Whelan v Cigarette & Gift Warehouse Pty Ltd
[2017] FCA 1534
•19 December 2017
FEDERAL COURT OF AUSTRALIA
Whelan v Cigarette & Gift Warehouse Pty Ltd [2017] FCA 1534
File number: QUD 987 of 2015 Judge: COLLIER J Date of judgment: 19 December 2017 Catchwords: INDUSTRIAL LAW – alleged contraventions of s 340(1) Fair Work Act 2009 – whether there was a workplace right – whether complaint or inquiry about bonuses is a workplace right – whether complaint or inquiry about request to a third party is a workplace right - whether workplace right was exercised or proposed to be exercised – whether applicant was discriminated against - whether exercise of workplace right was a substantive or operative reason for dismissal – where decision maker gave no direct testimony in the proceedings – whether second respondent involved in the contravention
INDUSTRIAL LAW – alleged contravention of ss 44(1) and 117 Fair Work Act 2009 – refusal to pay statutory entitlements – evidence that entitlements deliberately withheld – whether second respondent involved in contravention
CONSUMER LAW – alleged contravention of s 31 Australian Consumer Law – whether misleading representations were made during offer of employment –whether alleged representations were reasonable
CONTRACTS – contract of employment - whether term of good faith and reasonableness was implied in contract – whether contract breached by failing to pay bonuses and commissions – whether contract breached by failing to set budget targets – whether contract breached for failing to provide additional incentive bonus
CONTRACTS – cross claim – whether payment to applicant was a loan or advance– whether payment was a discretionary bonus
COMPENSATION – claim for loss of opportunity to work for first respondent – whether employment would have continued - claim for loss of opportunity to work at former employer – claim of non-economic loss for hurt and humiliation - whether post dismissal actions of employer are relevant to compensation
Legislation: Competition and Consumer Act 2010 (Cth) Sch 2, Australian Consumer Law ss 4, 31, 224, 236
Fair Work Act 2009 (Cth) ss 44, 44(1), 90, 90(2), 117, 117(2), 324(1), 340, 340(1), 341(c)(ii), 341(c)(iii), 342(1), 342(1)(c), 342(1)(d), 352, 360, 361, 361(1), 545, 545(1), 545(2)(b), 546, 546(3)(c), 547, 550, 550(1), 550(2)
Federal Court of Australia Act 1976 (Cth) ss 51A, 51A(1)
Trade Practices Act 1974 (Cth) s 53B (repealed)
Trade Practices Amendment (Australian Consumer Law) Bill (No. 2) 2010 Explanatory Memorandum
Interest on Judgments Practice Note (GPN-INT)
Cases cited: Armco (Aust) Pty Ltd v Federal Commissioner of Taxation [1948] HCA 49; (1948) 76 CLR 584
Australian Licenced Aircraft Engineers Association v International Aviation Service Assistance Pty Ltd [2011] FCA 333; (2011) 193 FCR 526
Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500
BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266
Chappel v Hart [1998] HCA 55; (1998) 195 CLR 232
Commonwealth Bank of Australia v Barker [2014] HCA 32; (2014) 253 CLR 169
Concrete Constructions Group v Litevale Pty Ltd [2002] NSWSC 670; (2002) 170 FLR 290
Construction, Forestry, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd [2015] FCAFC 157; (2015) 238 FCR 273
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 Director of the Fair Work Building Industry Inspectorate [2012] FCAFC 178; (2012) 209 FCR 448
David Walker v Salomon Smith Barney Securities Pty Limited [2003] FCA 1099; (2003) 140 IR 433
Doppstadt Australia Pty Ltd v Lovick & Son Developments Pty Ltd [2014] NSWCA 158
Esso Australia Resources Pty Ltd v Southern Pacific Petroleum NL [2005] VSCA 228
Fair Work Ombudsman v Centennial Financial Services Pty Ltd [2010] FMCA 863; (2010) 245 FLR 242
Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365
General Newspapers Pty Ltd v Telstra Corporation (1993) 45 FCR 164
Hanave Pty Ltd v LFOT Pty Ltd [1999] FCA 357; (1999) 43 IPR 545
Lai v Chance Trading Pty Ltd [2015] FCCA 441
London Financial Association v Kelk (1884) 26 ChD 107
Maritime Union of Australia v Fair Work Ombudsman [2015] FCAFC 120
McGrath; in the matter of Pan Pharmaceuticals Ltd (in liq) v Australian Naturalcare Products Pty Ltd [2008] FCAFC 2; (2008) 165 FCR 230
McIlwain v Ramsey Food Packaging Pty Ltd (No 4) [2006] FCA 1302; (2006) 158 IR 181
Murrihy v Belezy.com.au Pty Ltd [2013] FCA 908; 238 IR 307
Perez v Northern Territory Department of Correctional Services [2016] FCA 476
Razdan v Westpac Banking Corporation [2014] NSWCA 126
Richardson v Oracle Corporation Australia Pty Ltd [2014] FCAFC 82; (2014) 223 FCR 334
Rosenberg v Percival [2001] HCA 18; (2001) 205 CLR 434
Shahid v The Australasian College of Dermatologists [2007] FCA 693; (2007) 72 IPR 555
Shea v TRUenergy Services Pty Ltd (No 6) [2014] FCA 271; (2014) 242 IR 1
Silverbrook Research Pty Ltd v Lindley [2010] NSWCA 357
State of Victoria (Office of Public Prosecutions) v Grant [2014] FCAFC 184; (2014) 246 IR 441
Sykes v Reserve Bank of Australia [1998] FCA 1405; (1998) 88 FCR 511
Tattsbet Limited v Morrow [2015] FCAFC 62; (2015) 233 FCR 46
Walsh v Greater Metropolitan Cemeteries Trust (No 2) [2014] FCA 456; 243 IR 468
Creighton WB, Creighton and Stewart’s Labour Law (6th ed, Federation Press, 2016)
Lockhart C, The Law of Misleading or Deceptive Conduct (4th ed, LexisNexis, 2014)
Date of hearing: 14-17 March 2017, 8 May 2017 and 23 May 2017 Registry: Queensland Division: Fair Work Division National Practice Area: Employment & Industrial Relations Category: Catchwords Number of paragraphs: 329 Counsel for the Applicant: Mr E White Solicitor for the Applicant: Adams Wilson Lawyers Counsel for the Respondents: Mr P Roney QC with Mr G Dietz Solicitor for the Respondents: Nyst Legal ORDERS
QUD 987 of 2015 BETWEEN: ANDREW WHELAN
Applicant
AND: CIGARETTE & GIFT WAREHOUSE PTY LTD ACN 055 030 567
First Respondent
TRAVERS BEYNON
Second Respondent
JUDGE:
COLLIER J
DATE OF ORDER:
19 DECEMBER 2017
THE COURT DECLARES THAT:
1.The first respondent contravened:
(a)section 340(1) of the Fair Work Act 2009 (Cth) (FW Act) by taking adverse action against the applicant;
(b)section 44(1) of the FW Act by failing to provide payment in lieu of notice for termination in accordance with s 117(2) of the FW Act; and
(c)section 44(1) of the FW Act by failing to pay the applicant amounts owing to him on termination with respect to unused paid annual leave in accordance with s 90(2) of the FW Act.
2.The second respondent was involved in the first respondent’s contraventions identified in paragraph 1 of these Orders.
THE COURT ORDERS THAT, WITHIN 30 DAYS OF THIS ORDER:
3.Pursuant to s 545 of the FW Act, the respondents pay the applicant the sum of $17,625.72 in lieu of notice.
4.Pursuant to s 545 of the FW Act, the respondents pay the applicant the sum of $17,160.40 for untaken but accrued annual leave.
5.Pursuant to s 545 of the FW Act, the respondents pay the applicant the sum of $5,000 in compensation for non-economic loss.
6.Pursuant to s 547 of the FW Act, the respondents pay the applicant interest on the compensation awarded in paragraphs 3, 4 and 5 of these Orders, such interest to be calculated from 24 August 2015 until the date of judgment in accordance with the Interest on Judgments Practice Note (GPN-INT) issued 18 September 2017.
AND THE COURT FURTHER ORDERS THAT:
7.The amended notice of cross-claim filed on 11 October 2016 be dismissed.
8.The applicant and respondents file submissions in respect of costs and quantum of penalties by a date to be fixed.
9.The matter be listed for hearing in respect of costs and quantum of penalties at a date to be fixed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
COLLIER J:
Pursuant to an originating application filed on 26 October 2015 the applicant, Mr Whelan, seeks orders against his former employer (the first respondent) and the managing director of the first respondent (Mr Beynon) by way of declarations and orders for the payment of his entitlements, pecuniary penalties, and compensation. Mr Whelan alleges contravention of the Fair Work Act 2009 (Cth) (FW Act), breach of the terms of his employment contract, and contravention of the Australian Consumer Law (ACL) contained in Sch 2 of the Competition and Consumer Act 2010 (Cth), by the first respondent, with Mr Beynon an accessory to those contraventions.
Mr Whelan claims that he was the subject of various forms of adverse action by the first respondent, including summary dismissal on 24 August 2015, after he exercised workplace rights. These workplace rights were complaints or inquiries in relation to a bonus or bonuses to which he was entitled and his refusal to ask his wife to sign a non-disclosure agreement as requested by the first respondent. Mr Whelan claims further that he was not paid accrued but untaken but accrued leave or salary in lieu of notice, and that this breached the FW Act. He also claims that prior to his commencement of employment with the first respondent various representations were made to him concerning his employment, and those representations were terms of his employment. Mr Whelan’s contractual claims also include alleged breach of a term of good faith and reasonableness in relation to the payment of discretionary bonuses by the first respondent.
The proceedings were complicated by a number of factors. Mr Whelan’s pleaded case progressed through several iterations, and he ultimately relies on a third further amended statement of claim filed on 10 March 2017. Mr Beynon was added as a second respondent on 29 February 2016. The first respondent is also known as “Freechoice”, although there is actually a separate related company known as Freechoice Vending Australia Pty Ltd (Freechoice Vending). Although Mr Whelan’s claims arose from his employment, his case was not limited to proceedings under the FW Act, but extended to claims under contract and the ACL. The first respondent filed a cross-claim, and subsequently an amended notice of cross-claim, seeking from Mr Whelan the sum of $70,000 as a debt due and owing, or alternatively restitution in the sum of $70,000 plus interest. Unsavoury personal allegations were made at various times during the proceedings by various witnesses against others. Recordings of conversations and activity involving Mr Whelan were secretly made by the respondents, sought to be tendered by them, and – in respect of material which were admitted to evidence – relied on by them. Despite orders requiring the parties to file a joint statement of agreed facts and issues for decision, the parties seemed unable to agree on basic matters, and filed separate statements.
The proceedings were notable for the identity – and absence – of witnesses who were prepared or able to give evidence. Mr Whelan gave evidence in support of his case, as did Ms Parnia Marshall (who identified herself as a “promotional model goddess for The Candy Shop Mansion” employed by the first respondent from May to November 2015). In support of the respondent’s case, evidence was given by Ms Suzanne Ozioko (the National Human Resources and Operations Manager employed by the first respondent), Mr Daniel Hains (an expert forensic accountant with Vincents Chartered Accountants), and Mr Rajesh Lal (the Group Financial Controller for the FreeChoice Australia corporate group). Curiously for proceedings of this nature, the day that he was due to be called as a witness and for unexplained reasons, Mr Beynon’s representatives told the Court he had chosen not to give evidence in the proceedings. This was surprising in circumstances where, in light of s 361 of the FW Act, the onus of proof in claims of adverse action proceedings may shift to the employer, and it is usual for the decision-maker in such proceedings to give evidence.
Background
Despite the apparent inability of the parties to agree on a joint statement of facts and issues in contention, there is some common ground between the parties as to background facts.
The first respondent carries on a business of providing services in the cigarette and gift supply industry by way of franchising. Mr Beynon has been the Managing Director of the first respondent since at least June 2014. He appears to be the public face of the first respondent, and is involved in marketing its business by staging publicity associated with a public persona he has created (I understand that Mr Beynon promotes himself as “The Candyman” and his residence at the Gold Coast as “The Candy Shop Mansion”).
Mr Whelan claims that Mr Beynon is the person who exercised full managerial control of the first respondent’s business and had the primary responsibility for, and control of, that business. The respondents deny this aspect of Mr Whelan’s claim. However the respondents do admit that, at relevant times and for the purposes of s 793(1) of the FW Act, Mr Beynon was the person whose state of mind (in respect of the conduct referred to in Mr Whelan’s claim) was the state of mind of the first respondent. In my view this is incontrovertible.
Mr Whelan was employed as the National Sales Manager of the first respondent from around 6 June 2013 to 10 November 2013, and General Manager from 11 November 2013 until 24 August 2015. Prior to his employment with the first respondent, Mr Whelan was employed by an entity he described in evidence as British American Tobacco (Aust) (BATA). Mr Whelan met Mr Beynon on a number of occasions, and in May 2013 Mr Beynon, on behalf of the first respondent, offered Mr Whelan the role of National Sales Manager with the first respondent.
The parties agree that the salary proposed by Mr Beynon at that time was $205,000 per annum. There is some dispute between the parties about bonuses. Mr Whelan claims that the salary was the sum of $205,000 “plus bonuses” whereas the respondents claim that Mr Beynon offered the sum of $205,000 “with the option of a bonus structure”. Mr Whelan also claims that Mr Beynon also offered him $5,000 to assist him to relocate from Sydney to the Gold Coast. This is denied by the respondents, although nothing appears to rest on this issue.
Mr Whelan claims that, at a business lunch in Sydney in May 2013, Mr Beynon made various representations to him, upon which Mr Whelan relied and in so doing accepted an offer of employment with the first respondent. The respondents deny that Mr Beynon said words to the effect claimed by Mr Whelan, or that Mr Beynon made the representations claimed by Mr Whelan.
It is, however, common ground that Mr Whelan accepted employment with the first respondent on 6 June 2013, and that he signed an employment agreement on or about that date.
The terms of Mr Whelan’s employment were subsequently amended, in writing. It is common ground that, on or about 12 November 2013, Mr Whelan received a letter from Mr Beynon on behalf of the first respondent, promoting him to “General Manager”, and amending his terms and conditions of employment to increase his annual salary to $230,000 (backdated to 6 June 2013) and paying him superannuation at a rate of 9.25% per annum. On 17 January 2014, Mr Whelan’s salary was increased to $309,586.
So far as concerns his work performance, Mr Whelan claims that his actions resulted in the first respondent’s profit increasing from $2.7 million to $6.4 million in the financial year ending 30 June 2014, and that as a result he was paid a bonus of $100,000 in or about September 2014. He further claims that his actions resulted in the first respondent’s profit increasing from $6.4 million to $10.4 million in the financial year ending 30 June 2015, but that he was not paid a bonus in respect of this performance, and that the first respondent failed or refused to pay him a bonus.
The respondents dispute these allegations. They say that the combined net profits before income tax of the first respondent and Freechoice Vending were approximately $2.75 million for the financial year ending 30 June 2013, and $6.4 million for the financial year ending 30 June 2014. The respondents claim that the increase in the combined net profits of the first respondent and Freechoice Vending was attributable to the first respondent and Freechoice Vending signing a new national supply agreement with United Petroleum Pty Ltd, anagreement neither negotiated nor finalised by Mr Whelan. The respondents admit that Freechoice Vending (on behalf of the first respondent) paid Mr Whelan the sum of $100,000 as a bonus for the financial year ended 30 June 2014, but say that this was because the joint net profit before tax of the first respondent and Freechoice Vending for the financial year ending 30 June 2014 had exceeded $6 million. Mr Whelan disputed this characterisation, claiming that he was responsible for securing this national supply agreement, and in any event the bonus scheme in his employment contract was conditional upon the attainment of budget targets rather than specified events.
Mr Whelan’s wife, Mrs Tracey Whelan, was employed by the first respondent as a Key Accounts Communications Manager on 19 November 2013. Mrs Whelan resigned in February 2015.
The respondents allege that, on 13 November 2014, Mr Whelan requested Mr Beynon to loan him the sum of $70,000 to enable Mr Whelan to purchase a boat. The respondents claim further that Mr Beynon agreed (on behalf of the first respondent) to pay Mr Whelan the sum of $70,000 as an advance on future entitlements payable under the employment contract, and on this basis the first respondent paid the money to Mr Whelan. Mr Whelan denies this allegation – rather he claims that the sum of $70,000 (gross) was a discretionary bonus offered by Mr Beynon in or about the first week of November 2014 and paid to him in December 2014.
The respondents allege that on 23 June 2015, Mr Whelan breached cl 10.1 of his employment contract by disclosing confidential information to a third party without the first respondent’s consent. Specifically, the respondents allege that Mr Whelan emailed Ms Chanel Stewart (also referred to as “Chanel Spencer”) a promotional editorial concerning Mr Beynon which was to appear in a future edition of Zoo Magazine, and not in the public domain at that time. I understand that Ms Stewart was a promotional model who had participated in the photo shoot which was featured in that promotional editorial. Mr Whelan admitted sending Ms Stewart the email, but denied that the information was confidential or that he was not authorised by Mr Beynon to send Ms Stewart the email.
Mr Whelan alleges that on or about 24 August 2015 he met with Mr Beynon, and asked why he had not been paid a bonus equivalent to one hundred percent of his annual salary in light of the financial performance of the first respondent. Mr Whelan claims that he also inquired at this time about a plan for the payment of a bonus in respect of the current financial year. Mr Whelan claims that Mr Beynon denied he was entitled to a bonus. The respondents deny that Mr Whelan made this bonus request, say that there was no discussion of bonuses at the meeting, and say further that the first respondent was not liable to pay Mr Whelan the bonus he alleged was his entitlement.
Mr Whelan alleges that he received no warning of poor or unacceptable performance of his employment duties, and received no counselling by the respondents in relation to any misconduct during his employment. The respondents disputed this, pleading that:
·An oral warning was given by Mr Beynon to Mr Whelan in or around late June 2015 concerning Mr Whelan’s behaviour and work ethic whilst on a business trip to Europe;
·An oral warning was given by Mr Beynon to Mr Whelan on 17 July 2015 concerning the failure of Mr Whelan to perform in his role to the standard expected of him by the first respondent, and Mr Whelan acknowledged this warning in an SMS sent by him to Mr Beynon on the same date; and
·An oral warning was given by Mr Beynon to Mr Whelan on 24 July 2015 concerning Mr Whelan’s (alleged) failure to perform in his role to the standard expected of him by the first respondent.
It is common ground that on or about 24 August 2015, Mr Whelan met with Ms Suzanne Ozioko, and Ms Ozioko asked Mr Whelan to arrange for his wife to sign a non-disclosure agreement relating to the first respondent’s business. Mr Whelan claims he asked if partners of other employees were required to sign a similar agreement, and was informed by Ms Ozioko that they were not. Mr Whelan did not arrange execution of the agreement by Mrs Whelan. The respondents concede that Mr Whelan was not legally obliged to carry out this task.
The respondents however dispute Mr Whelan’s claim that Mr Beynon subsequently rang him and told him that if Mrs Whelan did not sign the non-disclosure agreement, Mr Whelan’s position would be terminated.
It is common ground that Mr Whelan’s employment was terminated without notice and in writing by the first respondent on 24 August 2015, on the ground of breach of confidentiality.
In their further amended defence filed 9 March 2017, the respondents pleaded additional allegations concerning Mr Whelan’s work performance. The respondents plead that Mr Whelan’s employment was also terminated for, in summary:
·Lack of fidelity to Mr Beynon about Mr Whelan’s involvement in the disclosure of information to Ms Stewart, and having disclosed it;
·Lack of fidelity to Ms Ozioko about the fact that Mr Whelan had told Mr Beynon, during the course of a business trip to Europe, to “fuck off” when in fact Mr Whelan had not done so, and lying to Mr Beynon about it;
·A lack of trust on the part of Mr Beynon in Mr Whelan’s ability to continue to act as General Manager given Mr Whelan’s inability to manage his own financial affairs, which was discussed by them during the course of the of 24 August 2015 meeting;
·Failure to act with fidelity in his dealings on 24 August 2015 with Mr Beynon;
·Failure to comply with Mr Beynon’s oral instruction given earlier on 24 August 2015 not to leave the office before 5.00 pm that day and to attend a meeting with Mr Beynon that afternoon, by leaving the office before that time, and then failed to answer or return phone calls made to his mobile phone by Mr Beynon;
·The prospect that Mr Whelan would imminently resign from employment with the first respondent and act contrary to its interests by disclosing confidential information.
The respondents also plead at paragraphs 39(c)(iB) and (iC) of the further amended defence that on 24 August 2015, Mr Whelan had already decided he was resigning, had physically removed documents from the first respondent and forwarded documents to his wife by text message, and had downloaded a complete copy of the laptop with which he had been provided by the first respondent. The respondents claim that Mr Whelan’s employment was terminable by the first respondent at will pursuant to cl 9.1 of the employment contract and had the first respondent been aware of the matters pleaded in paragraphs 39(c)(iB) and (iC) it would have been entitled to terminate Mr Whelan’s employment and would have done so.
Summary of Mr Whelan’s claims
Mr Whelan’s claims as set out in his third further amended statement of claim can be summarised as follows:
(1)The first respondent took adverse action against him by:
(a)refusing to pay him the bonus to which he was entitled (paragraph 41(a));
(b)requiring his wife to sign a non-disclosure document which partners of other staff were not required to sign (paragraph 41(a)); and
(c)dismissing him from his employment (paragraph 41(b));
(2)The reason the first respondent took the adverse action was because:
(a)Mr Whelan had a workplace right to make complaints or inquiries concerning his unpaid bonus and/or the plan whereby that bonus would be calculated, and the first respondent’s request concerning Mrs Whelan’s execution of a confidentiality agreement; and/or
(b)Mr Whelan had exercised that workplace right (paragraph 42);
(3)Mr Whelan’s contract of employment with the first respondent was partly written and partly implied (paragraph 18), namely:
(a)It was written to the extent of an employment agreement signed by Mr Whelan on or about 6 June 2013; and
(b)It included a term of good faith and reasonableness in the performance of obligations and exercise of rights in the employment contract which was implied by law. This included a reasonable expectation of him receiving a share of the first respondent’s profits in accordance with his contract by way of discretionary bonus (paragraph 58);
(4)The first respondent breached various clauses of the contract of employment, namely:
(a)Clause 2.3 (1.0) – by failing to pay Mr Whelan bonuses and commissions for the financial year ending 30 June 2015 (paragraph 44);
(b)Clause 2.3 (2.0) – by failing to pay Mr Whelan an incentive bonus in the financial years ending 30 June 2014 and 30 June 2015 (paragraph 45);
(c)Clause 2.3 (3.0) – by failing to set the first respondent’s budget prior to the 2014-2015 financial year, which was a deliberate attempt by the first respondent to prevent Mr Whelan from obtaining a bonus (paragraphs 46-48);
(d)Clause 2.3 (4.0) – by failing to provide an additional incentive bonus in the financial years ending June 2014 and June 2015 (paragraph 49);
(e)Clause 1.5 – by failing to pay Mr Whelan untaken paid annual leave upon termination of his employment (paragraph 51). Mr Whelan claims further that the failure to pay him unused annual leave on termination constituted a breach of s 44(1) of the FW Act by reason of s 90(2) of that legislation; and
(f)Clause 9.1 – by failing to provide Mr Whelan with three weeks’ notice of termination or payment in lieu of notice (paragraph 52). Mr Whelan claims further that this failure constituted a contravention of s 117(2) of the FW Act;
(5)Mr Beynon was involved in the first respondent’s adverse action in contravention of ss 340(1), 117(2) and 90(2) of the FW Act (paragraphs 68-71);
(6)Mr Beynon’s words to him at a business lunch in around May 2013 were representations concerning employment, were relied on by Mr Whelan, and were unwritten terms of his employment. Mr Beynon’s conduct was also properly characterised as liable to mislead Mr Whelan as to the nature, terms or conditions of employment (namely his prospects of career advancement and his security of employment) and thus constituted a contravention of ss 4 and 31 of the ACL (paragraphs 60-64);
(7)Mr Beynon aided and abetted the first respondent, and/or was directly or indirectly knowingly concerned in the contravention of s 31 of the ACL by the first respondent (paragraph 66);
(8)Mr Whelan has suffered future economic loss, non-economic loss and past economic loss (paragraphs 72-78); and
(9)Contrary to the cross-claim of the respondents, the $70,000 advanced to Mr Whelan was not a loan, but was an advance on the bonus to which he was entitled.
Specifically, Mr Whelan seeks the following relief:
(1)Declarations that the first respondent contravened:
(a)Section 340(1) of the FW Act by taking adverse action against Mr Whelan;
(b)Section 44(1) of the FW Act by failing to provide payment for notice in lieu of termination in accordance with s 117(2) of the FW Act; and
(c)Section 44(1) of the FW Act by failing to pay Mr Whelan amounts owing to him on termination with respect to unused paid annual leave in accordance with s 90(2) of the FW Act;
(2)A declaration that Mr Beynon was involved in the first respondent’s contraventions of the FW Act;
(3)An order pursuant to s 545(2)(b) of the FW Act that the respondents pay compensation to Mr Whelan for the contraventions of the FW Act;
(4)An order pursuant to s 546 of the FW Act requiring the respondents to pay a pecuniary penalty for breach of the contraventions of the FW Act;
(5)An order that any penalties imposed by the Court be paid within 30 days of the order for payment;
(6)An order pursuant to s 546(3)(c) of the FW Act requiring any penalty or penalties imposed on the respondents be paid to Mr Whelan;
(7)Further or alternatively, the respondents pay Mr Whelan damages for breach of contract (to be assessed);
(8)Further or alternatively, the respondents pay Mr Whelan damages to be assessed pursuant to s 236 of the ACL;
(9)Further, an order pursuant to s 224 of the ACL that the respondents pay a pecuniary penalty for contravening s 31 of the ACL;
(10)Interest pursuant to s 51A(1) of the Federal Court of Australia Act 1976 (Cth) on any judgment for compensation or damages; and
(11)Costs.
The respondents set out detailed defences to these claims in their further amended defence.
Adverse action claim against the first respondent
Section 340(1) of the FW Act provides:
(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.
Recently in Perez v Northern Territory Department of Correctional Services [2016] FCA 476 White J summarised principles relevant to an application for relief referable to s 340(1), in the following terms:
51As noted, s 340(1) requires that there be a causal link between the taking of the adverse action, on the one hand, and the person’s possession, exercise, or proposed exercise, of a workplace right, on the other. Section 361 has the effect of placing the onus of disproving the causal link on the respondent. At the relevant time, s 361(1) provided:
(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, in proceedings arising from the application, that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
52Put broadly, an adverse action claim involves three elements:
(1)a person has a workplace right, has exercised such a right, or proposes to exercise such a right;
(2)the respondent took “adverse action” of the kind defined in s 342 against that person;
(3)the respondent took the adverse action because of the possession, exercise or proposed exercise of the workplace right.
53The onus is on an applicant to establish the first two elements. Section 361 has the effect that the onus is on the respondent to disprove the third element: see Tattsbet Ltd v Morrow [2015] FCAFC 62 at [119]; Construction, Forestry, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd [2015] FCAFC 157 at [27]-[28]; Short v Ambulance Victoria [2015] FCAFC 55 at [54].
54The principles bearing upon a respondent’s discharge of the s 361 onus were discussed by the High Court 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. They were summarised by Buchanan and Tracey JJ in State of Victoria (Office of Public Prosecutions) v Grant [2014] FCAFC 184; (2014) 246 IR 441 at [32] as follows:
ŸThe central question to be determined is one of fact. It is: “Why was the adverse action taken?”
ŸThat question is to be answered having regard to all the facts established in the proceeding.
ŸThe Court is concerned to determine the actual reason or reasons which motivated the decision-maker. The Court is not required to determine whether some proscribed reason had subconsciously influenced the decision-maker. Nor should such an enquiry be made.
ŸIt will be “extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer.”
ŸEven if the decision-maker gives evidence that he or she acted solely for nonproscribed reasons other evidence (including contradictory evidence given by the decision-maker) may render such assertions unreliable.
ŸIf, however, the decision-maker’s testimony is accepted as reliable it will be capable of discharging the burden imposed on the employer by s 361.
I note that the comments of Buchanan and Tracey JJ in State of Victoria (Office of Public Prosecutions) v Grant [2014] FCAFC 184; (2014) 246 IR 441 (Grant) at [32] referred to comments of the High Court in Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500 (Barclay) at 517 (French CJ and Crennan J); 542 (Gummow and Hayne JJ); 545-6 (Heydon J) and Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2014] HCA 41; (2014) 253 CLR 243 (CFMEU v BHP Coal) at [19]-[22] (French CJ and Kiefel J); [85]-[89] (Gageler J).
Further, I respectfully adopt White J’s articulation of principle as relevant to the current proceedings.
Did Mr Whelan have a workplace right, and did he exercise or propose to exercise such a right?
Mr Whelan pleads that he exercised a workplace right as defined in section 341 of the FW Act by:
·Inquiring of Mr Beynon when he would be paid an incentive bonus for the 2014/2015 financial year, or when a plan for the payment of an incentive bonus for the 2015/2016 financial year would be put in place, and
·Refusing to comply with a direction that he obtain his wife’s execution of a non-disclosure agreement.
Inquiry about incentive bonus or plan for incentive bonus for financial year ending 30 June 2015
Section 341(c)(ii) defines a workplace right in an employee as being the entitlement of the employee to make a complaint or inquiry in relation to his employment. In such cases as Shea v TRUenergy Services Pty Ltd (No 6) [2014] FCA 271; (2014) 242 IR 1 (Shea), Murrihy v Belezy.com.au Pty Ltd [2013] FCA 908; 238 IR 307 and Walsh v Greater Metropolitan Cemeteries Trust (No 2) [2014] FCA 456; 243 IR 468 (Walsh), s 341(c)(ii) was interpreted broadly. In Walsh [41], Bromberg J observed that the requirement in s 341(c)(ii) that a complaint or inquiry by the employee be “in relation to” his employment means that there must be a relationship between the subject matter of the complaint and the complainant’s employment. As Dodds-Streeton J further observed in Shea, 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.
As a general proposition, a complaint or inquiry to the employer by an employee in relation to his or her entitlement to an incentive bonus, or the failure of the employer to prepare an incentive bonus plan, where the terms of employment of that employee make provision for payment of such bonuses or the preparation of such plans, would fall within the scope of s 341(c)(iii) of the FW Act.
Turning now to the present circumstances, the following conclusions may be drawn.
First, and temporarily placing to one side the parameters of Mr Whelan’s contract of employment, it is plain that Mr Whelan’s terms of employment contemplated payment of incentive bonuses to him. Clause 2.3 of the written contract of employment annexed to the affidavit of Mr Whelan affirmed 1 July 2016 provided:
2.3Incentive Bonus Plan
2013-14 Bonus Plan
1.0The employee will be eligible for an incentive bonus if the company meets budget. The actual bonus amount will be determined by your performance to the defined objectives. A minimum of $25,000 will be set for 2013-2014.
2.0The employee will be eligible for an additional incentive bonus if the company exceeds budget. This will be a percentage base bonus – the employee will be entitled to a % of the total net amount that exceeds the agreed annual budget.
3.0Annual Bonus Plans will be ongoing and will be set when the budget is finalised prior to each financial year beginning 2014-2015
Discretionary Bonus
4.0The employee will be eligible for additional incentive bonuses at the discretion of the Managing Director.
(Original emphasis.)
It is common ground that the first respondent paid Mr Whelan a bonus of $100,000 in or about September 2014 for the financial year ended 30 June 2014, although the respondents claim that the bonus was referable to the joint net profit of the first respondent and a related entity for that financial year.
Second, although the respondents deny that Mr Whelan was entitled to be paid a bonus for the financial year ending 30 June 2015, he had reason to believe that he could be entitled to one. Clause 2.3 (3.0) clearly provided that annual bonus plans (presumably involving him) would be ongoing and beginning that financial year. At the very least the terms of his contract contemplated that there would be a bonus plan for that financial year.
Third, even if Mr Whelan was not contractually entitled to a bonus for the financial year ending 30 June 2015 in accordance with cl 2.3 (3.0) of his employment contract, he was eligible for incentive bonuses at the discretion of Mr Beynon in accordance with cl 2.3 (4.0) of the contract. A query by Mr Whelan to Mr Beynon about a bonus could plausibly refer to that clause, irrespective of the financial state of the first respondent.
Fourth, there is evidence before me that Mr Whelan made inquiries or complaints concerning his entitlement to be paid a bonus, or the formulation of a bonus plan by the first respondent, both in the months leading up to his summary dismissal and on the day of his dismissal.
In his affidavits affirmed 1 July 2016 and 7 October 2016, Mr Whelan gave evidence that he asked Mr Beynon about the prospect of being paid a bonus at least three times between May and August 2015, and that Mr Beynon was either dismissive (“Don’t worry, I will look after you.”) or angry about being asked (“Cash flow is terrible and it’s your fault, targets have not been made for the year so you won’t be getting a bonus, I am sick of you asking.”) Mr Whelan and Mr Beynon had another conversation where Mr Whelan again raised the issue of bonus, and Mr Bonus responded very aggressively. None of this evidence has been contradicted.
In his affidavit of 1 July 2016 at [101], Mr Whelan gave further evidence that, at his meeting with Mr Beynon on 24 August 2015, words to the following effect were said:
Me:“Look nothing is going on, we are just having money troubles, I just thought my bonus would be coming and I’d have money to stop worrying about house payments and car payments and be able to spend money on the family, maybe take them to Africa or America.”
Travers:“Andrew if you have worries and stress then it will affect me and the business, I need to know if anything is wrong, you have made this my problem.”
Me:“If you take the boat out of my salary and the car I am no better off than I was a [sic] BATA, unless I get a bonus. I secured the Nightowl contract and I’ve hit the targets we spoke about I should be receiving a 100% of my salary as a bonus.”
Travers:“You are not on top of vending, yYou [sic] need to do much better on vending. I pay you plenty of money, no one is getting a bonus this year.”
Me:“Vending is not easy. But I will get on top of it We have much more debt here in Queensland, I was depending on the bonus.”
Travers:“If you want a fucking bonus, get out and fucking get a bonus.”
(Emphasis omitted.)
More detail in respect of the discussion of 24 August 2015 became available following the tender by the respondents of a transcript of recording of that meeting between Mr Beynon (described in the transcript as Facilitator) and Mr Whelan (described in the transcript as Interviewee), marked as Exhibit 11(R) (meeting transcript). It appears that the discussion was recorded without Mr Whelan’s knowledge, however in submissions both parties referred to this document. It appears that the following conversation occurred:
Beynon:…Or are you going to say I need the bonus of another $100,000 otherwise – so you’re telling me you were getting $400,000 – $340,000 from Barda, because that’s what you told me when we first met.
Whelan:Yes, it was, Travers.
Beynon:You said you got $230,000.
Whelan:$230,000 and bonuses, Travers, and on-costs.
Beynon:But you weren’t going to get…
Whelan:Travers, everyone gets a bonus at Barda. You ask Jeff.
Beynon:That wasn’t what they told me. Shannon and Jeff told me the other day, they didn’t. I remember. There was a fucking uproar. People left because of it. You told me last time, last year, and that’s why you were lucky you left, because people were so pissed at Barda because they haven’t got their bonuses, where every other year they’ve got it.
So what money problem would you have been in then, at $230,000? It would have been the same as you are in now, because you would have had $230,000 with a $500,000 loan. Now you’re on $470,000 plus a car, so bring that back to $330,000, with an $800,000 loan. So it’s the same thing. It’s pineapples. So you’re in no worse financial position. So you shouldn’t be stressed.
Whelan:Okay. Okay, then, mate, okay.
Shortly thereafter the conversation continued as follows:
Whelan:No, I don’t want to argue with you, Travers.
Beynon:Well, I need to know so I can fix it.
Whelan:I came to you because I wanted to talk about long-term financial goals with Freechoice. That’s why I sent you the text, Travers, not about a bonus now, not about anything like that. To set a long-term plan. Would there be a bonus structure this year?
Beynon:No, no, this is where you’ve got to slow down. We’re about the job at hand.
Whelan:I’m doing the job at hand, Trav.
Beynon:I have asked you for years now, for two years, to get vending under control. Even back to the day of Warren Henry, and you don’t get that involved. I need vending…
Whelan:I’m in there now, Travis.
And later:
Beynon:You said to me last time we had a conversation, you said you depend on the bonuses. Can you explain to me how? Where is it that you need the bonuses?
Whelan:I’ll have to get my spreadsheet and show you.
…
Beynon:… you don’t live like we do and the kids aren’t – they don’t eat like Valentino, and I have four kids, you have two kids. You don’t have a house like mine, with electricity and rate, which all amplifies up. You don’t have that. So living is plenty there. Where is it that you need the bonus to survive, you count on the bonus to survive? That’s what you told me.
Whelan:Yeah, I do. I’ve always counted on a bonus in any company I’ve gone in because it’s part of any package that I’ve negotiated.
Beynon:But where does it…
Whelan:Again, I’ll have to get you the numbers to have a look at.
Beynon:Well, get the numbers, then, and explain to me where you need the bonus. What about the business?
Whelan:What do you mean?
Beynon:You need a bonus for you. What about the business?
Whelan:I’m not talking about this bonus. We’ve decided that. I’m asking if there’s going to be a plan for one this year. Of course I’m going to ask that question.
Beynon:See, this is where you don’t get it. You’ve got to get this cleaned up. You’ve got to explain to me this, and then you’ve got to start to get ending back on. You’ve got to prove to me that you’re going to get the day-to-day stuff running, starting from right now. I don’t know. Where is it that the bonus is a – you will be broke if you don’t get the bonus is how you told it to me. You rely on…
Whelan:No, I never said that.
Beynon:You rely on the bonus to survive.
Whelan:I rely on the bonus to do what I want to do, correct, because I have in all the previous companies, Travers, over the last 10 years.
Beynon:I don’t care what you’ve done in your previous companies…
Whelan:Well, I do.
Mr Whelan was cross-examined extensively about bonuses, including calculation of bonuses for him and other staff, and whether he had inquired about a bonus to Mr Beynon. It is clear from his answers to those questions that he placed considerable emphasis on the inclusion of bonuses as part of any salary package, both his own and that of other senior staff at the first respondent during his time there (I note, for example, transcript page 100), and that while working at the first respondent he was focused on the prospect of being paid a bonus at the end of each financial year. Mr Whelan’s evidence also indicates that Mr Beynon placed importance on bonuses to staff as part of their packages. I note, for example, Mr Whelan’s evidence of working with Mr Beynon to calculate appropriate levels of bonuses for staff (see, for example, transcript page 101 lines 23-40).
Mr Whelan’s evidence under cross-examination was consistent with his evidence-in-chief. So, for example, I note the following exchange:
So the first entry says – it’s between 10.08 am and 10.11 am. You say to your wife:
I don’t want to outside of work. No more. He has crossed the line now.
Is that what you were saying to her?---That is, yes.
What was that a reference to?---In reference to the fact that I had a bad meeting with him about bonuses in July, and he told me I was disrespectful to him by – for asking for it so close to his mother dying.
But what’s the reference “I don’t want to outside of work” mean?---Didn’t want to socialise with him outside of work.
(Original emphasis.) (Transcript page 159 lines 19-30)
Later:
No. I think you’re right. So it’s true to say, isn’t it, that at no time did you approach Mr Beynon and suggest to him that there needed to be a new annual bonus plan developed for the 2015 year?---Completely untrue.
I see. You say – - -
HER HONOUR: Sorry. So what’s completely untrue? That you - - -?---That statement. I did approach Mr Beynon on numerous occasions.
MR RONEY: There’s not a single email, is there, between you and Mr Beynon which deals with that topic. Do you agree?---I’m not sure. I don’t recall if there’s an email.
I’m putting to you that that’s the case?---Well, I don’t recall.
…
MR RONEY: Don’t recall whether there was a text or not?---No. I don’t recall. I remember there was numerous conversation because it was only four weeks into the financial year ‘15/16 that we realised that there was a serious issue with the previous financial year’s numbers.
Well, you’re aware, aren’t you, that – I will rephrase that. I think the proposition that I put to you was that you had not, in fact, texted or emailed Mr Beynon suggesting or inviting him to produce a new annual bonus plan for the 2015 financial year?---Yes. I don’t recall.
All right. It may well be that you didn’t communicate with him in those ways on that issue. Do you accept that?---No. I did discuss those issues with him. In those ways, I said?---I don’t recall.
But it may be that you didn’t, in fact?---No. I know that I did have a lot of communications within that year because it was a really big issue.
Yes. But you’re not talking about written communications. I am?---Well, that’s a form of communication.
Yes. I’m asking you about written communications. You didn’t send any written communications to Mr Beynon and, I suggest, to anyone else within FreeChoice inviting or suggesting them to revise the bonus plan for 2015?---I don’t recall.
You’re not even prepared to concede the possibility that you didn’t?---No because I don’t recall.
All right.
(Transcript page 129 lines 1-14 34-47, page 130 lines 1-14)
And:
All right. I’m just referring to the pleaded case that you put in each of those two documents that her Honour has just admitted. And also that which is in the current pleading. And the proposition I’m putting to you is that in the conversation with Mr Beynon on 24 August, which turned out to be the day you were dismissed, you did not ask him why you had not been paid a bonus, first of all?---No, that’s right.
And he did not say to you that you were not entitled to one, or denied that you were entitled to one?---That’s correct.
In fact, you didn’t have a discussion with him in that conversation of that day, or, I suggest, on any other day in which you were insistent on him in 5 paying you a bonus for that financial year?---That’s incorrect.
You certainly didn’t discuss it on that day, did you?---Not on that day, no.
You had a long meeting that day. As you recall it, how long did that go for?---maybe two hours.
Covered a lot of topics, yes?---Yes.
And, certainly, the issue of bonuses did come up?---Yes, it did.
Right?---Yes.
Now, it’s your case, isn’t it, as you understand it, that the reason that Mr Beynon caused his company to terminate your employment that day was that he did it to avoid paying you a bonus?---That’s correct.
But nothing happened that day which raised the prospect of you demanding that he pay you a bonus; correct?---No, that’s incorrect. I asked also about the – the future bonus.
That’s in that conversation, is it?---It is.
Right. Well, we will come to that in a moment. But you didn’t, coming back to my question, demand that he pay you a bonus of any particular kind, did you?---No.
And he didn’t refuse to provide you with a bonus of any particular kind?---Not on 24.
Nor, I suggest, on any other occasion?---That’s incorrect.
But your case remains that he terminated you that day to avoid paying you a bonus?---Yes.
And you have no basis, I suggest, for that whatsoever?---I don’t agree.
He never said to you in that meeting that you were going to be dismissed or imply that you would be dismissed if you insisted on a bonus?---No, he didn’t.
And on no other occasion when you conversed with him on the topic of bonuses, up till that day, did he suggest or imply that you would be terminated if you insisted on being paid a bonus for that year?---No. He told me I was disrespectful.
Right. So will you answer my question. On no occasion did he ever say to you, in conversation or otherwise leading up to your termination, that if you wanted or insisted on a bonus, you stood the risk of being terminated?---No, that’s – sorry. That’s correct, yes.
(Transcript page150 lines 43-47, page 151, page 152 lines 1-4)
Fifth, while the respondents plead that Mr Whelan was not entitled to be paid a bonus for the financial year ending 30 June 2015, I consider his entitlement or otherwise is irrelevant to the question whether he actually made a complaint or inquiry in relation to his employment for the purposes of s 341(c)(ii).
Refusing to comply with a direction that he obtain his wife’s execution of a non-disclosure agreement
Evidence was given in respect of this issue by Mr Whelan and Ms Ozioko.
It is not in dispute that, on the afternoon of 24 August 2015, Ms Ozioko asked Mr Whelan to arrange for Mrs Whelan to sign a non-disclosure agreement. In her affidavit, Ms Ozioko gives the following evidence:
92.After my meeting with Travers, I went to Mr Whelan’s work area and asked him if he could obtain a signed confidentiality agreement from Mrs Whelan. He said to me words to the effect that Mrs Whelan shouldn’t have to sign a confidentiality agreement. He told me that I’d have to speak to Mrs Whelan myself. Mr Whelan then left the office. The time was about 2.50pm.
At this point however Ms Ozioko’s evidence diverges from that of Mr Whelan.
Mr Whelan deposes at [107] of his affidavit affirmed 1 July 2016 that he and Ms Ozioko had the following conversation:
Suzie:‘‘Travers has asked that Tracy need [sic] to sign this non-disclosure agreement because you went to the party at the candy mansion.”
Me:“Is everyone’s partner that attended the party getting this today?”
Suzie:“No but Travers has said it must be on his desk by 9am tomorrow”
Me:“I don’t feel comfortable telling my wife to sign it. Feel free to give Tracy a call and you can discuss it with her. You have been dealing with all NDA’s [sic] the models and staff, so I will leave it to you to call Tracy and get it signed.”
(Emphasis omitted.)
In contrast in her affidavit affirmed 6 September 2016 Ms Ozioko deposes:
93.I refer to paragraph 107 of the Whelan Affidavit. Mr Whelan never said words to the effect of “is everyone’s partner that attended the party getting this today?”, and I did not say words to the effect of “Travers has said it must be on his desk by 9am tomorrow”. Mr Whelan did tell me that he did not feel comfortable telling his wife to sign it and that I was free to call her myself. Mr Whelan did not say words to the effect: “You have been dealing with all NDA’s for the models and staff”. In fact, Mr Whelan and I had both been responsible for arranging for the signing of the new confidentiality agreements, so it would have made no sense for Mr Whelan to have said that to me.
Ms Whelan gave further evidence that around 3.10 pm on 24 August 2015 he received a telephone call from Mr Beynon in which Mr Beynon said he had been informed by Ms Ozioko that Mr Whelan refused to ask Mrs Whelan to sign the non-disclosure agreement. Mr Whelan’s evidence at [109] of his 1 July affidavit was that his conversation with Mr Beynon continued:
Me:“I wanted to keep my work and home life separate. This is an unusual and unnecessary request. Suzie has been dealing with these and I don’t want a part of it. I am happy for Suzie and you to meet with Tracy and her Dad and explain to them why she needs to sign it today. I don’t understand why all of a sudden she needs to sign by tomorrow.”
Travers:“It has to be signed by 9.00am tomorrow morning or else.”
Me: “Is that a threat?”
Travers:“Take it as you want, I am now ending this call.”
(Emphasis omitted.)
Mr Whelan pleads this aspect of his case in two ways. The first is as a complaint or inquiry, being a refusal to carry out a task he was not legally obliged to do and conduct by which the first respondent, through Mr Beynon, was purporting to terminate his employment if he did not comply. The second is as a particular of the adverse action, namely that the first respondent discriminated against the applicant in his employment by treating him less favourably than other employees who did not make complaints or inquiries that the first respondent required the applicant’s wife to sign a document which other employees’ partners were not required to sign. I will deal with each in turn, though note the ambiguous nature of the pleading.
Mr Whelan submits that his refusal to comply with this direction was a complaint in relation to his employment for the purposes of s 341(c)(ii) of the FW Act, and relies on Shea [2014] FCA 271; (2014) 314 ALR 346 at [29] where Dodds-Streeton J explained that a “complaint” for the purposes of s 341(c)(ii) was:
… 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.
I am unable to identify how Mr Whelan’s refusal to accede to the request of Ms Ozioko and Mr Beynon to ask Mrs Whelan to sign a non-disclosure agreement can be described as “a complaint or inquiry” by Mr Whelan such as to fall within the scope of workplace right pursuant to s 341(c)(ii). Most favourably to Mr Whelan, the situation appears to be that Mr Whelan told Ms Ozioko that he was uncomfortable asking his wife to sign the relevant agreement, suggested that Ms Ozioko speak with Mrs Whelan herself, and then received a short and angry telephone call from Mr Beynon about the issue. Even relying on the definition of “complaint” suggested in Shea [2014] FCA 271; (2014) 314 ALR 346, I am not satisfied that anything said or done by Mr Whelan constituted a complaint in the form of a communication conveying a grievance, finding of fault or accusation. Certainly there was no “inquiry” by Mr Whelan about this issue. The terms of s 341(c)(ii) are wide, but not so wide as to include the mere resistance by Mr Whelan to Ms Ozioko’s request and his suggestion that Ms Ozioko ask Mrs Whelan about the non-disclosure agreement, and the inconclusive conversation with Mr Beynon later that day.
In my view this issue does not give rise to a workplace right in Mr Whelan within the meaning of the FW Act.
Was “adverse action” taken against Mr Whelan?
Item 1 in the table to s 342(1) of the FW Act defines adverse action taken by an employer against an employee as including circumstances where 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.
As I have already noted, Mr Whelan alleges that adverse action was taken against him in three different ways.
First allegation of adverse action: dismissal
It is common ground that Mr Whelan was summarily dismissed by the first respondent, at the direction of Mr Beynon, on 24 August 2015. This dismissal of Mr Whelan was clearly “adverse action” against him by the first respondent, as defined by item 1(a) in the table to s 342(1) of the FW Act.
Second allegation of adverse action: refusal to pay bonuses
The second form of adverse action pleaded by Mr Whelan was the refusal of the first respondent to pay Mr Whelan bonuses which were owed to him.
The evidence before the Court is that, despite Mr Whelan raising with Mr Beynon the prospect of him being paid a bonus or the prospect of the first respondent preparing a bonus plan, the first respondent, through the second respondent, informed Mr Whelan that he would not be paid a bonus. To the extent that this conduct could be “adverse action” it could only fall within s 342(1)(c) or (d) of the FW Act, namely where an employer:
(b)injures the employee in his or her employment; or
(c)alters the position of the employee to the employee’s prejudice;
In my view, Mr Whelan was not owed bonuses, such that a refusal by the first respondent to pay him bonuses he has claimed constituted an injury to him in his employment or altered his position to his prejudice. I have formed this view for reasons I will explain later in this judgment in the context of Mr Whelan’s claim of breach of contract.
Third allegation of adverse action: requirement that Mrs Whelan sign a non-disclosure agreement
The third type of adverse action alleged by Mr Whelan was the requirement of the first respondent that Mrs Whelan sign a document which other employees’ partners were not required to sign.
It is difficult to identify the basis on which Mr Whelan claims that he was the subject of adverse action in this respect.
First, the pleading in paragraph 41(a)(ii) of the third further amended statement of claim refers to conduct of the first respondent in respect of Mrs Whelan, not Mr Whelan. On the basis that Mr Whelan could not dictate Mrs Whelan’s decision to execute (or refuse to execute) a non-disclosure agreement, the action of the first respondent as pleaded was directed towards Mrs Whelan, not the applicant.
Second, to the extent that Mr Whelan was concerned by the alleged requirement, the evidence shows that Mr Whelan’s principal concern was that he was being tasked with arranging this with Mrs Whelan, when in his view it was Ms Ozioko’s job to approach Mrs Whelan about it. In particular I note his evidence at [107] of his affidavit noted above.
Indeed, in cross-examination Mr Whelan accepted that it was reasonable for the first respondent to approach Mrs Whelan to ask her to sign a non-disclosure agreement, because confidentiality in respect of events at The Candy Shop Mansion was important and Mrs Whelan attended such events. In particular I note the following exchange between Mr Roney QC for the respondents and Mr Whelan:
Now, having regard to what I think you’ve agreed was important about protecting confidentiality associated with what happened at the Candy Store Mansion – Candy Shop Mansion, you would accept, wouldn’t you, that it was reasonable to have people like your wife, who were allowed to go to functions there, to sign nondisclosure agreements?---Only in the last couple of months, yes. Yes.
But you accept that it was reasonable to expect people who were going to be allowed to come to those to sign up confidentiality agreements which would cover their attendances, whenever that was?---Yes. Yes.
And on 24 August, Ms Ozioko came to you, didn’t she, and asked you to give effect to some arrangements that she was trying to put in place to get your wife to sign one of those?---Yes, she did.
And you didn’t feel comfortable about asking your wife to do that?---I didn’t, no.
And you effectively said to her, look, if that’s what you need to do, you do it?---Yes. I asked her firstly who else’s partner was signing them that day.
Yes?---And I said to her I don’t feel comfortable in doing that, because she looked after all the nondisclosure agreements, not me.
All right. So was that the only conversation you had with anyone that day, apart from your wife, I mean, about this need to have a confidentiality agreement signed, or a nondisclosure agreement signed?---No. Travers Beynon contacted me as well after that conversation and asked me to do the same thing that Suzie asked me.
All right. And do you remember what he said?---Yes.
Can you tell us?---He said to get it done tomorrow or else. He asked me prior to that why I did not feel comfortable, everyone should be signing nondisclosure agreements. He has to be done by 9 am tomorrow. I asked him if it was a threat. He said you can take it as you will, but it needs to be on his desk by 9 am tomorrow. I again said to him I don’t feel comfortable in doing that. At no time did I say Tracey would not sign it. But what I said is that Tracey would actually speak with her father and look to why she needed to sign that document. But I would prefer Ms Ozioko or himself to contact my wife, because I didn’t feel comfortable in doing that.
And we know, don’t we, that he then did speak to Ms Ozioko about that, and Ms Ozioko did approach your wife?---That’s right.
(Transcript page 220 lines 6-45)
Third, if Mr Whelan had considered the first respondent’s requirement in respect of Mrs Whelan inappropriate or discriminatory of him, he could have told Ms Ozioko this.He did not. Instead, Mr Whelan’s evidence was that he suggested that Ms Ozioko contact Mrs Whelan directly. Ms Ozioko gave evidence that following her conversation with Mr Whelan she did what Mr Whelan told her, and contacted Mrs Whelan directly. Ms Ozioko’s unchallenged affidavit evidence was as follows:
95.At approximately 3:08pm, I sent a text message to Mrs Whelan. The text message read:
“Hi Tracy
I need to set up a time to have you sign the confidentiality agreement, we are having everyone that has attended and been involved in events and will be in the future sign and you and tori are my last ones. Can we coordinate this? I can come to you if necessary? I need to get this done by tomorrow. Let me know.
Regards
Suzie”
96.I did not receive a response to my text message.
Fourth, I note the unchallenged evidence before the Court that when Mr Whelan told Ms Ozioko that she (rather than he) should contact Mrs Whelan, Ms Ozioko informed Mr Beynon who then rang Mr Whelan and told him to have the signed agreement by Mrs Whelan on his desk the following morning, “or else.” The respondents concede that this instruction had an imperative element to it, however, they submit that it was scarcely a demand in relation to an issue of such critical significance that non-compliance with it then and there would have resulted in Mr Whelan’s dismissal. I agree. “Or else” potentially covers a range of consequences, including further unpleasant conversations with Mr Beynon. Dismissal of Mr Whelan was not threatened at that stage by Mr Beynon.
Fifth, Ms Ozioko gave the following evidence:
93.I refer to paragraph 107 of the Whelan Affidavit. Mr Whelan never said words to the effect of “is everyone’s partner that attended the party getting this today?”, and I did not say words to the effect of “Travers has said it must be on his desk by 9am tomorrow”.
Contrary to Ms Ozioko’s evidence, I consider it plausible that Mr Whelan did ask whether other employees’ partners were receiving non-disclosure agreements that day. I consider this plausible because Mr Whelan had earlier that day been party to a difficult conversation with Mr Beynon, and it is possible that he was feeling defensive in its aftermath. However, it does not follow, even if Mr Whelan understood that only Mrs Whelan was being approached for a non-disclosure agreement, that he objected. Indeed his other evidence suggests he thought it appropriate that Mrs Whelan be asked to sign a non-disclosure agreement, because of her privileged position in being invited to attend functions at The Candy Shop Mansion, and the clear importance of confidentiality to the first respondent.
I do however accept Ms Ozioko’s evidence that she did not tell Mr Whelan that Mr Beynon had said the agreement must be on his desk by the following morning. Ms Ozioko reported to Mr Whelan, and I consider it unlikely that she would have made this communication to her manager in the form of the ultimatum alleged by Mr Whelan.
Sixth, although Mr Whelan does not specifically plead s 342(1)(d), I note that that section defines adverse action as including where an employer discriminates between the employee and other employees of the employer. Mr Whelan pleads at [41(a)(ii)] that the first respondent discriminated against the applicant in his employment by treating him less favourably than other employees who did not make complaints or inquiries in that the first respondent required Mr Whelan’s wife to sign a document which other employees’ partners were not required to sign. However, I am not satisfied that the facts as pleaded supports a finding of discrimination. To the extent that “discrimination” in s 342(1)(d) of the FW Act bears the ordinary dictionary meaning of “to treat employees differently” (see the discussion in Creighton WB, Creighton and Stewart’s Labour Law (6th ed, Federation Press, 2016) at [20.48] (Creighton and Stewart)) there is no evidence that Mr Whelan was treated differently from other employees. Rather, it is apparent that Mrs Whelan was being asked by the first respondent to sign a non-disclosure agreement because she had been allowed to attend functions at The Candy Shop Mansion. I consider it likely that if partners of other executives attended such functions, they would also have been asked to sign non-disclosure agreements.
I consider that Mr Whelan’s claim of adverse action against him relating to Mrs Whelan being required to sign a non-disclosure agreement has no merit.
The next – and key – question is whether the adverse action taken by the first respondent against Mr Whelan in the form of summary dismissal was because Mr Whelan exercised a workplace right.
Was there a causal nexus between the exercise by Mr Whelan of a workplace right and the adverse action taken against him?
The evidence before the Court demonstrates that Mr Whelan had made inquiries about either payment of a bonus or the establishment of a bonus plan both in the weeks prior to, and on the day of, his dismissal. These inquiries can properly be characterised as complaints or inquiries in relation to his employment, and therefore the exercise of a workplace right.
It follows that not only was adverse action taken, but also a relevant workplace right existed as an objective fact: Tattsbet Limited v Morrow [2015] FCAFC 62; (2015) 233 FCR 46 at [119]; Construction, Forestry, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd [2015] FCAFC 157; (2015) 238 FCR 273 at [76], [132]. There was a causal nexus between the exercise by Mr Whelan of a workplace right and the adverse action taken against him.
Reason for the adverse action taken against Mr Whelan by the first respondent
Turning now to this issue, I note the following preliminary points.
First, the onus rests with the first respondent to disprove the presumption which the Court now entertains that the adverse action against Mr Whelan was taken for a reason proscribed by the FW Act, namely because Mr Whelan exercised a workplace right.
Second, as Buchanan and Tracey JJ observed in Grant at [32] it is extremely difficult for an employer to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer. That is precisely the position in this case. The decision-maker in respect of Mr Whelan’s summary dismissal was, without doubt, Mr Beynon. That this is so is evident from Mr Whelan’s termination letter of 24 August 2015 signed by Mr Beynon on behalf of the first respondent (and marked as annexure AW-15 to Mr Whelan’s affidavit affirmed 1 July 2016), evidence of Ms Ozioko that Mr Beynon had told her on 24 August 2015 that he “had no choice but to terminate [Mr Whelan’s] employment” (see Ms Ozioko’s affidavit affirmed 6 September 2016 at [100]), and the admission of the respondents that Mr Beynon was the managing director of the first respondent at that time and in that role he had oversight of the operation of the first respondent’s business activities and managed its senior staff. However, Mr Beynon has not given evidence concerning Mr Whelan’s summary dismissal. As Mr Whelan correctly submits, this lacuna in evidence makes it difficult for the Court to determine with absolute clarity the “real” reasons for Mr Whelan’s dismissal on 24 August 2015.
Third, in the absence of evidence given by Mr Beynon, the respondents relied heavily on the transcript of the recorded meeting between Mr Beynon and Mr Whelan of 24 August 2015. While this transcript is in evidence, I treat it and its contents with caution. Mr Whelan’s statements during the course of that meeting either were, or could have been, tested and clarified at the hearing by cross-examination. Mr Beynon’s statements were not tested, and could not be tested, given that he gave no evidence in the proceedings.
The respondents’ case
With the onus resting on the respondents in mind, I now turn to the arguments advanced by the respondents as to why Mr Whelan was dismissed.
The respondents submit that “it is unquestionably the case” that Mr Beynon terminated Mr Whelan’s employment because Mr Whelan had breached confidentiality associated with the publication of an article and associated photoshoot in Zoo Magazine by giving an advance copy of that article to Ms Chanel Stewart, such conduct being “gross misconduct” on Mr Whelan’s part. Relevantly I note that cl 9.1 of Mr Whelan’s contract entitles the first respondent to dismiss him without notice in the event of gross misconduct.
In written submissions the respondents elaborate:
116.The justifications included those matters, but others that were in the mind of Ms Ozioko and Mr Beynon namely:
(a)lying to the Second Respondent about the Applicant’s involvement in the disclosure of the Zoo article information above and his having disclosed such information;
(b)lying to Ms Suzie Ozioko about the fact that the Applicant had told the Second Respondent during the course of the business trip to Europe to “fuck off” when the Applicant had not in fact done so, and lying to the Second Respondent in relation to that conversation both since and on the day of termination;
(c)a lack of trust on the part of the Second Respondent in the Applicant’s ability to continue to act as General Manager given the Applicant’s inability to manage his own financial affairs, which matter was discussed during the course of the meeting that day;
(d)the Applicant failing to act in a truthful way in his dealings on 24 August 2015 with the Second Respondent;
(e)the Applicant’s failure to comply with the Second Respondent’s oral instruction given earlier on 24 August 2015 not to leave the office before 5.00pm that day to attend a meeting with the Second Respondent that afternoon, by leaving the office before that time;
(f)in the circumstances the Applicant’s intention or failure to either answer or return telephone calls made by the Second Respondent to the Applicant’s mobile phone; and
(g)the prospect, having regard to the matters pleaded in paragraphs A to F above that the Applicant would imminently resign from his employment with the First Respondent and act contrary to the First Respondent’s interests including in disclosing confidential information.
As to the allegation that Mr Whelan failed to act in a truthful way in his dealings on 24 August 2015 with Mr Beynon, the respondents particularised the allegation in [117] of their written submissions of 18 May 2017 as follows:
(a)Mr Whelan was perceived to be evasive in telling the truth about the reasons he was in such financial circumstances Beynon asked Whelan whether he had purchased a new property and Andrew said no. Mr Whelan had purchased a new property just weeks early. The relevant part of exhibit 11 contains this exchange …
(b)Mr Whelan was perceived to be evasive in telling the truth about and Whelan continued to deny that he had told Ms Ozioko that he’d told Travers to “fuck off” on the European trip when Beynon believed he had done so …
(c)Mr Whelan was perceived to be evasive in telling the truth about whether he had been absent from work whilst Travers and Suzie were away from the office in July which Mr Beynon did not believe …
(d)Mr Whelan was perceived to be evasive in telling the truth about Andrew denied that he had been leaving work before 5pm …
Ms Ozioko gave evidence concerning the importance of confidentiality in the business dealings of the first respondent. There was extensive cross-examination of Mr Whelan concerning this issue, during which Mr Whelan accepted that confidentiality in the business practices of the first respondent was of high importance to it.
The respondents submit that, reduced to a minimum, Mr Whelan’s case is that there was a sham or deceit in relation to the reason for termination, and that he was not really terminated for breach of confidentiality, or for any other reason, but to ensure Mr Whelan was not paid a bonus when he was otherwise entitled to one. They submit further that the cross-examination of Ms Ozioko left the majority of her evidence on the issues which are critical to the determination of this case almost entirely untouched and unchallenged and that her evidence directly explained the process of thinking in the first respondent leading up to Mr Whelan’s dismissal.
The respondents submit that when Mr Whelan contacted Mr Beynon on 17 August 2015 he said nothing to Mr Beynon about a bonus.
Evidence before the Court
I have already referred to evidence of Mr Whelan as to his exchanges with Mr Beynon concerning Mr Whelan’s request for a bonus in the financial year ending 30 June 2015, and the transcript of the recording of the meeting between Mr Beynon and Mr Whelan of 24 August 2015 so far as concerned bonuses. I have also noted that Mr Beynon has not given evidence of his reasons for dismissing Mr Whelan.
Although initially relying on Mr Whelan’s alleged gross misconduct, the case of the respondents expanded to claim that the “real” reasons for Mr Whelan’s dismissal were his gross misconduct in breaching confidentiality, his lack of candour, the inability of Mr Beynon to trust him, his failure to follow oral directions, and the belief of Mr Beynon that Mr Whelan was about to resign. In order to understand the respondents’ defence it is necessary to have regard to such evidence as is before the Court.
Evidence of Mr Whelan
Mr Whelan gave evidence that in about May 2015, Mr Beynon held a “Candyman” photo shoot at his house, attended by senior staff including Mr Whelan, and that Mr Beynon informed them that the photographs were intended to appear on social media to promote the business as well as in Zoo Magazine. In his affidavit affirmed 1 July 2016, he continued:
128Shortly after the photo event, Travers and I went overseas on a business trip on behalf of Freechoice, but which I understood was really just an opportunity for more photos to promote the “Candyman” image that Travers believed would promote Freechoice. I say this because there was no work done for Freechoice only photo shoots and he bought along his photographer from Australia. Whilst overseas, I received an electronic copy of the article from Zoo Weekly Magazine on my phone, which included some of the photos taken at the photoshoot. I shared this article and photos with Travers whilst staying at a hotel in Spain and we read through the article together.
129.Later that afternoon, one of the models of the photo shoot, Chanel Spencer, sent me a text message and asked if I had a copy of the Zoo Magazine article as the magazine article had sold out in stores at home. I had a conversation with Travers to the following effect:
Me:“Chanel has texted me asking if she can get a copy of the Zoo article because she can’t get a copy back home as it sold out. Is it ok if I send it to her?”
Travers:“No problems how cool is it that it is sold out.”
130.I then forwarded the photos and article to Chanel via email. Annexed and marked AW-16 is a copy of the Zoo Magazine article.
131.Following subsequent discussions with Travers’ publicist, I learnt that the Zoo Weekly magazine was not due to be published until the next week. I wasn’t concerned that I had sent this to Chanel and this was never discussed any further with Travers or the publicist Bruce Nelson. It was never bought to my attention that I had breached any confidential communication provisions of the employment contract as a result of forwarding the Zoo article to Chanel until I received the letter of termination.
(Emphasis omitted.)
Annexure AW-16 to Mr Whelan’s affidavit is an email dated 23 June 2015 from Mr Whelan to Ms Stewart, attaching an article containing numerous photographs of Mr Beynon with women wearing bikinis, and prose under the heading “The Aussie who’s living the dream”. The email read:
Hey Babe
Hope you get this
Andrew
The email also forwarded an earlier email to Mr Whelan from Mr Bruce Nelson of Zakazukha Marketing Communications which read “Hi Andrew, To discuss later today” and attached the article.
Mr Whelan was extensively cross-examined by Mr Roney QC for the respondents about events related to the Zoo Magazine article and the trip to Europe. Mr Whelan gave evidence including the following:
·It was Ms Ozioko’s job, not his job, to get non-disclosure agreements signed by participants in the ZOO Magazine photoshoot (transcript page 184 lines 21-27);
·He had verbal authority from Mr Beynon to send Ms Stewart the Zoo Magazine article. Mr Beynon never expressed any annoyance or anger to Mr Whelan concerning Mr Whelan’s action in sending Ms Stewart the Zoo Magazine article (transcript page 185 lines 20-28, page 186 lines 39-47);
·Mr Beynon accused him of “falling in love” with one of the promotional models, Ms Scarlett Bouvier, on a yacht during the Europe trip (transcript page 196 lines 1-4, page 199 lines 32-45). Mr Whelan gave evidence denying this, and further that he told Mr Beynon to “piss off” (transcript page 196 lines 6-10, page 200 lines 4-6);
·During the Europe trip in June 2015, Mr Beynon complained that Mr Whelan spent too much time with the promotional models rather than with him (transcript page 199 lines 14-19);
·On his return to Australia from the trip to Europe in June 2015, he did not tell Ms Ozioko that he had told Mr Beynon to “fuck off” – he told Ms Ozioko that he and Mr Beynon had had an argument (transcript page 193 lines 43-44). Mr Beynon was furious that Mr Whelan had told Ms Ozioko that they had argued during the trip (transcript page 194 line 16);
·He did not answer Mr Beynon’s telephone calls around 4.00 pm on the afternoon of 24 August 2015 because he did not hear or see Mr Beynon’s missed calls, being at the time attending a medical appointment because he felt unwell (transcript pages 282-283);
·He sent the following text message to his wife at 12.16 pm on 24 August 2015 after meeting with Mr Beynon:
Terrible. He’s a cunt, darling. I can’t stand it any more and can’t put up with his abuse and shit. No bonus, no bonus structure this year. Said he will give a bonus when he feels like it. I need to leave ASAP.
Under cross-examination Mr Whelan said that this did not meant that he intended to resign at that point – rather he was upset at Mr Beynon because of their meeting of earlier that day (transcript page 271 lines 1-18);
·Mr Beynon had said the following words to Mr Whelan on the morning of 24 August 2015:
I have a problem with you not being in the office as much as you should be. That has got to change. If you’re going to get a doctor’s appointment, it’s not in the afternoon, especially a Friday. You be here especially with vending. Make sure you’re there.
Mr Whelan conceded that Mr Beynon had a perception that Mr Whelan was taking time off when he should have been at the office, however Mr Whelan denied that this was the case (transcript page 267 lines 31-43). Under cross-examination Mr Whelan also gave the following evidence:
Did he communicate to you in that meeting that he believed that you spent too much time with your family and not enough at work?---Yes, I believe so.
Did you decide that you didn’t want to have anything to do with him any more?---I thought that was unfair, what he said.
(Transcript page 270 lines 21-25)
·In relation to whether Mr Whelan and Mr Beynon were to have a meeting later in the day on 24 August 2015:
Now, after the meeting that day, you were due to see him later on the day – on that day, weren’t you?---No. Incorrect.
All right. You would normally, though, liaise with him during the day on a workday, wouldn’t you?---During the day, yes, when he was in.
So – and he was in that day, was he not?---Only till about 1.30/2 o’clock – - -
Right?--- – - – as he normally is.
Okay. But in any event, on a normal day as this was apart from the fact that you had this meeting, you would be interacting with him in the course of doing your ordinary duties?---All depends what he’s doing as well.
Yes?---Yes.
But on an ordinary day, that’s what would happen?---Well, there was never an ordinary day because he wasn’t there very much.
(Transcript page 266 lines 5-22)
In his affidavit, Mr Whelan also gave detailed evidence of harassment by Mr Beynon and employees or agents of the second respondent including:
·On the afternoon and evening of his dismissal, at his home;
·Photographs being dropped in his letter box making allegations that he had an affair whilst travelling on Freechoice business;
·Abuse at local coffee shops by employees and contractors of the first respondent; and
·Text messages being sent to Mrs Whelan stating that Mr Whelan had cheated on her.
Loss of opportunity to continue employment with the first respondent
First, Mr Whelan sought compensation for loss of the opportunity to continue employment with the first respondent in the role of General Manager for an anticipated period of at least five years. In the amended statement of claim this was particularised as follows:
i.Annual wages – $309,586 annual wage as at date of termination x 5 years (anticipated future employment ) = $1,547,930
ii.Annual Bonus – $160,000 annual bonus as at date of termination x 5 years (anticipated future employment) = $800,000
iii.Discretionary Bonus - $70,000 annual commission as at date of termination x 5 years (anticipated future employment) = $350,000
Total loss for contravention of section 340 (1) = $2,697,930
(Emphasis omitted.)
I am not satisfied that Mr Whelan is entitled to compensation for the loss of opportunity to continue employment with the first respondent. Mr Whelan’s contract of employment entitled the first respondent to terminate his employment at any time, for any reason, on the provision of notice prescribed by cl 9.0 of the contract unless he was dismissed for gross misconduct or other grounds that justified instant dismissal. The evidence before the Court revealed that Mr Whelan’s relationship with Mr Beynon had significantly deteriorated by the date of his dismissal to the point where Mr Beynon berated Mr Whelan at length and refused to contemplate any further bonuses, as I have already set out in this judgment. Further, in his communications with Mrs Whelan, Mr Whelan was referring to Mr Beynon in highly disparaging language. Examples of such communications (as annexed to the affidavit of Daniel Hains, exhibit 14(R) were:
·“He’s spending money like no tomorrow and won’t reward me, the cunt. I’m done here, mate. No one f-k-e-n like that. Told me I need to do a better job. Record growth and profit and he spends most time out of business. Yes, right.”
·“I agree, mate. Me too. Sick of working for some cunt.”
·“Hate the prick. Have to put in a good face and smile and want to walk away.”
·“Yes, I’m gone anyway.”
·“I am stuck, as I can’t just go get another job due to our payments, and it hurts me.”
·“Hold on to [Mr Beynon’s credit card details] for one day to fuck him up, as I will with the ATO.”
Mr Whelan was not employed under a fixed term contract with an expectation of ongoing employment with the first respondent. Even if Mr Whelan had forced himself to continue working for the first respondent for financial reasons – which, given the level of vituperation in his references to Mr Beynon, is by no means certain – I consider it likely that Mr Beynon would have terminated Mr Whelan’s employment in the immediate future anyway given the deterioration in their relationship.
Finally, there is no evidence before the Court that Mr Whelan would have received an annual bonus of $160,000 had his employment with the first respondent continued, or that the first respondent would have paid a discretionary bonus to Mr Whelan of any amount in the future.
I am not satisfied that Mr Whelan has lost an opportunity to work for the first respondent, and that he should receive compensation he has claimed.
Loss of opportunity to continue at BATA
Second, and in the alternative, Mr Whelan claims compensation for loss of opportunity to continue employment with BATA. At [72(b)] of the amended statement of claim Mr Whelan pleads:
Further and/or in the alternative to paragraph 71 [sic], the Applicant lost the opportunity to continue in his employment at BAT for a period of at least 5 years.
Particulars
Loss of income at $205,000 per year, plus $80,000 in bonuses ($285,000 per year x 5 years) = $1,425,000
LESS income earned at the First Respondent (Particulars to be provided in evidence)
(Emphasis omitted.)
There is no causal connection between any conduct of the respondents and Mr Whelan’s claim that he lost the opportunity to continue working with his previous employer for “at least 5 years”. In particular I note that the respondents made no misleading representations contrary to s 31 of the ACL, and that the adverse action of the respondents took place years after Mr Whelan – of his own volition – ceased working for BATA and commenced working for the first respondent. In my view this aspect of the claim has no merit.
Non-economic loss
Third, at [73] of the amended statement of claim Mr Whelan claims compensation in the amount of $60,000 for distress, hurt, humiliation, emotional upset, anxiety, feelings of inadequacy, depression and other emotional and psychological damage.
Mr Whelan gave evidence that he felt defeated and humiliated as a direct consequence of the termination of his employment, and subsequent harassment to which he was subjected by the respondents and its employees. His affidavit evidence was as follows:
117.I then began to drive to my home in Helensvale. While driving home I noticed that Travers was following behind. I drove into my driveway, shutting the electronic gate behind me. As I approached, I could see my wife standing in the driveway, crying and upset. I then got out of my car and saw that Travers was parked out the front of my house. Travers Beynon was also with Suzie, Cassandra Blight and Zalie Harrison. Cassandra Blight and Zalie Harrison were Travers’ personal assistants.
118.All four of them then got out from Travers’ car and approached my gate. I saw my wife yelling at them and I told her to come inside as I could see she was extremely upset with them. At this point I was also crying and shaking uncontrollably.
119.My wife then advised me that the four of them had already been to my house and in an intimidating and threatening way to “collect company things’. The four of them left the house at this time. I then proceeded to tell her I had been terminated and showed her the email message and attachment.
120.My wife then called her parents and asked them to attend our house because we felt in fear of our safety and the family was not in a good state. I asked her to do this as I did not believe I could control my own emotions. My wife was hysterical and angry. At about 5.30pm, a security guard I know as Adam, came to our house and stood out the front of our house. I know Adam as one of Travers’ security guards. We had a conversation to the following effect:
Adam:“I have been hired by Travers to retrieve Freechoice’s laptop and phone. I have to stay out the front all night if required. I’m sorry for what had happened to you but I have been paid to stay here.”
Me:“Adam I have been sacked for no reason and I am not handing over my things until I find out what has happened. My kids are hysterical, we are all not well I need to call the police and you cannot be standing at my door all night.”
Adam:“Just do what you need to do, I’m sorry”.
121.We then called the police, and the police removed Adam from the front of our house.
122.At 9.45am on Wednesday, 26 August 2015, I gave the laptop and phone back to Freechoice.
123.After this my family and I were harassed with photos dropped in our letter box that made allegations that I had an affair whilst travelling on Freechoice business, I was abused at local coffee shops by Travers’ employees and contractors, and text messages were sent to my wife saying that I had cheated on her. I made further complaints to Freechoice’s Lawyers Nyst Legal and the police.
124.As a result of this harassment I had to have security camera put up at my house and I sought a non-harassment order in legal proceedings commence by C&GW in the Supreme Court of Queensland.
Further during the hearing Mr Whelan gave evidence that:
·three weeks after the termination of his employment, he and his family were subjected to yelling and other harassment during two incidents at a Zarraffa’s coffee outlet at the Gold Coast in September 2015; and
·he was embarrassed by his termination of employment, and by having to explain to his current employer about the embarrassment of being terminated.
Examination of evidence of Mr Whelan, Ms Marshall and Ms Ozioko indicates that:
·an incident occurred at the relevant Zarraffa’s coffee shop on 28 September 2015 when Mr Whelan was with his wife and six year old son. Ms Ozioko was not present, however it appears that Ms Taesha Beynon, Ms Tori Armstrong and Ms Parnia Marshall were present; and
·a second incident occurred at the Zarraffa’s coffee shop on 29 September 2015 when Mr Whelan was accompanied by his son, and Ms Ozioko and Ms Armstrong were present.
An outline of Mr Marshall’s evidence was settled on 3 March 2017 and marked as an exhibit in the proceedings. It included the following:
7.Around 20 September 2015, the Second Respondent, while at the Candy Shop Mansion, and in the presence of Ms Marshall, amongst others, reviewed and selected a series of pictures of the Applicant with women who weren’t his wife, to be used to intimidate the Applicant by way of leaving them in his mailbox for the Applicant’s wife to find.
8.Around 28 September 2015, the Second Respondent organised a number of individuals, including Ms Marshall, to harass and intimidate the Applicant, based on information regarding the whereabouts of the Applicant obtained from a private investigator retained to follow the Applicant.
At the hearing Ms Marshall gave evidence as follows:
Right. And can you tell the court what happened on that occasion?---So that was the night that Travers had his laptop out and he had photos up from his Europe trip with Andrew and what I remember about that is Travers is going through them and, you know, he was laughing and he was like, oh, we will use this one and we will use this one, and Tracey is like the man in this relationship, she will fucking kill him for this and blah, blah, blah.
When you say blah, blah, blah – - -?---Sorry.
- – - just be – - -?---Yes. So he was just, like, rambling on about, like, you know, that he was going to use them for, you know, some sort of reason.
(Transcript 17 March 2017 page 359 lines 22-32)
In relation to events on 28 September 2015, Ms Marshall gave evidence as follows:
Do you recall where you were on that occasion once again in relation to Mr Beynon, the FreeChoice companies and your employment?---Yes. Again, I – it started off probably – I’m not sure what time, maybe from morning to midday. We were at The Candy Shop Mansion and Travers was – had talks about a PI following Andrew and Tracey and that – - -
When you say PI, do you mean – - -?---Personal investigator. That’s what he referred to it as, as a PI.
…
HER HONOUR: Please continue, Ms Marshall?---Yes. So then from there when he said that the PIs were – personal investigators were tracking where Andrew and Tracey were, we got direction off him – like, there was me, Tori Armstrong, Taesha – we were all there and we got direction of Travers to just go to the coffee shop and give him a hard time.
All right. And what did you do as a result of that direction?---From a result of that 20 direction, Taesha and I pretty much arrived there at the – at the same time as Tracey and Andrew did, and we hopped out of the car, we walked into the coffee shop and Andrew and Tracey were – looked pretty distressed at the time, and that’s when Tori Armstrong started coming up to the car and harassing and filming and all that.
Do you recall anything that she said?---That Tori said?
Yes?---Yes. She was saying, like, you fucking pussy, you’re a fucking pussy, blah, blah – sorry, I can’t say blah, blah. Just saying you’re a fucking pussy, you know, how does it feel being a pussy.
HER HONOUR: So which coffee shop was this, please?---Zarraffa’s at Hope Island, just close to 36 River Cove Place.
Thank you.
MR WHITE: And do you recall whether a child was present at this time?---There was. There was a son in the back who I could hear crying through the car that seemed, you know, really, really upset at the time. Her evidence was that she participated in such an incident at Zarraffa’s at Hope Island, close to 36 River Cove Place.
Is that in the back of Andrew and Tracey’s car?---That’s right. Yes.
And that finished. Do you recall how that scene finished?---So how it finished was we pretty much – Tori put, like, a rude sort of sticker on the car – something to do with male strippers or something like that. And then Tracey and Andrew and their son rushed off. They left. And then we went back to The Candy Shop Mansion. And that’s when we came back to Travers and we told him what happened. And he was, like, “Yeah, he is a fucking pussy. Good.” You know, he seemed very pleased by what had just happened.
(Transcript pages 361-362)
In cross-examination Ms Marshall gave the following evidence:
Well, in short, what you’re saying in your evidence is that Mr Beynon instructed you and others to go and harass Mr Whelan?---Yes.
You then did you and harass Mr Whelan?---Yes.
And then you went back to Mr Beynon, told him, and he was pleased with it?---Yes.
(Transcript page 369 lines 11-16)
And later:
MR RONEY: I will change this particular tack. I asked you a moment ago if Mr Beynon – I suggested to you a moment ago that Mr Beynon said nothing to instruct any of the women who went there that day to give Mrs Whelan a hard time. All right. Now, I want an answer to that question. You said no, and then you thought about it. Do you recall him saying anything to anyone about putting a sticker on Mrs Whelan’s – or on the vehicle?---Yes. Tori Armstrong.
Right. And what was that?---It was a Red Hot Strippers male – - -
What was said, is what I’m asking. What did Mr Beynon say?---He said words to the effect of, “Yeah, do that.” Because she – she said that she would do it. And he said, “Yeah, do that.”
And is that something you’ve just remembered, is it?---Not just remembered.
See, I suggest to you that – that going there that day was in no way under instruction from Mr Beynon?---That’s not true.
And that, indeed, there was no private investigator engaged and nor was there any conversation about him being engaged or about one being engaged?---That’s what came out of his mouth and Tori Armstrong’s mouth.
And you most certainly did not report back to Mr Beynon about what had happened?---Yes, we did.
And you most certainly – he most certainly did not respond that he was pleased with what you had done?---Yes, he did.
(Transcriptpage 371 lines 11-37)
In summary, Mr Whelan submitted that:
·He felt defeated and humiliated as a direct consequence of his termination and the subsequent harassment to which he was subjected by the respondents and employees of the first respondent;
·Evidence of Ms Ozioko was that it was not usual procedure for Mr Beynon and other employees to attend the private residence of an employee to collect company property;
·The posting of a security guard outside his house after the termination of his employment was conduct of the respondents seeking to intimidate and threaten him;
·Evidence of Ms Marshall supported his evidence;
·Mr Beynon gave no evidence to the contrary;
·This harassment occurred after the applicant notified the first respondent that he intended to commence these proceedings, and was projected at intimidating him and deterring him from doing so; and
·The harassment and intimidation by the respondents has been deliberate, malicious and continued throughout the course of the proceedings, and he suffered anxiety and stress as a result.
The respondents rely on evidence of Ms Ozioko. In her affidavit affirmed 19 September 2016, Ms Ozioko deposes that:
·At the time of the termination of Mr Whelan’s employment, Mr Whelan was still in possession of a laptop and iPhone provided to him by the first respondent pursuant to the terms of his employment agreement and she was concerned that Mr Whelan would try to download company records from those devices;
·On the evening of 24 August 2015, Ms Ozioko and Mr Beynon drove to Mr Whelan’s home to ask for the return of the laptop, iPhone and keys to the office. They arrived at Mr Whelan’s home at approximately 5.15 pm and spoke with Mrs Whelan who informed them that Mr Whelan was not at home. As they were leaving Mr Whelan arrived at home, however, he refused to speak with Mr Beynon and Ms Ozioko;
·Ms Ozioko called the police;
·Ms Ozioko returned with a security guard to Mr Whelan’s residence at approximately 6.00 pm to demand the return of the first respondent’s property. Mrs Whelan handed the office keys to the security guard but refused to hand over the laptop computer or iPhone;
·On 26 August 2015, a representative of the first respondent’s lawyers collected the laptop and iPhone from Mr Whelan’s house and delivered them to Ms Ozioko; and
·Hard copy records related to Mr Whelan’s employment with the first respondent were missing from the first respondent’s files after Mr Whelan’s termination. She had viewed security footage which showed Mr Whelan departing the office of the first respondent on 24 August 2015 with a large volume of hard copy files.
Ms Ozioko also gave evidence that she was present at Zarraffa’s coffee shop during an incident in September 2015 when Mr Whelan was present. Her evidence was as follows:
MR RONEY: Could I ask you please about an incident which occurred at Zarraffa’s Coffee Shop in late September 2015 for which you were present?---Yes.
And involved – was it Mr and Mrs Whelan?---No. Mr Whelan was the only person present.
Just Mr Whelan. And did you – were you present that day when that incident occurred?---Yes, I was.
All right. How did you and the others that were with you come to be there?---We went down to the coffee shop to have a meeting with Tori Jackie Armstrong who’s the person that manages the promotional models because we had an upcoming event.
HER HONOUR: Sorry. Because what?---We had an upcoming event.
Thank you.
MR RONEY: When you went, did you have any idea or inkling that Mr Whelan was there?---We did see him as we arrived. Yes.
No, but as you went?---Prior to? No. We did not.
So was it pre-arranged that anything would happen to intimidate or otherwise harass him that day?---No, it was not.
All right. And so did you say anything yourself to Mr Whelan in the coffee shop?---No, I did not.
Who was speaking?---Jackie Armstrong was – they were exchanging words back and forth as was Andrew Whelan.
So they had words with each other, did they?---They did.
All right. And – all right. Did you have anything to say in that context at all?---No. I was a little uncomfortable, but the words were going back and forth between both Ms Armstrong and Mr Whelan.
Had, to your knowledge, Mr Beynon instructed any of those on your side of the business to go there to have this conversation with him?---No.
(Transcript pages 399-400)
The respondents challenge Mr Whelan’s claim of psychological damage. They submit that Ms Ozioko’s evidence conveys a very different account of the incident at Mr Whelan’s house on the evening of 24 August 2015; that Ms Marshall’s evidence concerning the incident involving her at Zarraffa’s coffee shop should be treated with caution; and that any harassment of Mr Whelan at the coffee shop was limited and not caused by any of the adverse action alleged to have been taken by the first respondent. They also submit that the Court should prefer Ms Ozioko’s evidence concerning the incident on 29 September 2015 to that of Mr Whelan.
Turning now to Mr Whelan’s claim for non-economic loss and damage I make the following observations.
First, s 545 of the FW Act empowers the Court to order compensation for non-economic loss by way of distress, hurt or humiliation. Qualifications to that power are that the Court::
·considers the order appropriate;
·is satisfied that a person has contravened, or proposes to contravene, a civil remedy provision; and
·may order compensation for loss that a person has suffered because of the contravention.
Mr Whelan relied on a number of authorities which have examined this power, including Lai v Chance Trading Pty Ltd [2015] FCCA 441, McIlwain v Ramsey Food Packaging Pty Ltd (No 4) [2006] FCA 1302; (2006) 158 IR 181 and Richardson v Oracle Corporation Australia Pty Ltd [2014] FCAFC 82; (2014) 223 FCR 334.
Second, as I have already found, the first respondent contravened s 340 of the FW Act which is a civil remedy provision. I have also found that Mr Beynon was involved in those contraventions.
Third, the power of the Court under s 545(2) is to order compensation for the loss the person has suffered because of the contravention or contraventions. As Barker J observed in Australian Licenced Aircraft Engineers Association at [423] in the context of a claim for compensation pursuant to s 545, an appropriate causal connection between the contravention and the loss claimed is required. In that case the relevant contraventions related to the making of a negative assessment and the provision of that negative assessment to Garuda Indonesia, resulting in the worker losing his job and his visa and obliging him to return to Indonesia to find work. His Honour accepted the employer’s submission that no medical evidence had been adduced to support a finding that the contravention caused the worker stress, but nonetheless found that the dismissal and the fact of the negative assessment together relevantly hurt and humiliated the worker as he claimed and was a direct consequence of the contraventions found. Materially his Honour continued:
443However, the power of the Court under s 545(1) and (2) to make appropriate orders following contravention including an order for compensation is quite divorced from this type of contractual consideration. As a matter of broad public policy, the Parliament of Australia has provided that the Court may give appropriate relief where contravention is proved. Relief in these circumstances helps to uphold the policy indicated in the FW Act that, amongst other things, contraventions of the freedom of association provisions should not occur and that appropriate orders should be made to remedy the contravention of such provisions. There is, therefore, in my view, no obvious policy consideration that militates against the making of a compensation order under s 545(1) or a compensation order under s 545(2), for the sorts of reasons that have inhibited the award of damages at common law for a breach of contract which is attended by shock, distress or humiliation.
Subsequently his Honour added:
449Additionally, I do not consider that the word “loss” in s 545(2), to the extent this provision must be relied upon for the making of a financial compensation order, limits the loss that may be claimed for economic loss. While the respondent contends that a distinction should be drawn between “loss” and “damage”, and that shock, distress and humiliation should be considered as “damage”, and not as “loss”, I find the distinction elusive and unhelpful. Shock, distress and humiliation may be considered, where it exists, as an injury the person suffers which is apt to be described as non-economic loss or damage.
I respectfully adopt these statements of principle by his Honour.
Turning to the case before me, I accept that Mr Whelan’s dismissal was in contravention of s 340 of the FW Act, and that he felt humiliated as a result. I accept that he felt humiliated by the attendance of Mr Beynon and Ms Ozioko, and subsequently Ms Ozioko and a security guard, at his home to recover property of the first respondent. Further, and in line with comments of Barker J, I do not consider that Mr Whelan is precluded from claiming non-economic loss because he has not proven psychological damage by medical evidence.
To that extent, I consider that Mr Whelan is entitled to an order for compensation by the respondents.
However, I do not find other aspects of his claim persuasive insofar as he claims a causal connection between hurt and humiliation, and his dismissal. In particular:
·I consider that Mr Whelan’s claim of hurt and humiliation in being required to explain to other employers, months if not years after his dismissal, that he was dismissed from his employment with the first respondent, is too remote from the adverse action of the first respondent to support a finding of compensation.
·Further, I note that Mr Whelan’s contract entitled him to be dismissed without reason, at any time during his employment. If Mr Whelan had been dismissed without conduct involving adverse action he would be precisely in the same position as he currently claims (namely, of being required to explain to subsequent employers that he had been dismissed) but there would be no issue of the respondents being liable for compensation.
·I also note the large volume of evidence that Mr Whelan very much disliked both the respondents and his job, that he only remained at the job because he needed the money, and that he harboured some ideas of harming Mr Beynon with the Australian Taxation Office. To that extent I am not persuaded that Mr Whelan suffered hurt in being dismissed, other than the fact that it was the respondents who made the decision that his employment cease rather than Mr Whelan.
·Although I consider that Mr Whelan’s version of events in late September 2015 to be plausible, I also consider that Ms Ozioko’s evidence that she did not actively seek or engage in harassment of Mr Whelan, was plausible. The evidence before me was that Mr Whelan attended the Zarraffa’s coffee shop two days in succession, presumably because in light of its location it was convenient to him to do so, and that people associated with Mr Beynon including Ms Ozioko attended the same coffee shop for the same reason rather than for the purpose of seeking out Mr Whelan. Indeed on balance it is difficult to identify why Ms Ozioko, who appeared busy in her role with the first respondent, and further gave every appearance of being professional, would have bothered to deliberately engage in malicious and spiteful harassment of Mr Whelan.
·I find that Ms Beynon, Ms Armstrong and Ms Marshall engaged in malicious and spiteful harassment of Mr Whelan and his family on 28 September 2015, and that Ms Armstrong appeared to engage in incidents both on 28 and 29 September 2015. However, although it is possible that this harassment was with the approval of Mr Beynon, evidence of Mr Beynon’s involvement in the relevant incidents is weak. It is quite possible that the harassment was orchestrated by Ms Beynon or Ms Armstrong, although in the absence of evidence from either it is not possible to be sure. Ms Marshall’s credibility in respect of his evidence is, in my view, tainted by the fact that she was one of the participants in the harassment of Mr Whelan. Further, that Mr Beynon may have approved of the harassment does not establish either that he directed it, or more relevantly that there was a causal connection between that conduct and the adverse action of the first respondent (to which Mr Beynon was an accessory) within the meaning of s 545 of the FW Act. In this respect, I note in particular that this conduct was more than one month after the termination of Mr Whelan’s employment. It may have been that Mr Beynon and his wife and friends did not like Mr Whelan and were prepared to either engage in or condone malicious conduct towards him – that, however, is not of itself compensable under s 545 of the FW Act.
I also note that the attendance by Mr Beynon and Ms Ozioko at Mr Whelan’s home on the afternoon of 24 August 2015, while unusual, was for the purpose of recovering property of the first respondent which Mr Whelan had in his possession as general manager, and which Mr Beynon and Ms Ozioko feared could be used by Mr Whelan to cause damage to the first respondent. Indeed the concern expressed by Ms Ozioko in her evidence as to potential damage she feared Mr Whelan could inflict on the first respondent was to some degree borne out in communications between Mr Whelan and his wife in which Mr Whelan discussed the prospect of causing harm to Mr Beynon.
Further, although Mr Whelan expressed hurt and humiliation at a security guard being posted to his home, his evidence was that the summoning of the police resulted in the security guard’s expeditious removal. To that extent Mr Whelan was successful in “turning the tables” on the respondents, and humiliating them by drawing the attention of the police to their conduct. It is not clear to me why Mr Whelan is entitled to compensation in such circumstances.
I consider that Mr Whelan is entitled to a modest sum for the hurt and humiliation he suffered as a result of being dismissed by the first respondent in contravention of s 340 of the FW Act, and for the attendance at his home of Mr Beynon, Ms Ozioko and the security guard. I consider that the amount of $60,000 he seeks is disproportionate – an award of compensation in the amount of $5,000 is appropriate.
Mr Whelan does not make separate claims for compensation against the first and second respondents. On the facts of this case, particularly as I have found that the first respondent in dismissing Mr Whelan was acting at the direction of the second respondent, it is appropriate to order that the first and second respondents be jointly and severally liable to pay Mr Whelan this award of compensation.
Payment in lieu of notice of termination and unpaid leave entitlements
I have already found that Mr Whelan was entitled to, but not paid, amounts in lieu of notice of termination of employment and accrued leave, and this failure to pay him contravened the FW Act. The appropriate compensation that directly and causally flows from these contraventions is:
·An amount in lieu of notice, and
·An amount equal to Mr Whelan’s unused annual leave entitlements
Mr Whelan’s unused annual leave entitlements are not in dispute. Mr Whelan is entitled to the sum of $17,160.40 for untaken but accrued annual leave (calculated as 109.53 hours at an hourly rate of $156.6731).
In relation to the appropriate payment in lieu of notice, the respondents submit that Mr Whelan is entitled to 2 weeks’ notice of termination whereas Mr Whelan claims 3 weeks.
As Mr Whelan had been employed by the first respondent more than one year, but less than three years, cl 9.1 of Mr Whelan’s contract of employment entitles him to three weeks’ notice, or payment in lieu of three weeks. Mr Whelan is entitled to the sum of $17,625.72 in lieu of notice (calculated at three weeks, being 112.5 hours at an hourly rate of $156.6731).
Loss associated with relocating from Sydney to the Gold Coast
A considerable amount of evidence was adduced as to losses Mr Whelan experienced in relocating from Sydney to the Gold Coast, including in relation to the value of Mr Whelan’s previous home in Sydney. For reasons I have already given, I am not persuaded that, even if Mr Whelan could establish losses associated with such relocation, the respondents are responsible for them. I am not satisfied that the conduct of the respondents associated with Mr Whelan’s decision to accept employment with the first respondent warrants compensation of Mr Whelan.
This aspect of Mr Whelan’s claim is not sustainable.
Interest
I have found that Mr Whelan is entitled to compensation in the following amounts:
·the sum of $17,625.72 in lieu of notice
·the sum of $17,160.40 for untaken but accrued annual leave
·the sum of $5,000 in compensation for non-economic loss suffered by him because of the contravention of s 340 of the FW Act.
This totals $39,786.12 in compensation.
Mr Whelan seeks interest on any judgment for compensation.
Section 547 of the FW Act provides
(1)This section applies to an order (other than a pecuniary penalty order) under this Division in relation to an amount that a person was required to pay to, or on behalf of, another person under this Act or a fair work instrument.
(2)In making the order the court must, on application, include an amount of interest in the sum ordered, unless good cause is shown to the contrary.
(3)Without limiting subsection (2), in determining the amount of interest, the court must take into account the period between the day the relevant cause of action arose and the day the order is made.
The Federal Court of Australia Interest on Judgments Practice Note (GPN-INT) (Practice Note) issued on 18 September 2017 provides guidance in regard to interest on judgments arising under s 51A of the Federal Court of Australia Act 1976 (Cth) as well as interest up to judgment arising under s 547 of the FW Act. The Practice Note provides for the following rates:
(a)in respect of the period from 1 January to 30 June in any year – the rate that is 4% above the cash rate last published by the Reserve Bank of Australia before that period commenced; and
(b)in respect of the period from 1 July to 31 December in any year – the rate that is 4% above the cash rate last published by the Reserve Bank of Australia before that period commenced.
Mr Whelan was dismissed on 24 August 2015. In addition to total compensation in the amount of $38,286.12 he is entitled to interest on that amount from 24 August 2015 to the date of judgment, calculated in accordance with the Practice Note.
Civil Penalties
The applicant seeks the imposition of pecuniary penalties on the respondents for contravention of the FW Act and the ACL. For reasons I have given, the respondents have not contravened the ACL and the issue of pecuniary penalties does not arise in that context.
The situation is different in relation to the FW Act. I have found that the first respondent contravened s 340(1) of the FW Act in respect of the dismissal of Mr Whelan, and s 44(1) of the FW Act in respect of its failure to pay Mr Whelan his entitlements. I have also found that Mr Beynon was involved in those contraventions.
Mr Whelan also seeks an order pursuant to s 546(3)(c) of the FW Act that any pecuniary penalties imposed on the respondents be paid to him personally.
Although Mr Whelan has filed written submissions in relation to this issue it is appropriate that the quantum of penalty be separately addressed in light of my reasons for judgment. I will hear the parties in respect of appropriate timetabling orders for filing of submissions on this point.
Costs
Similarly, I will make timetabling orders for filing of submissions in respect of costs.
I certify that the preceding three hundred and twenty-nine (329) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Collier. Associate:
Dated: 19 December 2017
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