Turley v James Frizelles Automotive Group
[2018] FCCA 2989
•30 October 2018
FEDERAL CIRCUIT COURT OF AUSTRALIA
| TURLEY v JAMES FRIZELLES AUTOMOTIVE GROUP | [2018] FCCA 2989 |
| Catchwords: INDUSTRIAL LAW – Application pursuant to s.545 of the Fair Work Act2009 (Cth) – where the applicant alleged the respondent contravened s.340 of the Fair Work Act2009 (Cth) by taking adverse action against him for exercising or proposing to exercise a workplace right – where the respondent denies such a contravention – where the Court found the respondent did not take adverse action against the applicant for exercising a workplace right – where the applicant alleged the respondent contravened s.352 of the Fair Work Act 2009 (Cth) by dismissing the applicant because he was temporarily absent from work because of illness or injury – where the respondent denies such a contravention – where the Court found the applicant’s claim was not made out – where the applicant claims the respondent failed to pay the applicant “in full” for the purposes of s.323 of the Fair Work Act2009 (Cth) by wrongly deducting superannuation from commission. |
| Legislation: Fair Work Act 2009 (Cth), ss.12, 323, 324, 340, 341, 342, 352, 361, 545 |
| Cases cited: Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500 Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2014] HCA 41; (2014) 253 CLR 243 Construction, Forestry, Mining and Energy Union v Clermont Coal Pty Ltd [2015] FCA 1014; (2015) 253 IR 166 Construction, Forestry, Mining and Energy Union v De Martin & Gasparini Pty Limited (No.2) [2017] FCA 1046; (2017) 69 AILR 102-860 Fortune Holding Group Pty Ltd v Zhang [2016] VSC 273 Henry v Leighton Admin Services Pty Ltd & Anor [2015] FCCA 1923; (2015) 299 FLR 342 Ratnayake v Greenwood Manor Pty Ltd [2012] FMCA 350 Shea v TRUenergy Services Pty Ltd (No.6) [2014] FCA 271; (2014) 314 ALR 346; (2014) 242 IR 1 Tjorpatzis v E J Love & Co Pty Ltd & Anor [2016] FCCA 2735 |
| Applicant: | STEVEN TURLEY |
| Respondent: | JAMES FRIZELLES AUTOMOTIVE GROUP |
| File Number: | BRG 834 of 2017 |
| Judgment of: | Judge Harper |
| Hearing date: | 6 June 2018 |
| Date of Last Submission: | 6 June 2018 |
| Delivered at: | Sydney |
| Delivered on: | 30 October 2018 |
REPRESENTATION
| The Applicant appeared in person |
| Solicitor Advocate for the Respondent: | Fraser Perrin |
ORDERS
The applicant’s claims for relief be dismissed.
If any party seeks an order for costs, an appropriate application to the Court may be made within 28 days of today’s date (supported by any documentary material) to be filed and served within that time period and a copy forwarded to my Chambers. If no such application is made within the time period specified, no order will be made as to costs.
THE COURT NOTES THAT:
Any application as to costs will be dealt with by way of written submissions, unless the parties request to be heard orally.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRG 834 of 2017
| STEVEN TURLEY |
Applicant
And
| JAMES FRIZELLES AUTOMOTIVE GROUP |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an application pursuant to s.545 of the Fair Work Act 2009 (Cth) (“the Fair Work Act”) for orders in relation to the employment of the applicant, Steven Turley (“the applicant”).
The applicant was employed by the respondent, James Frizelles Automotive Group (“the respondent”), as a Finance & Insurance Business Manager, starting 30 May 2016.
The applicant’s employment was terminated on 24 May 2017.
The applicant seeks compensation under s.545 of the Fair Work Act (supra) alleging the respondent contravened two civil penalty provisions of that Act as follows: (i) s.340, by taking adverse action against the applicant because he exercised or proposed to exercise a workplace right; and (ii) s.352 by dismissing the applicant because he was temporarily absent from work because of illness or injury.
For the purposes of s.340 of the Fair Work Act (supra), the applicant relies upon five written or verbal complaints as detailed later in these reasons, and contact with the Fair Work Ombudsman (“FWO”), also detailed later in these reasons.
The applicant also makes a claim that he was dismissed because of a temporary absence for illness in contravention of s.352 of the Fair Work Act (supra).
The applicant makes an entirely separate claim relating to superannuation payable on his behalf and calculated on his commissions.
Procedural history
The applicant filed his Originating Application on 25 August 2017.
The respondent filed their Response on 22 September 2017.
The matter first came before his Honour Judge Jarrett on 25 September 2017. On this occasion, directions were made for the applicant to file a Statement of Claim and the respondent to file a Defence.
On 9 October 2017, the applicant filed a Statement of Claim.
On 31 October 2017, the respondent filed a Defence.
On 6 November 2017, the applicant filed a Reply to the respondent’s Defence.
On 29 January 2018, Jarrett J made orders listing the matter for final hearing on 29 May 2018 for no more than two days, and directions for preparation for final hearing.
Due to changes in the judicial calendar, the matter was listed before me for final hearing on 6 & 7 June 2018 in Brisbane.
Material relied upon
The applicant relied on the following:
a)His Affidavit affirmed and filed 13 November 2017 (“November affidavit”); and
b)His Affidavit affirmed and filed 18 December 2017 (“December affidavit”).
The respondent relied on the following:
a)Affidavit of Robert Lee Bradbury (“Mr Bradbury”) sworn and filed 11 December 2017;
b)Affidavit of Megan Maree McKenzie (“Ms McKenzie”) sworn and filed 11 December 2017;
c)Affidavit of Michael Wolodymer Schapowal (“Mr Schapowal”) sworn and filed 11 December 2017; and
d)Affidavit of Mita Hikairoa Jan Borell (“Mr Borell”) sworn and filed 11 December 2017.
Witnesses
Generally, I formed the view that all witnesses gave frank evidence to the best of their recollection. However, the applicant manifested a tendency to advocate his case in the witness box, and his answers were coloured often by a strong sense of victimhood.
Employment Contract
The applicant commenced employment as a finance and insurance business manager on 30 May 2016 with the respondent. His terms of employment were set forth in a letter of offer dated 17 May 2016 (“Employment Contract”). I will refer to relevant parts of this contract later in these reasons.
Award
It was common ground that the applicant’s employment was also covered by the Vehicle Manufacturing, Repair, Services and Retail Award (“the Award”) and that the Award was a “workplace instrument” as defined in the Fair Work Act (supra). For the purposes of this judgment, clauses 8 and 9 of the Award are important.
Clause 8 is in the following terms:
8.1 Consultation regarding major workplace change
(a) Employer to notify
(i) Where an employer has made a definite decision to introduce major changes in production, program, organisation, structure or technology that are likely to have significant effects on employees, the employer must notify the employees who may be affected by the proposed changes and their representatives, if any.
(ii) Significant effects include termination of employment; major changes in the composition, operation or size of the employer’s workforce or in the skills required; the elimination or diminution of job opportunities, promotion opportunities or job tenure; the alteration of hours of work; the need for retraining or transfer of employees to other work or locations; and the restructuring of jobs. Provided that where this award makes provision for alteration of any of these matters an alteration is deemed not to have significant effect.
(b) Employer to discuss change
(i) The employer must discuss with the employees affected and their representatives, if any, the introduction of the changes referred to in clause 8.1(a), the effects the changes are likely to have on employees and measures to avert or mitigate the adverse effects of such changes on employees and must give prompt consideration to matters raised by the employees and/or their representatives in relation to the changes.
(ii) The discussions must commence as early as practicable after a definite decision has been made by the employer to make the changes referred to in clause 8.1(a).
(iii) For the purposes of such discussion, the employer must provide in writing to the employees concerned and their representatives, if any, all relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on employees and any other matters likely to affect employees provided that no employer is required to disclose confidential information the disclosure of which would be contrary to the employer’s interests.
8.2 Consultation about changes to rosters or hours of work
(a) Where an employer proposes to change an employee’s regular roster or ordinary hours of work, the employer must consult with the employee or employees affected and their representatives, if any, about the proposed change.
(b) The employer must:
(i) provide to the employee or employees affected and their representatives ,if any, information about the proposed change (for example, information about the nature of the change to the employee’s regular roster or ordinary hours of work and when that change is proposed to commence);
(ii) invite the employee or employees affected and their representatives, if any, to give their views about the impact of the proposed change (including any impact in relation to their family or caring responsibilities);and
(iii) give consideration to any views about the impact of the proposed change that are given by the employee or employees concerned and/or their representatives.
(c) The requirement to consult under this clause does not apply where an employee has irregular, sporadic or unpredictable working hours.
(d) These provisions are to be read in conjunction with other award provisions concerning the scheduling of work and notice requirements.
I will set out the terms of clause 9 later in these reasons.
Relevant Facts
The respondent owns and operates eight car dealerships throughout Queensland.
The applicant reported to his general manager, Mr Robert Bradbury. Mr Bradbury was the general manager for the respondent at the Robina dealership site where he managed three franchise brands: Hyundai; Mazda and Volkswagen.
According to the undisputed evidence, the applicant was served with a written warning on 5 August 2016, a few months after he commenced work.
This warning arose out of events in about June 2016. It was made with respect to fraudulently representing insurance details to complete a finance settlement. The letter specified, as a matter of concern with regard to the applicant’s performance, the following issue:
…Putting the company in a compromising position by falsifying an insurance policy number to complete a transaction.
It appears that the applicant failed to confirm with a customer that adequate insurance was in place. The customer was involved in a motor vehicle accident. The respondent became liable for the costs of repair. It was agreed, according to the letter, that the costs of the motor vehicle repair of $1,735.70 would be deducted from the applicant’s commissions.
The applicant states in his December 2017 Affidavit that this happened because of “sheer workload” and inadequate support from the respondent. He gave no detail of these assertions and nonetheless signed the letter confirming that he had received it and understood, “the potential implications of failing to address these concerns and improve on my performance”.
Although part of the background matrix of facts, the first warning did not play any direct part in the case brought by the applicant, nor was it referred to by the respondent in any action taken by it in relation to the applicant. After the first warning, the applicant continued his employment with the respondent.
The applicant gave evidence that during his time with Robina Hyundai he, “constantly achieved a better result than the previous Business Manager who was in that position for approximately 3 years”. He said that to achieve such results and even complete daily tasks his role:
…required me to stay later than normal on a majority of work nights or come in early, approximately 3-4 times a week. My normal hours of work were between 8am to 6pm without a scheduled break or lunch. These breaks were meant to be taken when there was downtime and no customers around. Some days I’d arrive at 7.30 am and be there until 8 or 9pm.
In January 2017, the respondent made a decision to offer, in its Hyundai dealerships, a complimentary mechanical protection plan to customers called the Harrier National Warranty Program (“the Harrier program”). The Harrier program is important in this matter.
The applicant gave evidence that in February 2017 at an offsite meeting with Mita Borell, Anthony Dowell and Robert Bradbury new budgets were proposed by Mr Bradbury. He gave evidence that such meetings were fairly common and occurred once a month.
Mr Borrell gave evidence in the respondent’s case. He has been employed by the respondent for about three and half years at the time of the hearing as a Finance and Insurance Business Manager for the Volkswagen and used car dealership at Robina. He had no recollection of new budgets being introduced in February 2017.
Mr Bradbury gave evidence that in early March 2017, he and Mr Michael Schapowal, Group Finance and Insurance Manager, met with the applicant in relation to his request for the respondent to provide visa sponsorship for him because his existing Visa was due to expire in January 2018. According to Mr Bradbury no new budgets were proposed at this meeting. The purpose of the discussion was to ascertain a proposal for sponsorship from the applicant that could be taken to senior management. At this meeting Mr Bradbury and Mr Schapowal asked the applicant for a commitment to what he could consistently deliver in terms of income for the business. The applicant stated he was unable to commit to or achieve the Key Performance Indicators (“KPIs”) required by the respondent.
The applicant does not refer to this meeting in either of his Affidavits.
Mr Bradbury said the applicant’s KPIs were no different to the KPIs of other Business Managers at the Robina dealership.
However, on 13 March 2017 the applicant sent a detailed email to Mr Bradbury and Mr Schapowal, outlining a number of concerns. The email mentions a meeting the previous Thursday, which appears to be the meeting referred to by Mr Bradbury. The email also makes reference to “new budgets”.
In the email the applicant stated that he:
…objectively and statistically analysed the results from my time employed, versus the previous fiscal year, and versus a combination of my 8 months’ employment and the previous Business Manager’s 7 months’ results leading up to my arrival.
and expressed the view that the KPIs he was being subjected to were unobtainable. The applicant included what he claimed were supporting calculations for the conclusions drawn.
According to Mr Bradbury, this email was not what the applicant was asked for at the earlier meeting. Rather he was asked for information which could be utilised to assess his request for sponsorship.
The evidence of Mr Schapowal supports that of Mr Bradbury, both as to the purpose of the earlier meeting and the nature of the email. Both he and Mr Bradbury stated that no new budgets for the applicant were discussed at the meeting.
It was not clear in what way this evidence related to the claims made by the applicant, as discussed later in these reasons. However, I am not satisfied that new budgets were put forward by the respondent in February 2017. There may have been some confusion between the parties about what each understood the applicant was going to provide as a result of the meeting in early March 2017.
The applicant says he never received a response to the email of 13 March 2017. However, Mr Schapowal gave evidence he had a telephone conversation with the applicant in which he explained that the KPIs were set by the respondent and were not up for negotiation. According to Mr Schapowal, the applicant told him he had received another offer from another organisation which offered both sponsorship and better KPIs. Mr Schapowal told the applicant that he would understand if the applicant wished to accept this other position, but the respondent could not promise it would be able to offer sponsorship.
Mr Bradbury also gave evidence that he spoke to the applicant and explained KPIs could not be changed, that every sales environment had targets and KPIs, however, the applicant was objecting to all of them.
The respondent ultimately formed the view that it could not sponsor the applicant for a visa because there was not an applicable sponsorship class for the applicant’s role.
The applicant gave evidence that after this time the demeanour and attitude of Mr Schapowal and Mr Bradbury towards him deteriorated. He says, “My emails were ignored, I was left out of meetings, my performance was unfairly and unjustly criticised, and conversations regarding sponsorship ceased”. Mr Bradbury on the other hand gave evidence that the applicant became inflexible, showed a “work to rule” attitude and was generally angry and hostile.
Harrier National Warranty Program
A central element of the applicant’s case concerned the implementation of the Harrier Program. The applicant took the view during his employment that the implementation of this program was a major work place change requiring consultation in accordance with clause 8 of the Award.
Both Mr Bradbury and Mr Schapowal gave evidence about this program. Mr Bradbury said that the respondent had been using the Harrier program for a number of years in the respondent’s Mazda and used car dealerships. The decision was made to introduce it to the Hyundai brand franchise. The program provided customers with a certain level of mechanical protection coverage if they agreed to have the vehicles scheduled maintenance requirements undertaken by one of the respondent’s service centres. Under the program, there were two separate levels of coverage. Standard coverage was provided to customers at no cost and offered three years mechanical protection beyond the manufacture warranty. The premium coverage product was an upgrade option which customers could purchase at a cost.
Mr Schapowal said the standard coverage provided for mechanical protection for a total of up to 175,000 km for $1,000 per claim, up to a total limit of $3,000. The premium coverage was provided as an upgrade option to the standard coverage at a cost of $795. It provided mechanical protection for up to 200,000 km for $2,000 per claim with no total claim limit.
According to Mr Schapowal, the applicant and other employees were entitled to earn commission on the upsell of the product from the standard complimentary cover to the premium coverage, with a potential to earn approximately $78 per upsell.
Mr Schapowal also explained that with the implementation of the Harrier program all business managers, including the applicant, were required to activate and record the complimentary Harrier Warranty cover for all new and demonstration Hyundai vehicles delivered.
The implementation process required that the vehicle details be entered into an online system with the national product provider, ‘Harrier National’, to activate the free mechanical protection plan. The plan contract details were then to be entered into the respondent’s internal software system, known as “ERA”, which the respondent used for stock control, preparing contracts, invoices and customer management. According to Mr Schapowal, the time taken to complete the task of entering the details into the computer system is approximately 4 to 5 minutes per customer. Mr Schapowal gave evidence that business managers in the Mazda and used vehicle dealerships had already been implementing the Harrier program process for many years. As Mr Schapowal pointed out, since the applicant’s monthly average for vehicle deliveries had been approximately three per day, the likely time required to implement the Harrier program would be approximately up to 15 minutes per day.
According to Mr Schapowal training in relation to the Harrier program was arranged by the respondent for all business managers.
Mr Borrell gave evidence about the Harrier program, consistent with Mr Schapowal. According to his evidence it takes him 3 to 5 minutes per customer to undertake the administrative task associated with activating the Harrier program. Mr Borell said that he delivers 30 cars per month requiring activation of the program, and with an average of 1 to 2 cars delivered per day, it takes him a maximum of 6 to 10 minutes to undertake implementation of the program.
This evidence concerning the nature of what the Harrier program required of a Business Manager was not challenged by the applicant. I accept this evidence as generally accurate in its description of the nature and impact of the Harrier program on Business Managers.
On 23 March 2017 the applicant received what he called “an unannounced visit” from a representative for the Harrier Program. According to the applicant, this appointment was never scheduled or confirmed with him. At this meeting the representative for the Harrier Program provided to him warranty booklets and a brief explanation of the Harrier National Warranty. The applicant says he received no training on the system, set up process, or the presentation of the product.
It was common ground that the Harrier program was intended to be offered to all customers from 1 April 2017. On 24 March 2017, the applicant sent an email to Mr Schapowal asking whether there would be any “clarification surrounding these Harrier warranties that I am meant to be setting up for every customer from 1 April?”. Mr Schapowal did not respond by email but he telephoned the applicant to say that he would go through the Harrier program with him on his next visit.
The applicant gave evidence that by 30 March 2017, he still had not received any training or visits from Mr Schapowal regarding the Harrier program. He received emails on 30 and 31 March 2017 stating training had been undertaken by a Harrier warranty representative, clarifying the price of the Harrier program and confirming the commencement date as 1 April 2017. The applicant maintained that he still had not received adequate training in regards to the product or set up process by that date.
On 3 April 2017, a meeting took place in the applicant’s office, at his request, with Mr Schapowal. The applicant says that he prepared a schedule of things discussed in writing which appeared as Annexure G to his November affidavit (pages 229 to 230). At the meeting he says that he expressed a number of concerns as follows:
a)That if he was required to set up and sell the Harrier warranty to each customer, it would substantially increase his administrative tasks;
b)It would detract from his ability to meet his current KPIs;
c)There were no requirements in his contract for Warranty KPIs; and
d)From an ethical standpoint, he did not feel comfortable upselling the product to the customers in circumstances where there was no value to customers.
I note here that the applicant relied upon the verbal statements at this meeting as his first complaint in exercise of a workplace right (“first complaint”).
The applicant acknowledged that the handwritten notes on the annexure were not all taken at the meeting, saying “Some were taken after the meeting as notes from contact with certain agencies and Fair Work.” This shows Annexure G was not an entirely contemporaneous record.
A closer inspection of Annexure G also shows that the applicant sought feedback or input on the analysis that he had sent through on 13 March 2017. He sought an update on possible sponsorship. It is clear from the notations on Annexure G that the applicant stated he was too busy to act as “an admin”. He also asked “What benefit is there for me?” and if there would be any “increase in retainer to match additional work”. It appears from Annexure G, that the applicant thought there was “no upsell potential, just an added admin task”.
The applicant also told Mr Schapowal and Mr Bradbury that he had been offered a new position in Brisbane with better remuneration and, “instant permanent residency sponsorship”.
According to Mr Schapowal’s version of this meeting, the applicant complained about the administrative task of implementing the Harrier program, but did not refuse to do it. Mr Schapowal says there was no “ethical” concern expressed by the applicant. He states that he explained to the applicant the process to implement the Harrier program, including upsell potential and pointed out that there were no KPIs for upsell of the Harrier warranties, which was to the applicant’s advantage, because he was not required to meet any particular benchmarks for the Harrier program.
Mr Schapowal gave evidence that other employees in the position of the applicant, namely Business Managers, had successfully implemented the Harrier program without any detrimental effect on their performance outcomes.
According to Mr Schapowal in a telephone conversation with the applicant prior to 19 April 2017, in which he asked the applicant when he would implement the Harrier program, the applicant said he would “get onto it”, and did not request any further training or advice.
On 19 April 2017, the applicant received an email from Mr Schapowal asking about implementation of the Harrier program. He responded reiterating his concerns regarding the implementation of the program. In his email at Annexure H of his November Affidavit (pages 231 to 233) the applicant said:
Therefore, the stipulation requiring extra work and extra reasonable hours outside of the position set forth in the signed agreement and the coinciding remuneration is not being met on your part. In lieu of that, I will not be setting these warranties up as it is outside my currently agreed to duties and corresponding remuneration.
If additional remuneration is discussed and appropriated for the extra work I’m happy to perform the new task. If not, I must decline the option of issuing these warranties.
The applicant relied upon this email as his second complaint (“second complaint”).
It can be seen that the concerns of the applicant, as articulated in this email, were limited to extra work without extra remuneration. There was no mention or reiteration of any ethical concerns in relation to the Harrier program.
The applicant contends that in about April 2017 an incident occurred at a golf event (“the golfing incident”), which both parties agree was not a sanctioned work event but which was attended by a number of employees of the respondent. The applicant gave no direct evidence about the incident in either of his Affidavits. However, details appear in an email to Ms Megan McKenzie dated 19 April 2017 (Annexure I: to his November affidavit). At this event, the applicant alleges that a number of fellow employees of James Frizelles Automotive Group hit golf balls at a group of people, including himself, one of which narrowly missed the applicant’s head. The applicant concedes that after several warnings being given for the behaviour to be ceased after which the behaviour continued, he did address the situation “in an aggressive manner with extremely explicit language in a boisterous tone” (Annexure MM7, Affidavit of Megan McKenzie filed 11 December 2017).
It is the applicant’s evidence that following the golfing incident, he experienced bullying and harassment in the workplace. He said at paragraph 23 of his Affidavit filed 13 November 2017 that the actions of certain employees “Left me feeling further ostracized [sic] and on the outside looking in”.
The applicant contends that on 19 April 2017, he attempted to raise his concerns with Mr Bradbury following the incident, including via email and attempting to telephone him and leaving a voicemail, but received no reply from Mr Bradbury. It was clear from the oral evidence that the applicant was the only person to make a complaint about this incident.
The applicant also alleged in the email that another employee called Darren Wrzesien had spread falsities throughout the Robina dealership about him and had slandered his name and reputation. There was no evidence led by the applicant which supported this particular assertion.
Further on 19 April 2017, the applicant emailed Ms McKenzie, Group Human Resources Managers for the respondent detailing how he was now feeling ostracised in the work environment and requesting a formal meeting “with the individuals involved, Management and Human Resources [sic] to mediate the discussion so that the truth can come out and the situation addressed appropriately” (Annexure MM3, Affidavit of Megan McKenzie sworn 11 December 2017).
The applicant relied upon the email dated 19 April 2017 as his third complaint (“third complaint”).
After a series of email exchanges between the applicant and Ms McKenzie, a meeting was scheduled for 26 April 2017. The applicant gave evidence that during this period – by which he appears to mean 19 April 2017 to 26 April 2017– he never felt comfortable at work. He says “I avoided the other dealerships to avoid those same employees. I was constantly anxious while performing my duties”.
On 24 April 2017, the applicant received an envelope containing an anger management counselling and courses form by way of the James Frizelles Automotive Group internal mail system (“the internal mail incident”). This mail was from an anonymous source. The applicant gave evidence that after receiving the anonymous letter he was “nauseous and dumbfounded” (paragraph 27, Applicant’s Affidavit filed 13 November 2017). The applicant emailed Ms McKenzie about this incident on the same day.
The applicant relied upon the email dated 24 April 2017 as his fourth complaint (“fourth complaint”).
Ms McKenzie in her Affidavit sworn 11 December 2017 gave uncontested evidence that she conducted an investigation into this incident, but the investigation had not been concluded at the time the applicant’s employment was terminated. The investigation was ultimately unable to identify the sender of the internal mail.
On 26 April 2017, the applicant met with Ms McKenzie to discuss his complaints. The applicant and Ms McKenzie met and discussed his bullying and harassment complaints in Mr Bradbury’s absence. At paragraph 28 of his November Affidavit the applicant says “I identified Mr Bradbury, amongst others, as a person causing me discomfort in the workplace.”
On the same day, 26 April 2017, Mr Bradbury and Mr Schapowal approached the applicant in his office to have a discussion about his failure to set up the Harrier program. According to the applicant (paragraph 29 of his November Affidavit) in the meeting he said:
I once again reiterated my concerns regarding the Harrier Warranty and the significant impact this would have on the terms of my employment. I conveyed that I was already staying late to complete my current tasks and role. An average of 3 to 4 nights per week and the role sometimes required me to be there from 7:30am until 9pm to complete my duties. I also queried as to why I wasn’t given any notice or consultation prior to implementing the sale of a new product and what the effect on me would be. I asked how it was a reasonable request to not be required to setup a Harrier Warranty for any customer or 0%; to now being required to set up Harrier Warranties for 100% of customers. I told them I did not think this was a reasonable request. I was advised that the Respondent would take the information on board and follow up with me later.
Mr Bradbury and Mr Schapowal described this meeting as “informal”, to see how the respondent could work with the applicant to encourage him to adhere to the respondent’s request that he implement the Harrier program. Mr Bradbury specifically asked the applicant if he was going to perform the task of implementing the Harrier program, to which the applicant replied “No”.
On 27 April 2017, the applicant sought medical attention for stress and anxiety. He annexed a medical certificate to his November Affidavit. He gave evidence that the medical advice was for him to take a few days off work and not to return until 2 May 2017, and he had annual leave scheduled for 28 April to 1 May 2017. During his time away, the applicant says “Dealer Socket”, the respondent’s customer relationship management system, was never actioned and other tasks were not completed and the relief business managers did not set up any Harrier warranties.
On 2 May 2017, the applicant received a letter from Mr Bradbury requesting he attend a meeting to discuss his failure to implement the Harrier Warranty and to complete Dealer Socket entries. The applicant contends that as at this date he had also still not received appropriate formal training to use the Dealer Socket system.
Also on 2 May 2017, the applicant responded with a letter via email requesting that a third party such as the FWO mediate the dispute between him and the respondent prior to engaging in a formal meeting. The applicant informed the respondent of his intention to contact the FWO. In his email of 2 May 2017 which was sent at 5:34 pm, he says:
If an acceptable third party and/or outcome for the parties involved isn’t reached in, or prior to, mediation, I will be contacting the Fair Work Ombudsman to get involved as is my right under my contract.
Annexure “H” to the applicant’s December Affidavit was a copy of an Interaction Summary from the FWO detailing his interactions with that entity. It shows the applicant in fact contacted the FWO on 2 May 2017 at 2:05pm. Accordingly, it is clear that the applicant had already been in contact with the FWO prior to sending his email to the representatives of the respondent at 5:30pm. This has some significance because it is the applicant’s case that adverse action was taken against him by the respondent because of his threat to contact the FWO.
It is clear from his email of 2 May 2017 that in the applicant’s mind the most important issue was whether the terms of his contract of employment as set out in his letter of retainer covered at least implicitly the introduction of duties to implement the Harrier Warranty Program. In his email he says:
If the mediator/Ombudsman agrees to the interpretation from Robert and Michael that these proposed duties are inherently covered in my contract, I will attend the formal meeting and we can discuss the issues and possible remedies at hand. If the Mediator/Ombudsman sides with my interpretation, discussing this topic in the proposed meeting would be moot.
It appears from the email, however, that the applicant was prepared to discuss the use of DealerSocket.
At paragraph 37 of his November affidavit, the applicant states that he contacted the FWO, “To begin the dispute resolution process as I’m entitled to under section 9 of the Award”. I will return to this later in these reasons.
On 3 May 2017, the applicant met with Mr Bradbury, Ms McKenzie and Mr Schapowal to discuss the issue of the implementation of the Harrier Program. He states that “during the meeting Mr Schapowal acknowledged the implementation of the Harrier Warranty was a significant change”. Ms McKenzie took notes of the meeting. They indicate that the applicant stated in his view it was a “major change”.
According to the notes Mr Bradbury said it was a “Not unreasonable request. It takes five minutes to implement the process for each customer”. The notes also indicate that Mr Bradbury said “You are showing inflexibility for change”.
The applicant maintained his position that there were no warranty duties in his contract. It was acknowledged by Mr Schapowal that if there were no KPIs in the applicant’s contract concerning warranties, he was automatically at an advantage.
Mr Schapowal in his Affidavit denies saying anything to the effect that implementing the Harrier program was a major change. The notes indicate that the applicant stated “It is a significant change and no consultation” to which Mr Bradbury replied “No [sic] a significant change; it is a five minute job”. According to the notes it was pointed out to the applicant that the request for the Harrier Warranty implementation was “a reasonable request” and Mr Bradbury further said “We will continue to grow the business. You need to be prepared for this”.
I do not accept the applicant’s evidence that at any point in the meeting Mr Schapowal acknowledged the implementation of the Harrier warranty was a significant change.
Mr Schapowal gave evidence that he explained to the applicant that the implementation of the Harrier program fell within his duties as set out in Appendix 2 of the employment contract, for example, “offering a range of finance and insurance options available to vehicle purchasers”, the obligation “to undertake any other jobs as agreed between the employee and manager” and “The Job Description may be subject to change depending on business needs.”
Ms McKenzie gave evidence. It was her evidence that the applicant in the meeting stated the Harrier program was not part of his duties and if he was to implement it, he should receive additional payment. Ms McKenzie’s evidence was that it was the applicant who characterised the introduction of the Harrier program as a “significant change”.
The applicant gave evidence that he continued to perform his role in this period at a high standard “even though I felt continuously anxious and stressed at work due to the harassment and bullying I was being subjected to”.
The harassment which the applicant contends he was suffering is detailed in an email response to Ms McKenzie sent by him on 4 May 2017 at 4:36 pm. He used the text of an email from Ms McKenzie on 2 May 2017 to which he made specific response. These emails are set out at pages 268 to 271 of his November Affidavit.
It is clear from the text of this email that the source of harassment all went back to the golfing incident and the receipt of the anonymous piece of mail. The email suggests that the combination of these events together with what he viewed as dismissive attitude by Mr Bradbury and a failure by him to take the complaint seriously led to the applicant feeling marginalised.
However, this source of harassment does not appear to be connected in any way to the question of implementing the Harrier warranty program.
On 4 May 2017, the applicant met with Mr Bradbury and Mr Schapowal who issued him with a second written warning (“second warning). The applicant was also issued with a Performance Improvement Plan (“PIP”). The PIP required the applicant to, inter alia, immediately activate the Harrier program for all customers from then onwards.
It is undisputed that the applicant refused to sign either document. At paragraph 43 of his November Affidavit he says:
I felt the implementation of the PIP and the written warning was an attempt to coerce me into undertaking the duties. I felt this way because they knew my intention to contact the Fair Work Ombudsman to resolve our dispute. To be disciplined over a duty still in dispute felt wrong to me and I expressed this to the Respondent. I could not understand why the Respondent was not willing to let the Fair Work Ombudsman make a ruling before instituting disciplinary measures.
A number of events took place on 10 May 2017:
a)The applicant states that he received unfair treatment at a monthly benchmarking meeting on 10 May. He states that during that meeting Mr Schapowal singled him out in front of business managers and others for a failure to sell any policies in credit consumer insurance. The applicant says this was unfair because he had had the same result in the majority of previous months without any comment. There were also at least the other four business managers present with the same result who were not referred to.
b)Mr Schapowal denies the applicant was subject to any unfair treatment on 10 May 2017. According to Mr Schapowal, the meeting was not unusual, nor was the applicant singled out or criticised in any way. I prefer the evidence of Mr Schapowal in this regard.
c)The applicant gave evidence that also on 10 May 2017 Mr Schapowal treated two other business managers from the Robina dealership to coffee. The applicant’s perception was that he was deliberately excluded and not invited to attend. This led to him, “feeling isolated and ostracised and overall unwanted”. Mr Schapowal denied this and explained these events on 10 May 2017 as merely “an impromptu coffee break” unconnected with the applicant, and involving no deliberate behaviour towards him at all. Mr Borell gave evidence about this event which is consistent with Mr Schapowal, namely, that an impromptu, informal coffee break took place, which was not designed to exclude the applicant.
d)Ms McKenzie contacted the applicant regarding his complaint of bullying and harassment against Mr Wrzerien and Mr Bradbury and she attempted to dissuade him from proceeding with his complaint against Mr Bradbury. At paragraph 50 of his November Affidavit the applicant says:
At this point I no longer felt comfortable at work. I honestly felt like everyone was against me and no one was willing to work with me to resolve legitimate complaints and concerns. Raising any sort of issue placed me further on the outside looking in, but I continued to perform my role to the best of my abilities.
Also on 10 May 2017 the applicant again met with Mr Bradbury and Mr Schapowal in relation to the PIP that had been issued to the applicant on 4 May 2017. The applicant gave evidence that at this meeting he reiterated his concerns about the roll out, lack of consultation, his moral and ethical dilemma, and the fact that the dispute between him and the respondent “about all of it” had not been mediated by the FWO. Mr Schapowal gave evidence that the applicant refused to implement the Harrier program and follow a directive by the respondent to do so.
The applicant relied upon what was said by him at this meeting as his fifth complaint (“fifth complaint”).
The applicant also stated he was waiting to hear back from the FWO. Mr Schapowal gave evidence, supported by Ms McKenzie, that as at 10 May 2017 the respondent had been given no details of involvement by the FWO by the applicant, nor had the respondent been contacted by the FWO. It appeared to be undisputed that at no stage did the FWO contact the respondent about the applicant or his employment.
On 12 May 2017, a Harrier representative appeared at the Robina dealership and said he was there to replace the Harrier warranty booklets provided in his last business meeting because they were incorrectly printed. The applicant gave evidence that “In my head, this further confirmed that the product was flawed at launch due to poor coordination, discussion, and consultation”.
Also on 12 May 2017, the applicant was served with a third written warning for his continuing failure to follow the respondent’s direction in relation to implementing the Harrier Warranty program and non-compliance with the PIP, which he acknowledges at paragraph 52 of his November affidavit “wasn’t unexpected”.
On 13 May 2017, the applicant was feeling especially anxious and stressed by recent developments and, “the ever-crushing fear of losing my job”. He says on the same day he found out that the Hyundai business manager in the Tweed dealership had an assistant completing the Harrier Warranty portion of their duties. He says that he got absolutely no sleep that night and his mental state deteriorated and he sought medical attention on 14 May 2017. He consulted a doctor who advised him to take five days off work and not do anything work related to reduce his stress and anxiety levels.
The applicant returned to work on 22 May 2017.
On 24 May 2017, the applicant was directed to attend a PIP meeting with Mr Bradbury, Mr Schapowal and Ms McKenzie. Although he did not feel the meeting was appropriate he attended anyway. At this meeting there is no dispute that the applicant again refused to implement the Harrier program.
Approximately 15 minutes after the conclusion of the meeting the applicant was handed a termination letter and informed that his termination was effective immediately. According to the evidence of the applicant after his termination his mental health deteriorated and he was referred to a clinical psychologist by his GP.
Further Employment
The applicant gave evidence that he had been forced to spend most of his savings while looking for a replacement role.
On 6 November 2017 he obtained another business manager position with another automotive group. However, in oral evidence, the applicant made clear that he is presently working as an accountant in the United States of America.
Statutory Provisions
Section 340 of the Fair Work Act (supra) is as follows:
340 Protection
(1) A person must not take adverse action against another person:
(a) because the other person:
(i) has a workplace right; or
(ii) has, or has not, exercised a workplace right; or
(iii) proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or
(b) to prevent the exercise of a workplace right by the other person.
Note: This subsection is a civil remedy provision (see Part 4‑1).
(2) A person must not take adverse action against another person (the second person) because a third person has exercised, or proposes or has at any time proposed to exercise, a workplace right for the second person’s benefit, or for the benefit of a class of persons to which the second person belongs.
Note: This subsection is a civil remedy provision (see Part 4‑1).
Section 341(1) and (2) of the Fair Work Act (supra) provide as follows:
341 Meaning of workplace right
Meaning of workplace right
(1) A person has a workplace right if the person:
(a) is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or
(b) is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or
(c) is able to make a complaint or inquiry:
(i) to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
(ii) if the person is an employee—in relation to his or her employment.
Meaning of process or proceedings under a workplace law or workplace instrument
(2) Each of the following is a process or proceedings under a workplace law or workplace instrument:
(a) a conference conducted or hearing held by the FWC;
(b) court proceedings under a workplace law or workplace instrument;
(c) protected industrial action;
(d) a protected action ballot;
(e) making, varying or terminating an enterprise agreement;
(f) appointing, or terminating the appointment of, a bargaining representative;
(g) making or terminating an individual flexibility arrangement under a modern award or enterprise agreement;
(h) agreeing to cash out paid annual leave or paid personal/carer’s leave;
(i) making a request under Division 4 of Part 2‑2 (which deals with requests for flexible working arrangements);
(j) dispute settlement for which provision is made by, or under, a workplace law or workplace instrument;
(k) any other process or proceedings under a workplace law or workplace instrument.
Prospective employees taken to have workplace rights
Section 342 of the Fair Work Act (supra) relevantly provides as follows:
342 Meaning of adverse action
(1) The following table sets out circumstances in which a person takes adverse action against another person.
Meaning of adverse action Item Column 1
Adverse action is taken by ...
Column 2
if ...
1 an employer against an employee the employer:
(a) dismisses the employee; or
(b) injures the employee in his or her employment; or
(c) alters the position of the employee to the employee’s prejudice; or
(d) discriminates between the employee and other employees of the employer.
…
(2) Adverse action includes:
(a) threatening to take action covered by the table in subsection (1); and
(b) organising such action.
(3) Adverse action does not include action that is authorised by or under:
(a) this Act or any other law of the Commonwealth; or
(b) a law of a State or Territory prescribed by the regulations.
(4) Without limiting subsection (3), adverse action does not include an employer standing down an employee who is:
(a) engaged in protected industrial action; and
(b) employed under a contract of employment that provides for the employer to stand down the employee in the circumstances.
Section 352 of the Fair Work Act (supra) provides is as follows:
352 Temporary absence—illness or injury
An employer must not dismiss an employee because the employee is temporarily absent from work because of illness or injury of a kind prescribed by the regulations.
Note: This section is a civil remedy provision (see Part 4‑1).
Section 545 of the Fair Work Act (supra) provides as follows:
545 Orders that can be made by particular courts
Federal Court and Federal Circuit Court
(1) The Federal Court or the Federal Circuit Court may make any order the court considers appropriate if the court is satisfied that a person has contravened, or proposes to contravene, a civil remedy provision.
Note 1: For the court’s power to make pecuniary penalty orders, see section 546.
Note 2: For limitations on orders in relation to costs, see section 570.
Note 3: The Federal Court and the Federal Circuit Court may grant injunctions in relation to industrial action under subsections 417(3) and 421(3).
Note 4: There are limitations on orders that can be made in relation to contraventions of subsection 65(5), 76(4), 463(1) or 463(2) (which deal with reasonable business grounds and protected action ballot orders) (see subsections 44(2), 463(3) and 745(2)).
(2) Without limiting subsection (1), orders the Federal Court or Federal Circuit Court may make include the following:
(a) an order granting an injunction, or interim injunction, to prevent, stop or remedy the effects of a contravention;
(b) an order awarding compensation for loss that a person has suffered because of the contravention;
(c) an order for reinstatement of a person.
Eligible State or Territory courts
(3) An eligible State or Territory court may order an employer to pay an amount to, or on behalf of, an employee of the employer if the court is satisfied that:
(a) the employer was required to pay the amount under this Act or a fair work instrument; and
(b) the employer has contravened a civil remedy provision by failing to pay the amount.
Note 1: For the court’s power to make pecuniary penalty orders, see section 546.
Note 2: For limitations on orders in relation to costs, see section 570.
(3A) An eligible State or Territory court may order an outworker entity to pay an amount to, or on behalf of, an outworker if the court is satisfied that:
(a) the outworker entity was required to pay the amount under a modern award; and
(b) the outworker entity has contravened a civil remedy provision by failing to pay the amount.
Note 1: For the court’s power to make pecuniary penalty orders, see section 546.
Note 2: For limitations on orders in relation to costs, see section 570.
When orders may be made
(4) A court may make an order under this section:
(a) on its own initiative, during proceedings before the court; or
(b) on application.
Time limit for orders in relation to underpayments
(5) A court must not make an order under this section in relation to an underpayment that relates to a period that is more than 6 years before the proceedings concerned commenced.
Discussion
The applicant argues that he enjoyed a workplace right as specified in s.341(1)(b) because he was able “to initiate, or participate in, a process or proceedings under a workplace instrument”, being the Award, and in s.341(1)(c) because he was able to make a complaint or inquiry, as an employee “in relation to his…employment”.
The respondent denied the applicant had either workplace right.
S.341(1)(b)
There was no dispute that the applicant’s employment fell under the Award. There was no dispute that the Award satisfied the definition of “workplace instrument” in s.12 of the Fair Work Act.
The applicant argued that he had a workplace right because was he was able to initiate, or participate in, a process or proceedings under Clauses 8 or 9 of Part 2 of the Award, which dealt with Consultation and Dispute Resolution respectively.
Clause 8 requires consultation between employee and employer about major workplace changes or changes to hours of work.
Clause 9 sets out a process for dealing with disputes. This requires discussion between the employee and their supervisor or senior management. If these discussions fail to resolve the dispute, a party to the dispute may refer the dispute to the Fair Work Commission.
Clause 9 is in the following terms:
9. Dispute resolution
[Varied by PR542209]
9.1 In the event of a dispute about a matter under this award, or a dispute in relation to the NES [National Employment Standards as contained in Sections 59 to 131 of the Fair Work Act], in the first instance the parties must attempt to resolve the matter at the workplace by discussions between the employee or employees concerned and the relevant supervisor. If such discussions do not resolve the dispute, the parties will endeavour to resolve the dispute in a timely manner by discussions between the employee or employees concerned and more senior levels of management as appropriate.
[9.2 varied by PR542209 ppc 04Dec13]
9.2 If a dispute about a matter arising under this award or a dispute in relation to the NES is unable to be resolved at the workplace, and all appropriate steps under clause 9.1 have been taken, a party to the dispute may refer the dispute to the Fair Work Commission.
[9.3 varied by PR542209 ppc 04Dec13]
9.3 The parties may agree on the process to be utilised by the Fair Work Commission including mediation, conciliation and consent arbitration.
[9.4 varied by PR542209 ppc 04Dec13]
9.4 Where the matter in dispute remains unresolved, the Fair Work Commission may exercise any method of dispute resolution permitted by the Act that it considers appropriate to ensure the settlement of the dispute.
9.5 An employer or employee may appoint another person, organisation or association to accompany and/or represent them for the purposes of this clause.
9.6 While the dispute resolution procedure is being conducted, work must continue in accordance with this award and the Act. Subject to applicable occupational health and safety legislation, an employee must not unreasonably fail to comply with a direction by the employer to perform work, whether at the same or another workplace, that is safe and appropriate for the employee to perform.
9.7 An employee representative and an employer may agree to negotiation skills training leave up to three days with pay, on each occasion, which is necessary to assist the employee representative in their dispute settlement role. The arrangements will be considered by the employer having regard to the normal staffing requirements in the employee representative work area. An employee representative taking such leave will be paid all ordinary time earnings which normally became due and payable during the period of leave, calculated in accordance with clause 29.9 of this award.
S.341(2)(j) provides that “dispute settlement for which provision is made by, or under, a workplace law or workplace instrument” is a process or proceedings under a workplace law or workplace instrument for the purposes of s.341(1)(b). In my view, Clauses 8 and 9 of the Award satisfy this description in s.341(2)(j).
Therefore the applicant contends that he had a workplace right within s.341(1)(b). I agree. It is a right to be consulted about major changes and have discussions with his employer and supervisor and then higher management in the event of “a dispute about a matter under this award, or a dispute in relation to the NES”
S.341(1)(c)(ii)
The ambit of this subparagraph has received some judicial interpretation. It deals with being “able to make” a “complaint” or “inquiry”.
Dodds-Streeton J in Shea v TRUenergy Services Pty Ltd (No.6) [2014] FCA 271; (2014) 314 ALR 346; (2014) 242 IR 1(“Shea”) at 353-354 [29] gave the following summary of conclusions relating to the concept of complaint or inquiry in s.341(1)(c):
I concluded, for reasons set out below, that in the context of s 341(1)(c)(ii) of the Act:
(a) a complaint is a communication which, whether expressly or implicitly, as a matter of substance, irrespective of the words used, conveys a grievance, a finding of fault or accusation;
(b) the grievance, finding of fault or accusation must be genuinely held or considered valid by the complainant;
(c) the grievance, finding of fault or accusation need not be substantiated, proved or ultimately established, but the exercise of the workplace right constituted by the making of the complaint must be in good faith and for a proper purpose;
(d) the proper purpose of making a complaint is giving notification of the grievance, accusation or finding of fault so that it may be, at least, received and, where appropriate, investigated or redressed. If a grievance or accusation is communicated in order to achieve some extraneous purpose unrelated to its notification, investigation or redress, it is not a complaint made in good faith for a proper purpose and is not within the ambit of s 341(1)(c)(ii);
(e) a complaint may be made not only to an external authority or party with the power to enforce or require compliance or redress, but may be made to persons including an employer, or to an investigator appointed by the employer;
(f) a complaint that an employee is able to make in relation to his or her employment is not at large, but must be founded on a source of entitlement, whether instrumental or otherwise; and
(g) a complaint is limited to a grievance, finding of fault or accusation that satisfies the criteria in s 341(1)(c)(ii) and does not extend to other grievances merely because they are communicated contemporaneously or in association with the complaint. Nor does a complaint comprehend contemporaneous or associated conduct which is beyond what is reasonable for the communication of the grievance or accusation.
In Shea at [625] her Honour further held that a complaint the employee “is able to make” in relation to his or her employment:
suggests that there are complaints which the employee is not able to make in relation to his or her employment. The ability to make a complaint does not arise simply because the complainant is an employee of the employer. Rather, it must be underpinned by an entitlement or right. The source of such entitlement would include, even if it is not limited to, an instrument, such as a contract of employment, award or legislation.
In Henry v Leighton Admin Services Pty Ltd & Anor [2015] FCCA 1923; (2015) 299 FLR 342 at [73] Judge Manousaridis concluded that the construction of the expression “is able to make” in s.341(1)(c)(ii) of the Fair Work Act favoured by Dodds-Streeton J in Shea does not reflect any settled construction in the Federal Court or elsewhere. His Honour held at [40] that the expression “is able” bears on its ordinary meaning a broader semantic range, namely, “has a capability” or “has a capacity”.
It is not necessary to consider further this difference of view on the meaning of “is able to make”. Dodds-Streeton J in Shea at [633]-[641] also held that the source of an employee’s ability to make a complaint could be founded in a contract of employment which may incorporate a grievance policy, which conferred rights and imposed duties on employees and employers. For the purposes of this judgment, I respectfully adopt this conclusion.
Here the applicant’s Employment Contract included a grievance procedure, in clause 19 of the terms and conditions. Clause 19.2 specifically provides for either party to notify the Fair Work Ombudsman if they are unable to agree on a person to carry out the grievance resolution process. In my view, this contractual grievance procedure of necessity impliedly permits the making of a complaint in relation to the applicant’s employment, and is sufficient to establish that the applicant had the capability to make a complaint within the expression “is able to make” in s.341(1)(c)(ii). It also specifically permitted the involvement of the FWO, although the employment contract was not a workplace instrument.
In Shea at [626] Dodds-Streeton J agreed with the decision of Riley FM, as she then was, in Ratnayake v Greenwood Manor Pty Ltd [2012] FMCA 350, that it is unnecessary:
that the employee, in making a complaint that he or she is able to make, expressly identifies the communication as a complaint or grievance, or uses any particular form of words. It is necessary only that relevant communication, whatever its precise form, would be reasonably understood in context as an expression of grievance or a finding of fault which seeks, whether expressly or implicitly, that the employer or other relevant party at least take notice of and consider the complaint.
Again I respectfully adopt this conclusion.
Therefore I am satisfied the applicant had a workplace right as defined in s.341(1)(c)(ii).
Adverse Action
The applicant claims the respondent took adverse action against him because he exercised or proposed to exercise the two workplace rights discussed above.
Process or Proceedings
First, the applicant contends that he proposed to exercise, or did exercise, his workplace right under s.341(1)(b), for the purposes of s.340(1)(a)(iii) and because he did so, the respondent took adverse action against him as defined in s.342. The applicant argues that he relevantly proposed to exercise, or exercised, this workplace right by contacting the FWO on 2 and 4 May 2017 “to seek the assistance of the Fair Work Ombudsman to mediate” his dispute with the respondent. The Interaction Summary created by the office of the FWO (Annexure “H” to the applicant’s December Affidavit) records that:
a)On 2 May 2017 the applicant made contact with the FWO;
b)On 4 May 2017 the applicant said to the advisor at the FWO that he believed the parties may need to request the services of FWO “to settle the dispute”.
The applicant argued that the Harrier program was a major workplace change requiring consultation under clause 8 of the Award, which by reason of the first, second and fifth complaints he exercised.
A major work place change in clause 8.1(a)(i) of the Award is a major change “in production, program, organisation, structure or technology that are likely to have significant effects on employees.” Significant effects on employees are described in clause 8.1(a)(ii).
I have already accepted above the respondent’s evidence concerning the nature and impact of the Harrier program. The Harrier program had been part of the respondent’s broader business for some years, even if it was new to the Hyundai range of vehicles sold by the respondent. Other employees, such as Mr Borrell, found it to be a modest imposition on their time, and not difficult to perform. The evidence satisfies me that it was a relatively small administrative task which could readily be accommodated within the ordinary working hours of an employee holding the position of the applicant. The implementation of the Harrier program does not fall within the ambit of a major workplace change for the purposes of the Award, in my view.
Therefore, in my view, although the applicant had a workplace right by reason of clause 8, it was not one exercisable in relation to the implementation of the Harrier program.
Next, the applicant argued that his approach to the FWO fell under clause 9 of the Award, being a workplace instrument. Clause 9 is a dispute resolution clause, the terms of which are set out above.
However, the relevant “process or proceedings” are specified in clauses 9.1 and 9.2. Clause 9.1 specifies “discussions” between employer, employee and supervisor, progressing to “discussions” between employee and “more senior levels of management as appropriate”. Clause 9.2 then specifies referral to the Fair Work Commission if the dispute is not resolved by these discussions.
It can be seen that clause 9 does not mention the FWO at all, as mediator or otherwise. The concept of “discussions” between the parties in clause 9.1 would appear to embrace direct talks not a dispute resolution procedure using a third party. Clause 9.2 refers to the involvement of the Fair Work Commission, not the FWO. Clause 9.5 of the award refers to appointing another person, organisation or association “to accompany and/or represent” the employer or employee. The applicant’s approach to the FWO was not for that purpose. Rather it was to mediate his dispute with the respondent. The contact with the FWO was not a step in a process which is specified in clause 9 of the Award. I am not satisfied the applicant has demonstrated his attempt to involve the FWO was a process or proceedings “under a workplace law or workplace instrument.”
Accordingly, I am not satisfied the applicant exercised or proposed to exercise his “workplace right” under s.341(1)(b) by contacting the FWO, for the purposes of s.340(1)(a)(ii).
Alternatively, the circumstances in which the applicant made the first and fifth of the five complaints may be characterised as “discussions” falling within clause 9.1 of the Award. Although the applicant did not argue this, I will assume this is correct. However, since I have concluded that the Harrier program was not a major workplace change requiring consultation under clause 8 of the Award, it would likely follow that the dispute about it was not a dispute “under the Award”, even if the applicant had made such an argument.
Accordingly, I am not satisfied the applicant at any time exercised or proposed to exercise a “workplace right” under s.341(1)(b).
Complaint
Secondly, the applicant contends he exercised his workplace right as defined in s.341(1)(c)(ii), to make a complaint or inquiry in relation to his employment, by making the five complaints have been set out earlier in these reasons.
As described above, the first, second and fifth complaints expressed grievance at the applicant’s perception of the implementation of the Harrier program. The applicant also claimed he was entitled to consultation under clause 8 of the Award, because the Harrier program was a major workplace change. I have already rejected this contention. The third and fourth complaints concerned grievances about alleged ostracism and bullying in the workplace. The fifth complaint also concerned the PIP. I am satisfied that the five complaints identified earlier in these reasons conveyed a grievance or a finding of fault in relation to the applicant’s employment which would be reasonably understood in the context as an expression of grievance which the applicant asked the respondent to take notice of. I am satisfied that the applicant’s complaints were genuine and made bona fide.
I am satisfied that the applicant exercised a workplace right by making the five complaints detailed earlier in these reasons.
The applicant then alleges that because of the exercise of this workplace right the respondent took adverse action against him in that the respondent:
a)“Injured” him by “performance” managing him and issuing him with written warnings to manage him out of his role or coerce him into undertaking additional duties, namely, implementing the Harrier program, and creating the PIP which included areas the applicant had been completing appropriately;
b)Injured him in his employment by treating him less favourably than other employees, unfairly targeting him about his performance, and excluding him from important managerial meetings (“the allegations of discrimination”); and
c)Dismissed him from his employment.
I am satisfied the actions taken by the respondent against the applicant by issuing him with warnings, placing him on the PIP and dismissing him, fell within the definition of “adverse action”.
I am not satisfied the allegations of discrimination are made out at a factual level, so as to prove adverse action in that regard. The applicant gave evidence that he was discriminated against early in his employment by not being acknowledged for good performance, when others were (see for example, paragraphs 12 to 14 of his November affidavit). However, these allegations, even if true, were not connected by the applicant to any adverse action against him. In relation to the later allegations of discrimination, which were said to be so connected, the evidence satisfies me that the bullying or harassing behaviour suffered by the applicant was undertaken by unknown or unspecified individuals in the organisation, but not by the respondent. This behaviour may have contributed to a perception by the applicant that “everyone” was against him (as set out in paragraph 50 of his November affidavit). The circumstances surrounding the bullying behaviour remain obscure on the evidence presented by the applicant. The respondent took appropriate action by undertaking an investigation. The inconclusive result of the investigation indicates that the culprits took steps to suppress the evidence of their conduct. In my view, responsibility for this reprehensible behaviour cannot be said to be the result of any action or inaction on the part of the respondent.
I am not satisfied that the applicant has demonstrated he was singled out for criticism, or ostracised, either generally or on 10 May 2017. In my view, it is equally probable that by 10 May 2017, the applicant had entrenched himself in opposition to the implementation of the Harrier program and realised this may have placed his employment in jeopardy. This appears to have created a mentality of agitation and vulnerability through which the applicant interpreted the respondent’s pressure for implementation of the Harrier program, the warnings and the PIP, as a form of persecution when objectively they were reasonable responses of the respondent to his inflexibility.
The perception of being treated less favourably, discussed above, even if genuinely held by the applicant, was not reasonably held. I am not satisfied the applicant has proved he was treated less favourably to other employees. His performance became the subject of scrutiny but not unfairly.
That leaves for consideration the actions of issuing warnings, the PIP and dismissal.
“Because of the Exercise of a Workplace Right”
Section 361(1) is important at this point because it creates a statutory presumption that operates in cases where it is alleged that a person contravened s 340. It is in the following terms:
(1) If:
(a) in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and
(b) taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
(2) Subsection (1) does not apply in relation to orders for an interim injunction.
Accordingly, the respondent bears the onus of proving that the adverse action taken against the applicant, namely, issuing him with warnings, placing him on the PIP and dismissing him, was not for prohibited reasons.
Whether a person took certain action for a particular prohibited reason can be a surprisingly difficult question. To answer it, in Construction, Forestry, Mining and Energy Union v De Martin & Gasparini Pty Limited (No.2) [2017] FCA 1046; (2017) 69 AILR 102-860, at [296]-[303] Wigney J distilled the following “key principles” from the High Court decisions in Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500 and Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2014] HCA 41; (2014) 253 CLR 243:
First, the question is one of fact: Barclay at [41], [45], [101]; BHP at [7].
Second, the question is why the adverse action was taken: Barclay at [5], [44]. The focus of the inquiry is the reason or reasons of the relevant decision-maker: Barclay at [101], [127], [140], [146]; BHP Coal at [7], [19], [85]. More particularly, the question is whether the alleged prohibited reason was a “substantial and operative” reason for taking the adverse action: Barclay at [56]-[59], [104], [127]; or an operative or immediate reason: Barclay at [140].
Third, the test does not involve any objective element: Barclay at [107], [121], [129]; BHP Coal at [9]. To speak of objectively obtained reasons risks the substitution by the court of its view, rather than making a finding of fact as to the true reasons of the decision-maker: Barclay at [121]; BHP Coal at [9].
Fourth, the inquiry is not concerned with mere causation, in the sense that it is not sufficient that there is factual or temporal connection between the relevant protected workplace rights and the adverse action: BHP Coal at [18]-[20]. Any such connection, however, may necessitate some consideration as to the true motivation or reasons of the decision-maker: BHP Coal at [22].
Fifth, the question must be answered having regard to all of the relevant facts and circumstances and the inferences available from them: Barclay at [45], [127]; BHP Coal at [7].
Sixth, direct testimony from the decision-maker as to why the adverse action was taken is capable of discharging the burden imposed by s 361: Barclay at [45], [71]; BHP Coal at [38]. However, declarations that the action was taken for an innocent reason may not discharge the onus if contrary inferences are available on the facts: Barclay at [54], [79], [141]. The reliability and weight to be given to such evidence must be assessed having regard to the overall facts and circumstances: Barclay at [127].
Seventh, it is not necessary for the decision-maker to establish that the reason for the adverse action was entirely disassociated from the relevant protected workplace right: Barclay at [62].
I respectfully adopt this statement of principle.
It is clear from the evidence that Mr Schapowal and Mr Bradbury were the decision makers in respect of the adverse action. It is necessary to have regard to the reasoning of both: Construction, Forestry, Mining and Energy Union v Clermont Coal Pty Ltd [2015] FCA 1014; (2015) 253 IR 166, at 198 [121] (references omitted). They both gave evidence.
The applicant in his argument emphasised the temporal link between the exercise of his workplace right and the alleged adverse action. As the principles set out above make clear, although this focus may be relevant, it is too narrow.
I have assessed the facts overall. The evidence satisfies me that the substantial and operative reason for the adverse action was the refusal of the applicant to implement the Harrier program. On the evidence, this refusal seems to have arisen after, and possibly in response to, the applicant being rebuffed about his concerns relating to KPIs and sponsorship. Although the applicant gave evidence about a lack of training, this did not play a part in his refusal to implement the program, and on his own evidence he did receive some training well before terminations. There was no real dispute that the applicant performed his other duties and responsibilities to a satisfactory level. His refusal to implement the Harrier program stands out as a surprising and obdurate position. I am satisfied the evidence from Mr Schapowal and Mr Bradbury discharges the onus placed on the respondent and is not contradicted by inferences from contrary facts. Their evidence is sufficiently consistent with the contemporaneous documents to show that the resistance of the applicant to implement the Harrier program brought about the second and third warnings, the PIP and ultimately dismissal. The exercise by the applicant of his workplace right as discussed above was not the substantial and operative reason for the adverse action of issuing warnings, imposing a PIP or dismissing him.
Temporary Absence
The applicant made a separate claim that the respondent breached s.352 of the Fair Work Act by dismissing him because he was temporarily absent from work due to illness or injury prescribed in the regulations. Regulation 3.01 of the Fair Work Regulations 2009 (Cth) prescribes the relevant illness or injury. The applicant did not make any submissions about the reg.3.01 or whether he suffered an illness or injury falling within the Fair Work Regulations (supra).
The relevant events took place between 13 and 22 May 2017, and are detailed earlier in these reasons. I will assume that the applicant suffered an illness during this time which fell within reg.3.01.
S.352 also falls within Part 3-1 of Chapter 3 of the Fair Work Act (supra), so s.361 also applies to the applicant’s allegation of breach of s.352.
As already discussed the applicant was terminated on 24 May 2017. The evidence of Mr Schapowal and Mr Bradbury as the decision makers was that the applicant was terminated for failure to implement the Harrier program and follow the PIP. The evidence establishes that the applicant’s temporary illness played no part in the decision to terminate his employment.
I am not satisfied this claim is made out.
Superannuation
A separate component of the applicant’s claim was for an amount of superannuation deducted from his commissions in the total amount of $6,624.39. The respondent did not dispute the calculation of the amount.
The applicant argued that he was underpaid his commission because his superannuation payable on those commissions was deducted from the commission amounts before payment to him, rather than being calculated by reference to the full amount of commissions and paid in addition to his commission. The respondent argued its calculation of superannuation on commissions was in accordance with the law, and had been calculated that way by the respondent since 2008.
The applicant did not identify the provision or provisions of the Fair Work Act (supra) which gave this court jurisdiction to determine this claim. However, I will assume this Court has jurisdiction pursuant to s.323 of the Fair Work Act (supra) which obliges an employer to pay amounts payable to an employee “in full” subject to permitted deductions, as defined in s.324.
There was no dispute that the respondent deducted 9.5% from the total commission amount paid to all employees. The applicant contended that this was an incorrect approach. He argued that commissions were classified as “ordinary time earnings” as defined in s.6 of the Superannuation Guarantee (Administration) Act 1992 (Cth) (“Super Guarantee Act”). The s.6 definition is in the following terms:
"ordinary time earnings" , in relation to an employee, means:
(a) the total of:
(i) earnings in respect of ordinary hours of work other than earnings consisting of a lump sum payment of any of the following kinds made to the employee on the termination of his or her employment:
(A) a payment in lieu of unused sick leave;
(B) an unused annual leave payment, or unused long service leave payment, within the meaning of the Income Tax Assessment Act 1997 ; and
(ii) earnings consisting of over-award payments, shift-loading or commission; or
(b) if the total ascertained in accordance with paragraph (a) would be greater than the maximum contribution base for the quarter--the maximum contribution base.
In s.11 of the Super Guarantee Act, “salary and wages” are defined to include “commission.”
The applicant argued that his entitlements to superannuation should have been calculated on his ordinary time earnings. The consequence of this would be that instead of deducting 9.5% for superannuation from commissions, the employer would be obliged to pay 9.5% of the commission amount into the employee’s nominated superannuation fund.
In support of his argument, the applicant relied on Tjorpatzis v E J Love & Co Pty Ltd & Anor [2016] FCCA 2735 (“Tjorpatzis”). In Tjorpatzis, her Honour Judge Riley held at paragraph [44] – [46]:
44. … The difference between the parties was that the applicant believed that he had a right to have superannuation on top of the commission and the second respondent believed the first respondent had the right to deduct superannuation from the commission.
45. The second respondent was mistaken. The law is clear that the 9% employer superannuation contribution had to be paid on top of ordinary earnings, which were defined to include commissions.
46. Even if the applicant had acquiesced in the first respondent deducting superannuation from his commissions, the law required the first respondent to pay superannuation on top of commissions. The applicant’s equivocal conduct cannot be relied upon to undermine clear statutory obligations.
In the passage cited from Tjorpatzis, Riley J was dealing with the argument that an employment contract governs how superannuation on commissions is to be dealt with, and referred to the decision in Fortune Holding Group Pty Ltd v Zhang [2016] VSC 273, in which Riordan J said at [36(a)]:
The obligation to make the superannuation contribution is on the employer. In my opinion, in the absence of other circumstances, an offer to pay a salary of $85,000 would not imply that the employer’s compulsory superannuation contributions would be deducted from that sum. Such an inference would normally only be drawn if the employee was offered that sum as a ‘total package’.
Riley J distinguished Zhang on the basis that in Tjorpatzis there was only “equivocal conduct” and no evidence of any employment contract having the effect of offering the employee remuneration as a “total package”.
The applicant gave no further analysis of the superannuation legislation, which admittedly is not easy to interpret, in support of his claim. Nor did the respondent. The decisions in Zhang and Tjorpatzis appear to support the applicant’s argument, unless his terms of employment specified that superannuation contributions payable in respect of commissions were to be deducted from his commissions before payment to him.
Thus, although the applicant made no reference to them, the terms of the Employment Agreement and the Award are relevant to this claim.
Clause 10.1(a) of the Employment Contract provides that superannuation contributions “form part of all Employee’s total remuneration.” Moreover, clause 13.3 to Appendix 1 provides:
Effective 1 July 2008 a change was made where by superannuation contributions are made only by the employer for base payments, whilst all super payments for commission or bonuses come out of the commission or bonus payment prior to the weekly pay being made to the Employee.
The terms of the Employment Contract thus clearly specify that superannuation contributions referrable to commission or bonuses were to be paid out of the commission amount.
Clause 25.2 of the Award provides:
An employer must make such superannuation contributions to a superannuation fund for the benefit of an employee as will avoid the employer being required to pay the superannuation guarantee charge under superannuation legislation with respect to that employee.
There is no evidence that the respondent has ever been required to pay “the superannuation guarantee charge under superannuation legislation with respect to” any employee, including the applicant.
In conformity with the decisions in Zhang and Tjorpatzis, I am not satisfied that the deductions of superannuation amounts from commission constituted a failure to pay the applicant “in full” in contravention of s.323 of the Fair Work Act (supra).
Accordingly, I do not accept that the applicant has demonstrated any entitlement to be compensated for underpaid superannuation.
Compensation
In light of my findings and conclusions in these reasons, it is not necessary to determine the applicant’s arguments for amounts of compensation. However, I would not have been satisfied that his evidence established the amounts he claimed. Apart from superannuation, the figures were not agreed. His claim for unpaid wages and compensation for stress and embarrassment were not made out on the evidence. His claim for a pecuniary penalty seemed to be misconceived, in that even if such penalty was ordered, it would not have been payable to him.
Conclusion
In light of my findings and conclusions in these reasons, the applicant’s claims should be dismissed.
I certify that the preceding one hundred and eighty-six (186) paragraphs are a true copy of the reasons for judgment of Judge Harper
Associate:
Date: 30 October 2018
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