Todd Hutchinson v National Aboriginal Solutions (Aboriginal Corporation)

[2015] FWC 5103

[2015] FWC 5103

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Todd Hutchinson
v
National Aboriginal Solutions (Aboriginal Corporation)
(U2015/3705)

SENIOR DEPUTY PRESIDENT O’CALLAGHAN ADELAIDE, 3 AUGUST 2015

Application for relief from unfair dismissal – no valid reason – unfair process – compensation – remuneration that the employee would have received, or would have been likely to receive.

[1] This decision deals with the merits of the unfair dismissal application made by Mr Hutchinson on 5 March 2015. In that application Mr Hutchinson asserts that the termination of his employment with National Aboriginal Solutions (Aboriginal Corporation) (referred to as NAS) was unfair. In a decision 1 issued on 17 June 2015 I stated:

“[30] I have concluded that Mr Hutchinson was an employee before 12 February 2015 and that he was summarily dismissed on that day. He was a person who was protected from unfair dismissal. Accordingly, I am not satisfied that he is prevented from pursuing this application because of a volunteering arrangement, or a redundancy or the Small Business Fair Dismissal Code. His application was lodged within the statutory time limit. Accordingly, Mr Hutchinson is able to pursue this application. An Order (PR568359) to this effect will be issued.”

[2] As a consequence of that decision (the jurisdictional matters decision), the application was listed for consideration of the merits through a determinative conference, on 21 July 2015. In this conference, Mr Hutchinson represented himself and Mr Keily, the Chief Executive Officer of NAS represented NAS. Directions requiring the provision and exchange of any further witness statements relative to the merits of the matter and any other document upon which a party intended to rely were issued on 18 June 2015, but no further material was provided to me.

[3] In the jurisdictional matters decision I expressed substantial reservations about the credibility of both Mr Hutchinson and Mr Keily. The conference held on 21 July 2015 at which the merits of the application were considered, has further exacerbated my concerns as to the credibility of both parties. It is also appropriate that I note that, at the commencement of the conference on 21 July 2015 I confirmed to the parties that at least some of the matters for consideration could give rise to proceedings in other jurisdictions such that both Mr Hutchinson and Mr Keily were cautioned that advice provided to me was a matter of public record.

[4] Both Mr Hutchinson and Mr Keily agreed that I should rely on the material before me in the jurisdictional matters decision so as to form a conclusion relative to the merits of the application. Notwithstanding that, Mr Keily advised that he considered that he had not represented himself appropriately in the earlier matter. I have taken this submission to indicate that NAS maintained its position relative to the majority of the various matters considered in the jurisdictional matters decision.

[5] I have summarised the background to this matter on the basis of the material before me. Mr Hutchinson was employed by NAS in September 2012. From October 2013 he was engaged under an employment contract 2 which specified that he had the position of “Nation Project Development Manager-National Aboriginal Solutions (Aboriginal Corporation). This contract specified the duties required of him and a salary of $75,000 per annum. In addition, superannuation and various incidental payment arrangements were prescribed. NAS advises that it is currently registered as a public benevolent institution and as a small charity under the Australian Charities and Not for Profit Commission Register. It advises that it is also listed with the Office of the Registrar of Indigenous Corporations as a small not for profit business. Mr Keily advises that he is in the process of de-registering NAS in this respect.

[6] Mr Hutchinson’s evidence was that, notwithstanding the provisions for payment of the salary specified in his employment contract he did not receive any form of regular payments from NAS and that he was promised payment when funding and/or commercial partners for NAS were obtained. Mr Hutchinson advised that he was paid a total of approximately $3000 over the duration of his employment, and that, with the exception of one cash payment of $1000, these payments were made in small irregular cash payments. No evidence relative to the payments made to Mr Hutchinson was provided to me by either party. Both parties had the opportunity to provide evidence of payments made to Mr Hutchinson. Notwithstanding this, the parties agree that, from late 2013, Mr Hutchinson lived with Mr Keily’s family.

[7] Mr Hutchinson and Mr Keily continue to disagree over the reasons for and background to the termination of Mr Hutchinson’s employment. In my decision of 17 June 2015 I set out the reasons for my conclusion that Mr Hutchinson was dismissed by Mr Keily on 12 February 2015 following an altercation. It is not necessary that I repeat those reasons.

[8] Whilst both Mr Keily and Mr Hutchinson elected not to provide any further material in support of their respective positions, at my invitation, they both made submissions about the provisions of ss.387 and 392 of the FW Act. I have considered these submissions in the context of the evidence presented in the jurisdictional matter.

[9] Section 387 states:

“387 Criteria for considering harshness etc.

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

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

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

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

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

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

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

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

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

[10] Mr Hutchinson’s position was that there was no valid reason for the termination of his employment and that the manner in which that occurred was unfair. Mr Keily advised that there was valid reason for the termination of Mr Hutchinson’s employment. However, he made that submission in the context of his continuing assertion that Mr Hutchinson abandoned his employment following the altercation with him. Mr Keily confirmed that no reason for termination was given to Mr Hutchinson and that Mr Hutchinson was not given an opportunity to respond to the termination proposal. The issue of access to a support person did not therefore arise. In terms of Mr Hutchinson’s performance, Mr Keily advised that he had a discussion, at some point, with Mr Hutchinson about the extent to which he had been sleeping most of the day, but he did not consider this to be a warning. Mr Keily confirmed that NAS is a small business with no human resource management resources or access. Finally, Mr Keily referred to Court action being pursued by Mr Hutchinson through which he was seeking to recover monies asserted to be payable under the terms of the employment contract. Mr Keily suggested that this Court action was relevant to the unfair dismissal application.

[11] Neither Mr Hutchinson’s nor Mr Keily’s submissions were of significant assistance relative to s.387. However, the evidence before me from the jurisdictional matters conference confirms that the termination of Mr Hutchinson’s employment followed an altercation between the two men but this altercation did not represent a valid reason for the termination of Mr Hutchinson’s employment. It was an altercation which I consider was as much, if not more the consequence of Mr Keily’s behaviour, than it was Mr Hutchinson’s. Notwithstanding my conclusion that both Mr Hutchinson and Mr Keily lack credibility in terms of the evidence, I tend to prefer the evidence of Mr Hutchinson to the effect that:

“83. This Disagreement began to elevate the conversation and it became a little heated:

….

h. Paul said, “And this shit with John and Red Centre Enterprises owing him all this money – taking a shareholding for nothing is bullshit. All he’s done is to introduce us to these funding guys who are just agents. I can get anyone to do that shit, I’m not having this shit go on. I’m sick of John pulling this bullshit.”

i. Paul said, “I’m sick of this, you and John. It’s all about money for you. This is supposed to be for Black Fellas to take ownership over.”

j. I said, “That’s absolute crap. This has never been about money for me. You know that!”

k. I said, “What, so you’re kicking me off of Certified Australian Native? That’s bullshit man. I worked my arse off on Certified Australian Native and I don’t see anyone else getting off their arse to get it happening.”

l. Paul said, “There you go –Lazy Black Fellas – is that right Todd?”

m. I said, “That’s shit mate. Don’t you put words in my mouth! I didn’t say that – I said I don’t see anyone helping to get this done on time, I’ve never met these Aboriginal People out in communities you’re talking about Paul. You’ve never taken me to meet them like you said you would and I don’t see them working on Certified Australian Native.”

n. Paul said, “That’s it man. I’m not having you working on this anymore. Go and do your own thing Todd. Go and make your $300 an hour doing design or whatever it is you reckon!”

o. I said, “That’s bullshit. This isn’t about money for me. You know that Paul!”

p. Paul said, “Yes it is. That’s what you and John and everyone else is all about Todd; money. That’s it. I’m not having this anymore. When we get back you can pack your shit and go. I’m not having you working for the company anymore.”

q. I said, “What do you mean, on Certified Australian Native?”

r. Paul said, “Certified Australian Native, Red Centre Enterprises and NAS. All of it. You are not working for me anymore. When we get back you can pack your shit, I’ll drop you back to your mum’s and you can go and do your own thing. Go and earn your three hundred bucks an hour doing your own thing. You’re not working for NAS any longer.”

s. I said, “You know what Paul? I have never been so disrespected in my fucking life! That’s bullshit man. This has never been about money for me – it’s never been about owning shit either. I never wanted to own anything in my fucking life!”

t. I said, “You know what? I’m starting to think this is all just bullshit man. I’m starting to think I’m just a mark for you.”

u. Paul said, “What’s that supposed to mean Todd?”

v. I said, “I’m just a mark in this dirty little scam that you and Nadia have got going! That’s all this is to you! I’m just a mark in your scam!”

w. Paul said, “What scam Todd? I don’t know what you are talking about!”

x. I replied “Bullshit man. You know exactly what I am talking about! The Rise Initiative shit you and Nadia have got going.”

y. Paul said, “What scam Todd? It’s not a scam. You knew about the Rise Initiative when you started here.”

z. I said, “Yeah that’s it right! I got the letters from WorkCover about Rise being over. So what now that the money dried up you just kick me to the curb? I have never been so disrespected in my fucking life as I have by you and Nadia. I was just a pawn in your fucking fraud to scam money off the WorkCover system!”

aa. Paul said, “Right that’s it. You talk to Nadia like that when we get back see where that gets you!”

bb. I said, “I fucking will. I’m sick of you two using me. Nothing but a mark in some bullshit scam! What the fuck did you do with all that money you two have been scamming off of WorkCover? Why the fuck hasn’t it been put back into the business? You two just use it for whatever you fucking want to. Meanwhile we’re fucking struggling trying to make this business happen!”

cc. Paul said, “That’s it Todd. You talk to Nadia like that when we get back she’ll tell you what!”

dd. I said, “I don’t give a fuck Paul. I fucking will talk to her about it! I have never been so disrespected in my fucking life!”

ee. Paul said, “You’ve never been so disrespected in your life? Well you mustn’t have had a lot of respect before then!”

ff. I said, “Nah I haven’t actually. Where I’m from people pay each other respect and keep their fucking word. Something you wouldn’t know anything about! You have never kept your word in your fucking life!”

84. Approximately twenty minutes into the car trip back to Paul’s residence I said, “You’d better pull over and let me have a smoke please.”

85. After stopping on the side of the road just south of Woodside for a cigarette each, we both returned to the car and did not speak much else for the rest of the trip home, except about ten minutes from our destination just north of Kersbrook.

86. Paul spoke to me stating, “You go ahead and talk to Nadia about this when we get back see what she has to tell you.” I replied, “don’t you worry I will.” Paul reiterated that I was no longer an employee of the organisation saying, “you’ve done your dash mate – you don’t work for me anymore. You can pack you shit when we get back and I’ll give you a lift back to your mum’s, and you can go and do your own thing – don’t bother trying to get in touch with any of NAS’s or Red Centre Enterprises’ contacts. You don’t work for NAS anymore.” 3

[12] Mr Hutchinson was not told of the reason for his dismissal. He was not given an opportunity to respond to that reason and the manner of the dismissal meant that there was no opportunity for him to request or access a support person. I accept that Mr Hutchinson may have been spoken to for sleeping during the day but, given the unusual nature of the employment relationship, I do not regard this as a warning.

[13] NAS is a very small business and I accept that it had neither Human Resource Management resources, or access to those resources.

[14] In terms of other matters considered relevant, I have not taken the court action currently proceeding into account as that matter has not been determined and in any event, I do not regard it as relevant to the employment termination.

[15] I have concluded that the termination of Mr Hutchinson’s employment was harsh in that there was no valid reason for it. It was unjust in that it resulted from a dispute over the method of operation of NAS. It was unreasonable in terms of the manner in which it occurred. Consequently, it was unfair.

[16] Section 390 of the FW Act establishes that in these circumstances the Fair Work Commission can determine a remedy. The primary remedy is that of reinstatement. Neither Mr Hutchinson nor Mr Keily consider that reinstatement is appropriate. Given the relationship between the two men, and the circumstances of the dismissal, I do not consider reinstatement to be appropriate.

[17] The nature of Mr Hutchinson’s dismissal supports an award of compensation. However, any award of compensation must be calculated consistent with s.392 of the FW Act which states:

“392 Remedy—compensation

Compensation

(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

Criteria for deciding amounts

(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

(a) the effect of the order on the viability of the employer’s enterprise; and

(b) the length of the person’s service with the employer; and

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

(g) any other matter that the FWC considers relevant.

Misconduct reduces amount

(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

Shock, distress etc. disregarded

(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.

Compensation cap

(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

(a) the amount worked out under subsection (6); and

(b) half the amount of the high income threshold immediately before the dismissal.

Note: subsection 392(5) indexed to $66,500 from 1 July 2014

(6) The amount is the total of the following amounts:

(a) the total amount of remuneration:

(i) received by the person; or

(ii) to which the person was entitled;

(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and

(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.”

[18] I have taken each of these factors into account.

[19] Mr Keily advises that the NAS bank account has only a few dollars in it and that he is in the process of winding up NAS. He advised that he had divested his shareholding in another company structure, intended to operate in tandem with NAS but on a “for profit” basis. No evidence supporting these submissions was provided to me. I have adopted the position that Mr Keily’s advice that NAS was a financial failure should be accepted because it appears consistent with the manner in which he provided evidence.

[20] Had Mr Hutchinson not been dismissed I think it more likely than not that he would have eventually left NAS because of the limited payments being made to him, his concern over the extent to which the NAS focus appeared to be on gaining a financial benefit and his study objectives. At most, I consider that Mr Hutchinson may have remained with NAS for a further six months. There is absolutely nothing to indicate that, over that time Mr Hutchinson would have been paid more that the periodic small payments made to him which I have assessed as equating to $60 per week without including the value of accommodation. I am not satisfied that the rate specified in the employment agreement represents an appropriate basis for this calculation because Mr Hutchinson would not have received that amount or would not have been likely to have received it. Whilst Mr Hutchinson was provided with board and lodging at Mr Keily’s home I do not consider this arrangement would have continued after 12 February 2015, even if Mr Hutchinson had remained in employment after that date. I consider that the nature of the argument between Mr Hutchinson and Mr Keily would have precluded that accommodation arrangement from continuing. Consequently, I have not included any accommodation component in my calculation of the compensation amount.

[21] Mr Hutchinson advised that since the termination of his employment he has returned to full time study. He also undertook limited duration casual work through which he earned $2877. I have not taken the Centrelink and Austudy payments received by him into account. I have concluded that Mr Hutchinson has not actively pursued full time work because he elected to return to full time study.

[22] I do not think that the NAS situation would have changed over the period in question such that any further, or additional payments, would have been made to Mr Hutchinson or that Mr Hutchinson is likely to earn any additional income over the period in question.

[23] Again, I have not taken the impending Court action into account in considering compensation. The outcome of that matter is not yet known and I am not persuaded that the matter involves an assessment of remuneration in lieu of reinstatement.

[24] I have applied the general approach adopted in Sprigg v Paul’s Licensed Festival Supermarkets⁴.

[25] I have concluded that the amount that Mr Hutchinson would have received would total six month’s pay at $60 per week. Had it not been the case that this amount is less than the income subsequently earned by Mr Hutchinson, I would have further reduced it. I do not consider that any further amount can be awarded in the particular circumstances of this matter.

[26] As a consequence of this conclusion no Order for payment of compensation will be issued.

Appearances:

T Hutchinson on his own behalf.

P Keily for the respondent.

Hearing (Determinative Conference) details:

2015.

Adelaide:

July, 21.

 1   [2015] FWC 4021

 2   Exhibit A2, Attachment D

 3   Exhibit A2, paras 83 - 86

4 AIRC, Print R0235, (24 December 1998)

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