Vicki Kerry v The Trustee for Claerwen Family Trust T/A Caulfield House

[2016] FWC 7470

[2016] FWC 7470

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Vicki Kerry
v
The Trustee for Claerwen Family Trust T/A Caulfield House
(U2016/7899)

COMMISSIONER BISSETT DARWIN, 26 OCTOBER 2016

Application for relief from unfair dismissal – compensation.

[1] Ms Vicki Kerry worked forThe Trustee for Claerwen Family Trust T/A Caulfield House (Caulfield House) as a Personal Care Attendant (PCA) from May 2013 until June 2016. She has made an application to the Fair Work Commission (the Commission) seeking relief from unfair dismissal pursuant to s.394 of the Fair Work Act 2009 (the Act).

[2] Caulfield House objects to Ms Kerry’s application on the grounds that it says that she was a contractor and not an employee. If she was an employee it says that she was not unfairly dismissed.

Contractor or employee

[3] Caulfield House says that in 2013 Ms Kerry applied for a position of PCA to do sleepovers. This consists of sleeping at the facility and responding to the needs of the residents or emergencies as required. The position, it says, is paid ‘as an allowance’ and staff are able to sleep unless woken in a room provided for that purpose.

[4] Caulfield House says that when Ms Kerry was interviewed she said that she would prefer a higher rate of pay and she would take care of her own superannuation and taxation and make no claim for leave. The rate negotiated was $90.00 for Thursday night and $100.00 for each of Friday and Saturday night.

[5] Ms Kerry says that when she was employed there was no mention of her being a contractor and she did not write ‘contractor’ on any employment papers. She says that a statement written by Caulfield House recognises that she was an employee employed on a permanent basis (although Caulfield House says that the statement was written at Ms Kerry’s request to secure a personal loan).

[6] Ms Kerry says that she was told during the interview that she could be paid ‘off the books’. She says that she was not offered the option of being paid ‘on the books’. Ms Kerry produced her diary entry for the day of the interview where she noted that she was to be paid ‘$90/shift. Cash in hand off books’. She says that after she left the interview the amount for Friday and Saturday was revised to $100.00.

[7] Ms Kerry says that she sought the higher rate of pay in recognition of her qualifications.

Contractor or employee

[8] In On Call Interpreters and Translators Agency Pty Ltd v Federal Commissioner of Taxation (No. 3) 1 Bromberg J posed the matter to be determined as follows:

Simply expressed, the question of whether a person is an independent contractor in relation to the performance of particular work, may be posed and answered as follows:

Viewed as a “practical matter”:

(i) is the person performing the work an entrepreneur who owns and operates a business; and,

(ii) in performing the work, is that person working in and for that person’s business as a representative of that business and not of the business receiving the work?

If the answer to that question is yes, in the performance of that particular work, the person is likely to be an independent contractor. If no, then the person is likely to be an employee. 2

[9] I have considered the proposition of Bromberg J and each of the indicia generally accepted as providing guidance as to whether a person is a contractor or employee 3 and have concluded that Ms Kerry was not an independent contractor but rather an employee of Caulfield House. I have reached this conclusion because Ms Kerry worked at the direction of Ms Marsh; she had no control over when, where and how the work might be done – in fact by its nature it had to be done on the premises at the times specified; she did not run a business; she could not delegate the work and she was paid on a regular basis.

[10] Viewed objectively it is difficult to see how Ms Kerry could have performed the work she did as an independent contractor.

[11] Whilst evidence was given of the conversation that occurred when Ms Kerry was ‘engaged’ by Caulfield House, I am not satisfied that this is reflective of Ms Kerry being engaged as an independent contractor. Even if Ms Kerry did request to be engaged ‘off the books’ this does not mean she would be an independent contractor – it would be no more than a tax avoidance measure. I have not given any weight to the statement of Ms Susan Vincent as to what occurred in the meeting between Ms Marsh and Ms Kerry. Ms Vincent was not present at the meeting and did not attend the Commission such that she could be cross-examined on her statement.

[12] For all of these reasons I am satisfied that Ms Kerry, viewed objectively, was an employee of Caulfield House.

Small Business

[13] I am satisfied that Caulfield House is a small business.

[14] Evidence was given by both Ms Kerry and Ms Marsh as to who were employees of Caulfield House.

[15] Ms Kerry gave evidence that at the time she was employed at Caulfield House there were 19 or more employees. These were:

Jodie Marsh, Vicki Kerry (herself), Sue Vincent, Ingrid, Anna, Teresa, Ti, Georgina, Josie, Sharron, Krissy, Bree, Abi, Danielle, Iggy, Zac (handyman), Karin (away), Issy (away), Danielle’s mother, Jodie’s friend, Danielle, Krissy’s husband (who did gardening and pruning sometimes). 4

[16] In her oral evidence Ms Kerry said that:

Ti used to work there - she used to work there more regularly, but then she was doing a university course so she was only sort of picked up every now and then when somebody didn’t show up…Georgie used to do the occasional shift…Iggy worked - is Ingrid’s son Karin was in the kitchen. She was there for most of the time I was there, but then she went to Chile.

Danielle’s mother… used to come in on occasion, too, and do cooking.

Christian... That was actually - I didn’t put him down because I forgot about him. He was Karin’s husband and he used to work there on a regular basis as a kitchenhand… I was told he got fired. 5

[17] Ms Kerry said that she had listed everyone who had been employed whilst she had worked at Caulfield House and had not understood that the ‘count’ of employees for the purpose of determining if the business was a small business was at the time her employment was terminated.

[18] Ms Marsh, the Managing Director of Caulfield House, gave evidence that the employees of the business at the time Ms Kerry’s employment ended were:

Jodie Marsh, Vicki Kerry, Susan Vincent, Helen Jothiravi, Ingrid Melgarejo, Anna Layuni, Theresa Scorah, Josephine Fitzgerald, Sharon Hickey, Kristina Fitzgerald, Bree Verran, Abigail Cruz, Daniela Turcarola, Ignacio Rodriguez. 6

[19] Her evidence is that Ti stopped doing regular shifts about one year earlier, Georgina left eight months ago; Karin, Issy and Christian had left over six months earlier, Zac is a handyman who comes in as required and is not an employee; Danielle’s husband is a contractor; Kristina’s husband is mechanic who does not work at Caulfield House and neither Danielle’s mother nor Jodie’s friend were employees. 7

[20] Ms Marsh denied that Zac worked substantially at Caulfield House and that Ti was being called in for regular shifts when Ms Kerry was still working at Caulfield House.

[21] On Ms Marsh’s reckoning there were fewer than 15 employees at the time Ms Kerry’s employment ended.

[22] I have conflicting evidence from Ms Kerry and Ms Marsh as to the number of employees at the time Ms Kerry’s employment was terminated. Whilst I accept that there must be more than ‘mere assertions’ as to the number of employees at the time an employment is terminated, in this case I prefer the evidence of Ms Marsh to that of Ms Kerry.

[23] Ms Kerry has done no more than name a group of people she saw at some stage during her employment at Caulfield House. Assertions by her that they were employees at the time her employment was terminated are not sustainable. That Zac, the handyman’s car did not have his own or some other company logo or name on it (which is, in any event, disputed) is not evidence that he was an employee of Caulfield House.

[24] Ms Marsh on the other hand provided a list of employees generated as at 19 August 2016. Whilst Ms Kerry’s employment was terminated prior to this date I accept the evidence of Ms Marsh that this list, with the addition of Ms Kerry and herself, is the list of employees at the time Ms Kerry’s employment ended.

[25] I am therefore satisfied that Caulfield House is small business and must now determine if the Small Business Fair Dismissal Code applies.

Unfairly dismissed

[26] I am satisfied that Ms Kerry is protected from unfair dismissal.

[27] Section 385 of the Act states:

385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.

[28] I am satisfied that Ms Kerry has been dismissed and the dismissal was not a case of redundancy.

[29] Having determined that Caulfield House is a small business it is necessary to consider if the dismissal was consistent with the Small Business Fair Dismissal Code.

The Small Business Fair Dismissal Code

[30] The Small Business Fair Dismissal Code (the Code) states:

Summary Dismissal

It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.

Other Dismissal

In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.

The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.

The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.

Procedural Matters

In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.

A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.

[31] In Jeremy Ryman v Thrash Pty Ltd t/a Wisharts Automotive Services the Full Bench, after considering the wording of the Code and, in particular, the ‘Summary dismissal’ section, determined that:

In summary, drawing on the conclusions stated above and the ratio in Pinawin, we consider that the “Summary dismissal” section of the Code operates in the following way:

(1) If a small business employer has dismissed an employee without notice - that is, with immediate effect - on the ground that the employee has committed serious misconduct that falls within the definition in reg.1.07, then it is necessary for the Commission to consider whether the dismissal was consistent with the “Summary dismissal” section of the Code. All other types of dismissals by small business employers are to be considered under the “Other dismissal” section of the Code.

(2) In assessing whether the “Summary dismissal” section of the Code was complied with, it is necessary to determine first whether the employer genuinely held a belief that the employee’s conduct was sufficiently serious to justify immediate dismissal, and second whether the employer’s belief was, objectively speaking, based on reasonable grounds. Whether the employer has carried out a reasonable investigation into the matter will be relevant to the second element. 8

[32] It is not disputed that, whilst Ms Kerry was dismissed with immediate effect (although notice was paid), she was not dismissed for serious misconduct.

[33] The serious misconduct provisions of the Code therefore do not apply.

[34] The dismissal of Ms Kerry must therefore be considered to determine if it is consistent with the ‘Other dismissal’ provisions of the Code. To comply with these provisions there must be a valid reason for dismissal based on the employee’s capacity or conduct; the employee must be warned that he or she is at risk of dismissal, the employee must be given an opportunity to respond to the warning and to rectify the problem.

[35] In dismissing Ms Kerry, Caulfield House did not comply with all aspects of the ‘Other dismissal’ provisions of the Code. The matters that require consideration are similar to those in determining if the dismissal was harsh, unjust or unreasonable. For the reason given below with respect to a valid reason and an opportunity to respond I am satisfied that the dismissal was not consistent with the Code.

[36] It is therefore now necessary to determine if the dismissal was harsh, unjust or unreasonable.

Harsh, unjust or unreasonable

[37] Section 387 of the Act 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.

[38] I have considered each of the criteria below.

A valid reason (s.387(a))

[39] Ms Kerry was dismissed by text message from Ms Marsh on 6 June 2016. The text message read:

Hi Vicky

I’m sorry that your having financial hardship perhaps your car might not have been best choice I would imagine causes a lot of stress with payment – might be time to change? I have been consulting with residents today regarding all staff. I’m extremely upset to hear of how you were with John and also Tola. I am upset further to hear of your grumpiness and moods and also your free range relationship with Linda going against most things I ask her not to do. I have to take all things into consideration. I do like you very much but even I myself find your up and down moods unsettling and it’s not fair on the residents. I have come to the difficult decision to let you go. You will have two weeks notice but you are not required to work these and I am going to reroster so your not. This will be processed as normal with pay run. I feel this is more than fair considering my obligation is none. I am sorry that this has happened but I need to take my residents feelings as number one priority. I will pack up any of your belongings and have them couriers to you Thursday. (sic) 9

[40] Ms Marsh’s evidence is that Ms Kerry was a ‘fantastic’ worker when she commenced at Caulfield House. She says that she did send a number of complimentary text messages to Ms Kerry but these were mostly in 2015. She says however that she started to have issues with Ms Kerry’s temper and strong will. Issues included:

● complaints from residents that Linda (a resident) was in the kitchen and office with Ms Kerry when she was not meant to be. 10 Ms Kerry was aware that Linda was not to be in the kitchen or office11 and that Linda was not in the kitchen or office with any other staff;12

● a complaint from a resident that Ms Kerry had told him he ‘wasn’t Jewish’. 13 Ms Kerry had an argument with the resident in question and reported the incident to Ms Marsh via text message but Ms Marsh did not have an opportunity to discuss the matter with Ms Kerry;

● a complaint from a resident that she heard Ms Kerry scream and get very angry with Tola (another resident); 14

● refusal by a resident to come to dinner on Saturday nights because he found Ms Kerry ‘bossy and rude’ and she made him feel uncomfortable; 15

● questioning by Mr Kerry as to access to the facility by Ms Vincent’s adult son (Ms Vincent is a staff member and lives on the premises with her son); 16

● a complaint from Ms Kerry as to the how the resident cat was being treated; 17

● failure to properly set up the breakfast trays. 18

[41] Ms Marsh also gave evidence that Ms Kerry sent her numerous complaints about other staff via text message. Her evidence is that she no longer has the text messages as her phone stopped working and was replaced. She says, however, that the complaints included staff not doing their jobs properly, where staff parked their cars, and the breakfast trays.

[42] Ms Marsh’s evidence is that she was concerned that Ms Kerry’s behaviour was beginning to pose a risk to the residents’ health and safety. She says that she had become concerned at Ms Kerry’s erratic behaviour and attended at Caulfield House on 6 June 2016 to follow up on one of the resident’s complaints. Ms Marsh says that a resident told her that Ms Kerry was in her room unhappy and tearful. The resident said Ms Kerry told her how she believed another staff member was trying to get her sacked. Ms Marsh says she tried to contact Ms Kerry that day but Ms Kerry did not answer her phone. She then sent the text message in which she outlined some of her concerns.

[43] On 6 June 2016 Ms Marsh then sent Ms Kerry the text message in which she terminated her employment.

[44] Ms Kerry’s evidence is that she had some difficulties at work with other staff but there was little cross over with other staff except for handovers between shifts.

[45] Ms Kerry said that she did not understand what Ms Marsh meant with reference to John and Tola in the text message that terminated her employment. She says she had no instances of note with either resident.

[46] Ms Kerry says that she looked in the complaints book on 5 June 2016 and there were no complaints about her in the book at that time.

[47] Ms Kerry says that any complaints about her were mostly from one resident (Arlette) and that she had proven that she was a liar. She says that Ms Marsh agreed with her.

[48] With respect to the specific complaints raised by Ms Marsh, Ms Kerry says that she knows nothing about having allegedly followed a staff member to her car and verbally abused her; 19 she has not complained about staff members or questioned the manager’s son living at Caulfield House;20 she has no recollection of raising her voice to Ms Marsh;21 she has understood the change to the breakfast tray arrangement was as required by Ms Marsh and she did send a couple of text messages to Ms Marsh about the issue;22 it was Linda who argued with John and told him he was not Jewish;23 a resident did not refuse to come to dinner on Saturday nights;24 the matters raised by Areltte were not true with respect to Maxine or Tola;25 and she did not tell Arlette that she (Ms Kerry) was going to leave and would tell Ms Marsh and other staff what she thought of them and the residents.26

[49] With respect to the resident Linda, Ms Kerry says that Linda would occasionally go into the kitchen but she was not the type of person you could tell to do anything and she couldn’t physically remove her from the kitchen. She says that Linda was not in the kitchen ‘every single minute of every single day, 27 that she and Linda were not in the kitchen eating the facilities’ food late at night28 and Ms Marsh did not raise this issue with her.29 Ms Kerry also says that Linda was only in the office once when she took off her TED stockings but she did not allow Linda to look in the day book or folders.30 She notified Ms Marsh of this incident31 but Ms Marsh did not raise this issue with her.32

Findings as to conduct

[50] Whilst I accept that Ms Marsh has accurately represented what the residents have said to her with respect to Ms Kerry, it is not evidence that can be relied on to make a finding that the conduct complained of with respect to Ms Kerry occurred.

[51] None of the residents gave evidence and the best evidence is that, in some cases, an official complaint was logged in the complaints book.

[52] Further, in some of the complaints about Ms Kerry, the complaint was made by a resident with respect to what had apparently transpired between Ms Kerry and a third resident.

[53] This is not to suggest that Ms Kerry has played no role in the matters that have clearly arisen at Caulfield House. At least on 5 June 2016 she complained of the ‘laziness and bitchiness’ of other staff, suggesting she did have issues with staff.

[54] The only exception I make to this general view is with respect to Linda being in the kitchen or office. This is the only alleged conduct that Ms Kerry did not deny. Rather, she sought to deflect it by suggesting that it wasn’t as if Linda had been in the kitchen every minute of every day. With respect to the office, Ms Kerry’s response was that she had told Ms Marsh when Linda was in the office as she was taking off her stockings. Ms Kerry, however, again avoided the direct issue of allowing Linda in the office. Given Ms Kerry’s emphatic denials of all other conduct complained of her, her response with respect to Linda suggests that she did allow Linda into the kitchen and the office.

[55] I am therefore satisfied that Ms Kerry did allow Linda into the kitchen and the office. I am satisfied that she was made aware that Linda was not to go into those areas but that she ignored the instruction.

[56] With respect to the conduct I have found did occur (with respect to Linda) I am not satisfied that this provided a valid reason for dismissal. Whilst the conduct was not appropriate and Ms Kerry had been told that Linda was not to go into the kitchen or office and the reasons, in particular, as to why she was not to go into the office (that went to the privacy of other residents), the conduct could not be described as so egregious that it provides a valid reason for dismissal.

If the person was notified of the reason (s.387(b))

[57] Ms Kerry was advised of the reason for dismissal only in the text message sent to her on 6 June 2016 advising her that her employment had been terminated.

An opportunity to respond (s.387(c))

[58] Ms Kerry was not given an opportunity to respond to the reasons for her dismissal.

[59] I accept that Ms Marsh attempted to meet with Ms Kerry on 3 June 2016 by sending a text to her. Not having received a response however she indicated some concerns in a text message on that day. She then proceeded to terminate Ms Kerry’s employment three days later with no further attempt to meet and discuss the issues of concern with her.

Support person (s.387(d))

[60] As no meeting was held with Ms Kerry this is not a relevant consideration.

Unsatisfactory performance (s.387(e))

[61] Ms Kerry’s employment was not terminated for reasons related to performance.

The impact of the size of the employer’s enterprise and access to human resource expertise (ss.387(f) and (g))

[62] Caulfield House is a small business. It is apparent that it has no specialist human resources staff. The evidence of Ms Marsh is that this is the first time she has had to dismiss an employee.

[63] The size of the business and the lack of access to human resource expertise is not, of itself, an adequate reason to fail to abide by the basic principles of procedural fairness. The specific concerns with respect to Ms Kerry’s conduct should have been put to her and she should have been given an opportunity to respond to those concerns and adjust her conduct. Further, a meeting should have been held and Ms Kerry given an opportunity to respond to the reasons for the dismissal prior to a final decision being made. There is no evidence to suggest that this occurred.

[64] The size of the business and lack of access to human resource expertise may well provide some basis to excuse deficiencies in the process undertaken but in this case those deficiencies are too great to be lightly put aside.

Any other matters (s.387(h))

[65] No other matters have been put to me that I should consider.

Conclusion

[66] For all of the reasons given I am satisfied that the dismissal was unjust because there was no valid reason for dismissal. Even if the conduct of Ms Kerry with respect to Linda did provide a valid reason for dismissal I would consider the dismissal to be harsh because the gravity of the decision to terminate Ms Kerry’s employment is disproportionate to the misconduct.

[67] For all of the reasons given I am satisfied that Ms Kerry was unfairly dismissed.

Remedy

[68] Section 390 of the Act states:

390 When the FWC may order remedy for unfair dismissal

(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of compensation to a person, if:

(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and

(b) the person has been unfairly dismissed (see Division 3).

(2) The FWC may make the order only if the person has made an application under section 394.

(3) The FWC must not order the payment of compensation to the person unless:

(a) the FWC is satisfied that reinstatement of the person is inappropriate; and

(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.

Note: Division 5 deals with procedural matters such as applications for remedies.

[69] By virtue of the operation of s.390(3)(a) it is apparent that I must first consider if reinstatement is appropriate.

[70] Ms Kerry seeks reinstatement. Caulfield House opposes the reinstatement. Ms Marsh says that she does not trust Ms Kerry to be around residents on the basis of the incidents and complaints made by her.

Consideration

[71] Caulfield House is a small residential unit for 30 elderly people. It has a small contingent of staff (less than 15) who provide care and support to the residents 24 hours a day.

[72] Ms Marsh, the Managing Director, is in attendance at Caulfield House 3 days per week for about 28 hours in total. It is apparent that she relies on her staff to maintain the standard of care expected and see to the needs of the residents. Whilst no specific submissions or evidence was given to this effect, I accept that she relies on her staff working together in a cooperative and harmonious manner. It is clear from Ms Marsh’s evidence that friction amongst the staff that she observed at the time she terminated Ms Kerry’s employment was not common but was of some concern to her.

[73] I am satisfied that Ms Marsh must have confidence in all of her staff and that, given the small size of Caulfield House, it is difficult to have in its employ a person who does not have that full confidence. I am further satisfied that, given the views expressed to Ms Marsh by residents, it is reasonable that Ms Marsh has concerns about the reinstatement of Ms Kerry. Whether the residents are right or wrong in the views they have expressed of Ms Kerry is not to the point, these are their views and they must be afforded some respect. These are not clients of the business who might have some intermittent interaction with staff but are residents who are being cared for on a full time basis. Whilst I accept that only a small number of residents have complained of Ms Kerry this must be taken into account in deciding if reinstatement is inappropriate.

[74] I am mindful that the work Ms Kerry seeks to return to involves looking after vulnerable elderly people. In such circumstances and given the size of the establishment I am satisfied that it is inappropriate that Ms Kerry be reinstated.

[75] It is therefore necessary that I consider compensation.

[76] Section 392 of the Act 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.

(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.

[77] I am satisfied that any order I will make will not adversely affect the viability of Caulfield House (s.392(2)(a)).

[78] Ms Kerry worked at Caulfield House from May 2013 until June 2016 (s.392(2)(b)). She submits that I should determine compensation on the basis that her employment would have continued indefinitely.

[79] I am not satisfied that Ms Kerry’s employment would have continued indefinitely. Such a conclusion would require me to ignore the evidence before me of the apparent tensions that had developed in the workplace and of attempts by Ms Marsh to have a meeting with Ms Kerry on 3 June 2016 to speak to her of these matters.

[80] Ms Marsh did make Ms Kerry aware of issues that had arisen with the residents that she did wish to address with her, albeit briefly in the text message of 3 June 2016.

[81] I do acknowledge however that Ms Kerry was keen to keep her job and was reliant on the income she received. 33 Ms Kerry was apparently aware of the need to change her rostered days. She indicated in her reply to Ms Kerry on 3 June 2016 that she would no longer work Saturdays if it helped keep her out of trouble. She also indicated in those text messages that she had been unhappy ‘on occasions’ and had felt ‘unsupported’. She indicated she would ‘pull her socks up.’34

[82] Taking all of this into account I am satisfied that Ms Kerry would have remained in employment with Caulfield House for no more than a further four months. There were developing tensions and there were issues with respect to her conduct that were to be addressed by Ms Marsh. I am satisfied that these matters would have come to a conclusion in some fashion within four months.

[83] I am satisfied that while Ms Kerry indicated she was prepared to do some swapping of shifts so she no longer worked on Saturday this was not finalised prior to the termination of her employment. I am not prepared to assume that her shift pattern would have changed for the purposes of determining lost remuneration.

[84] Ms Kerry provided some time sheets 35 and evidence of deposits into her bank account.36 She says that I can rely on these and that her weekly earnings were $561.20.

[85] On the basis of the evidence presented by Ms Kerry of pay deposits into her bank account it appears that her earnings varied from week to week. Her evidence of deposits into her bank account shows a low amount of $311.26 and a high amount of $692.57. The final payment made to her was for $561.26 on 11 June 2016 but this appears to be a termination payment.

[86] In determining the remuneration Ms Kerry would have received had her employment not been terminated I have decided to use the average of her last three ‘normal’ pays (i.e. excluding the termination pay). This average is $519.61 per week. Her lost remuneration is therefore (519.61 x 17 =) $8,833.37 plus superannuation. I have reduced this amount by 20% for contingencies. I reduce it by this amount as it appears that there may have been some shift changes about to be agreed to by Ms Kerry and for the normal exigencies. Her lost remuneration is therefore $7,066.70 plus superannuation (s.392(2)(c)).

[87] Between the termination of her employment and the hearing of her application (some 13 weeks) Ms Kerry had applied for eight positions, primarily in disability care work. I am satisfied that Ms Kerry has made appropriate efforts to mitigate her loss (s.392(2)(d)).

[88] Whilst Ms Kerry has continued to earn approximately $175.00 per week from her job as a nanny, this is work that she had whilst working for Caulfield House. I have therefore not reduced her lost remuneration by this amount (s.392(2)(e)). For the same reason I will not consider this amount in any remunerations Ms Kerry may be likely to earn between the making of the order for compensation and the payment of such compensation (s.392(2)(f)).

[89] I have decided to further reduce the amount I would otherwise order in compensation by 10% for misconduct. It is not necessary that the misconduct provide a valid reason for dismissal to be considered as a basis for a reduction in compensation. This recognises the conduct I found occurred with respect to Linda (s.392(3)).

[90] I have not included any amount for shock or distress (s.392(4)).

[91] The amount I shall order does not exceed the compensation cap.

Conclusion as to compensation

[92] I shall therefore order that Caulfield House pay to Ms Kerry an amount of $6,360.03 plus superannuation. As I have found that Ms Kerry was an employee of Caulfield House this amount should be taxed appropriately. I shall also order that the amount be paid within 21 days of the making of the order.

COMMISSIONER

Appearances:

G. Dircks for the Applicant

J. Marsh for the Respondent

Hearing details:

2016

Melbourne

6 September

Final written submissions:

Applicant: 19 August 2016

Respondent: 12 August 2016

 1 (2011) 206 IR 252.

 2   Ibid, [208].

 3   See Abdalla v Viewdaze Pty Ltd t/a Malta Travel (2003) 122 IR 215, [34].

 4   Exhibit A2, paragraph 29.

 5   Transcript PN 161-82.

 6   Exhibit R2.

 7   Exhibit R2 and Transcript PN 327-42.

 8   [2015] FWCFB 5264, [41].

 9   Exhibit A1, attachment VK 7.

 10   Transcript PN256-7. See also exhibit R1, attachment D.

 11   Transcript PN381-5.

 12   Transcript PN424-5.

 13   Exhibit R1, paragraph 16 and attachment F.

 14   Exhibit R1, paragraph 22 attachment H.

 15   Exhibit R1, paragraph 17

 16   Transcript PN259-60.

 17   Transcript PN259.

 18   Exhibit R1, paragraph 15.

 19   Transcript PN73.

 20   Transcript PN74-5.

 21   Transcript PN76.

 22   Transcript PN82-3.

 23   Transcript PN87.

 24   Transcript PN 91.

 25   Transcript PN99-102.

 26   Transcript PN97.

 27   Transcript PN77.

 28   Transcript PN81.

 29   Transcript PN95.

 30   Transcript PN78-80.

 31   Transcript PN93.

 32   Transcript PN94

 33   As a result of a request of the Commission Ms Kerry provided copies of text messages between her and Ms Marsh from 3 June 2016.

 34   Ibid.

 35   Exhibit A1, attachment VK-1 and VK-2.

 36   Exhibit A2, attachment VK-9.

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