaged directly in the acts that are set out above and was involved in the placement of the advertisement on Seek. By engaging in this way, he was knowingly concerned in the dismissal of the Applicant from her employment and, as I have noted above, he dismissed her because she was proposing to exercise her workplace rights to take annual leave or personal leave. For all of the reasons set out above, I find that the Second Respondent was involved in the contraventions of section 340 of the Act committed by the First Respondent and has therefore contravened section 550(1) of the Act.
There is finally the claim by the Applicant that the Second Respondent contravened section 550(1) of the Act on the basis that he was involved in the decision not to pay the Applicant payment in lieu of notice. The Applicant claims in the Amended Statement of Claim that it was the Second Respondent who made the decision not to pay the Applicant a payment in lieu of notice. There is nothing in the evidence, however, which sheds any light on any decision to make a payment in lieu of notice or how any decision came to be made.
It seems to me that at its highest, the Applicant’s claim that the Second Respondent was involved in the First Respondent’s failure to pay the Applicant her payment in lieu of notice, is based on the following. First, the Second Respondent was the sole director and shareholder of the business. Second, the Second Respondent had the power to dismiss the Applicant from employment. Third, the Second Respondent in fact made the decision to dismiss the Applicant from employment and did so during the conversation between the parties on 8 May 2019. Fourth, the Applicant never received a payment in lieu of notice.
While on one level it may be considered open to draw a conclusion that the Second Respondent was involved in the First Respondent’s failure to make a payment in lieu of notice, I would not draw such a conclusion in this case. The unchallenged evidence in this case is that payments of employee entitlements were handled by Mr Sheppard. The Second Respondent simply was not involved in calculating or making payments to employees, although I acknowledge he kept a record of them. Further, there is no evidence the Second Respondent turned his mind to the question of notice or payment in lieu of notice. For these reasons, I find that the Second Respondent was not involved in the contraventions by the First Respondent relating to the failure by the First Respondent to make a payment in lieu of notice.
CONCLUSION
As I have found that the First Respondent has contravened certain sections of the Act and breached clauses of the Award, and the Second Respondent was involved in some of these contraventions, there will be declarations made accordingly.
The question of compensation and penalties remains to be resolved. The parties are directed to submit to chambers within 21 days a minute of consent orders which contain directions for the filing of material on the question of compensation and penalties. The parties when submitting that minute should also advise the Court as to their estimate of how long any hearing on compensation and penalty is expected to take.
I certify that the preceding one hundred and forty-seven (147) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Blake. Associate:
Dated: 21 June 2021
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