DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Lance Palpal-Latoc
v
Cloud Catcher Pty Ltd
(U2018/1604)

Application for an unfair dismissal remedy.

[1] On 17 February 2018 Mr Lance Palpal-Latoc (Applicant) made an application to the Fair Work Commission (Commission) pursuant to section 394 of the Fair Work Act 2009 (FW Act) for a remedy in respect of the termination of his employment by Cloud Catcher Pty Ltd (Respondent/Labradoodles) where he was employed as a Puppy/Dog Carer.

[2] The Respondent is a breeder of Labradoodles.  Apparently a Labradoodle is a cross between a Labrador Retriever and a Poodle.  However, the Respondent’s website states that the dogs “also come from a number of other parent breeds, including the Irish Water Spaniel, Curly Coated Retriever, American Cocker Spaniel and English Cocker Spaniel”.  Apparently, such cross-breed dogs are highly sought after. In light of the experience of Mr Palpal-Latoc in this matter, one can only hope that the Respondent takes better care of the puppies at their farm, than they do of the humans in their employ.

[3] On 1 March 2018 Labradoodles filed a response to the unfair dismissal application. In its reply Labradoodles objected to the Commission exercising jurisdiction in relation to the matter on the basis that, it submitted, the Applicant was an ad-hoc and irregular casual. By email on 28 March 2018 the Respondent’s representative sent an email to the Commission withdrawing the objection in the following terms,

“Our client has instructed that they accept the Applicant’s submission that he worked systematic and regular basis. They do not press the minimum employment period objection neither.” (sic)

[4] However, before me at the Determinative Conference conducted on 6 June 2018 the Respondent’s representative indicated that she was now instructed to maintain the objection. 1  I deal with this issue below.

[5] Conciliation was attempted, but the matter remained unresolved and it was necessary to program the matter for determination.

[6] On 27 April 2018 I programmed the matter for hearing. I also sought submissions from the parties about whether the Commission should conduct either a Determinative Conference (section 398) or a Hearing (section 399) in relation to the matter. Taking account:

a) any differences in the circumstances; and

b) the wishes;

of the parties to the matter, and considering whether a Hearing would be the most effective and efficient way to resolve to the matter. I decided to conduct a Determinative Conference.

[7] At the Determinative Conference on 6 June 2018:

a) the Applicant represented himself. He had previously filed a Witness Statement (Exhibit A1). He was cross-examined. He made no concessions during the same.

b) the Applicant called his mother, Ms Satoko Palpal-Latoc to give evidence. She was also a previous employee of Labradoodles. She filed a Witness Statement (Exhibit A15) and made herself available for cross examination.

In large part Ms Palpal-Latoc’s evidence related to her own experiences as an employee and the cessation of her employment. Her evidence was not of very much probative value to the issues in dispute relating to the Applicant.

c) Labradoodles was represented by Ms J Katsuda from Katsuda Synergy Lawyers.

d) Labradoodles called Mr Makoto Nakamura, Senior Manager to give evidence. He had previously filed a Witness Statement (Exhibit R3). He was cross-examined.

It is to be noted that Mr Nakumura was appointed to his position on 1 April 2018. That is to say he took up his position after the termination of the Applicant’s employment. Consequently, Mr Nakumura had no direct knowledge of the events in question. He said that he believed his evidence to be true because people (not-named) had reported those matters to him. 2 His evidence was of little probative value.

[8] It is also important to note that Labradoodles did not call Ms Tomoko Shioya to give evidence. Ms Shioya was the Applicant’s manager. Her absence was not sufficiently explained. 3 Consequently, I was faced with a situation where there was, in effect, no witness from the Respondent who could give a first hand or direct account of the matters in dispute. The only person who could give a first hand or direct account of matters was the Applicant. Having issued Directions for the filing and service of evidence on 27 April 2018 the Respondent had every opportunity to put on evidence, but, for reasons not disclosed, failed to file evidence of any real probative value. This is not a criticism of Ms Katsuda. She was professional and did her best to assist the Commission and advocate on behalf of her client. However, she was clearly hamstrung by the paucity of instructions received from her client.

[9] In advance of the Determinative Conference the parties filed the following submissions, that I have had regard to in coming to this decision:

a) email from Respondent to Applicant dated 8 February 2018 (Exhibit A2);

b) email from Applicant to Respondent dated 8 February 2018 (Exhibit A3);

c) Cloud Catcher Pty Ltd Employment Policies and Procedures dated 01/07/2017 (Exhibit A4);

d) Staff Manual (Exhibit A5);

e) Applicant's Offer of Employment dated 30/06/2017 (Exhibit A6);

f) Applicant's Termination Email dated 17/02/2018 (Exhibit A7);

g) Email To Applicant Re Roster Change Dated 16/02/2018 (Exhibit A8);

h) Further Email To Applicant Dated 16/02/2018 (Exhibit A9);

i) Email Dated 12/02/2018 (Exhibit A11);

j) Email dated On February 2018 (Exhibit A10);

k) Email To Applicant With List Of Questions Dated 08/02/2018 (Exhibit A12);

l) Email Dated 10/02/2018 (Exhibit A13);

m) Bundle Of Pay Slips (Exhibit A14);

n) Submissions Of Respondent Dated 25/05/2018 (Exhibit R1);

o) Respondent's Outline Of Argument/Objections (Exhibit R2); and

p) Time Recording Sheets (Exhibit R4).

Background

[10] The following matters were either agreed between the parties or not otherwise substantially contested (primarily because the Respondent did not call any witnesses with first hand or direct knowledge of the events in question).   Consequently, I make the following findings of fact:

a) The Applicant was employed from 27 September 2015 to 17 February 2018. 4

b) The Applicant was a casual employee. He was primarily engaged to work as a “kennel hand”. He was paid $22.86 an hour for weekday work and $26.29 an hour for weekend work. Consequently, the Applicant’s average hourly rate was $24.56.

c) The payslips tendered by the Applicant evidence repetitive engagement dating back to September 2015 and a plan to when he was rostered.

While I accept that the Applicant worked more hours during university holidays, over the period of his employment, he at least usually worked on Saturdays each week, usually 9am to 3pm.

The accepted test is that it is the employment that must be on a regular and systematic basis, not the hours worked. 5

Further,

• the term ‘regular’ implies a repetitive pattern and does not mean frequent, often, uniform or constant.

• the term ‘systematic’ requires that the engagement be ‘something that could fairly be called a system, method or plan’.

Consequently, I find that the Applicant was employed on a regular and systematic basis and that he had a reasonable expectation that it would continue to be so. Consequently, I reject the jurisdictional objection raised by the Respondent. It was correctly abandoned on 28 March 2018, and should have remained so.

d) Between September 2015 and October 2017 the Applicant’s then manager, Seiko Yamada, did not raise any performance issues with him. In fact, he received positive feedback on his performance. 6

e) Between November 2017 to February 2018 the Applicant was under the managerial prerogative of Ms Shioya. Ms Shioya’s main form of communication with the Applicant was email.

f) Up until 8 February 2018 the Applicant was not aware that there were any concerns about his performance. When a senior co-worker resigned, Ms Shioya approached the Applicant and asked him what his plans were. He stated that he enjoyed his job. Ms Shioya told the Applicant she would be looking for new staff, but that, as the now senior staff member, he would have priority over the shifts he wanted.

g) On 8 February 2018 (at 1.52 pm), the Applicant received an email from Ms Shioya in the following terms, 7

“I want you answer some questions below.

1

7/1/18 you received 10AUD discounted boarding fee from Ms Leah, and you didn’t confirm it before you explain to customer, and also didn’t report to me.

Did you forget to confirm and report or you think you have authority to do that?

2

Have you ever taught from the former manager that “shampoo” include nail clip and ear clean as require?

3

Have you ever taught from former manager that you need to wash floor whenever dog stayed night”

h) The Applicant responded (at 2.14 pm),

“1 I have no idea what you’re talking about

2 No

3 I always wash the kennel floor and I have proof that I do”

i) On 8 February 2018 (at 2.33 pm), the Applicant received another email from Ms Shioya in the following terms,

“Thank you for answering.

One further question

Have you ever clipped a dog’s nail, and do you know how to wash dog’s ear?

j) The Applicant responded (at 2.41pm), 8

“No, I’m a kennel attendant not a groomer.”

k) On 10 February 2018 (at 12.05 pm), the Applicant received an email 9 from Ms Shioya in the following terms,

“Some trial casual staffs will start to work next week.

The number of locker and main keys is not enough all members.

I will evaluate all members includes you in skill, experience (your advantage) basic common sense (behaviour as a member of business organisation, tort customer, and as a employee, the cloud catch up is no more a dog playing school circle)

and will decide the eligible members to rebuild this organisation.

Every staff will use locker only in working day and share master key for a while.

I will collect master key and locker key later, please take your items to hone after today’s work and take back them in your work day for a while.

Sorry for a inconvenience.”

l) On 12 February 2018 (at 1.53 pm), the Applicant received an email 10 from Ms Shioya in the following terms,

“I will judge comprehensively each staff.

I think in this small company,

all of the staff need to understand the mission of the business.

We are labradoodle breeder and provide

puppies to people who are eager to start with our labradoodle.

To have a dog, is the drastic change of people.

We don’t merely breeding,

we are involved someone’s life.

To make good quality of business

I want every staff deeply understand all protocol, and have motivation,

it automatically leads staff to

clean well, don’t deal with customer in rude attitude.

I also take the relationship with me as big deal.

I need to leave the staffs in the same direction.

I can’t leave kennel whoever can’t communicate with me.

Imagine if you were the owner,

and want to improve the organisation,

what kind of people you want to hire?

You want to work with a person,

never response what you’ve talked to?

I will select the people who meet above,

some you’ve cleared already,

and some I can’t judge now.

I know you are smart, or do computer,

kind, not good at cleaning up (not a big problem), love dogs, doesn’t know

the right procedure as a member of business group.

I don’t know when I figure out,

if you want to say you can’t wait until finish

to evaluate,

you can say so.

I’m convinced you are good enough that you can find another casual job soon,

moreover it might be better in your career to

know what his work in real society in prior to your permanent job hunting.”

m) On 13 February 2018 (at 10.58 am) the Applicant was asked via email whether he would like to be involved in breeding tasks at Labradoodles. 11 The Applicant agreed.

n) On 16 February 2018, the Applicant was given a series of tasks to complete by email. This included the breeding task for the next day (the 17^th) which involved driving. 12

o) On the same day, the Applicant was informed by email that his roster needed to change because he was unable to drive the company car (because he was not 25 years old). 13 Ms Shioya also wrote,

“I will finish the assessment until next week,

then let you know

your position.”

p) On 17 February 2018 the Applicant received an email from Ms Shioya terminating his employment. 14 She wrote,

“I did final decision that you are

out of member of Cloud Catcher.

There are some reasons,

the main reason usual work schedule

never meet me,

so I can’t teach you directly a new procedure

or acquired skill as kennel hands.

In the new organisation, I will arrange staffs

can work both weekdays and weekend

to share information in mind to maintain emission deeply.

We need to be a team, sharing missions

and be professional.

You are not idiot, should notice many things

changed professionally.

One more big reason,

I want you to think yourself,

that you are a member of Cloud Catcher

and I ask you understand well all of the

tasks.

Family Care Home is a main procedure

of this business.

And you are also a member of FCH owner.

I gave you a hint from the scratch,

and observed whether you notice what you should do.

Think if you were a leader,

and want to improve running organisation.

I’m still believe that you are originally a

good, skilled, pure, kind man.

As my personally perspect,

I didn’t want to lose you,

but I’m a manager, should always

take advantage of group.

As I said, you are good enough to find

another casual job using your ability soon.

To be honest, diligent, always find something to do, always care for and consider other,

is the way to success.

Please find a good mental to imitate

in your next casual job.

And it’s a time you should start to

be associated with a job directly connect

to your future.

I’ve been thinking what is really good for you.

You are filled with possibility,

don’t squash the potential by yourself.

You are the only one create your future,

and in society, every response will be on you.

I’m appreciated from my heart

that you really helped me a lot,

and strongly hope you open your eyes

and toward a good direction.”

q) Since 5 April 2018, the Applicant has been employed in a new job at the rate of $24.79 an hour. This hourly rate is marginally more favourable when compared with the Applicant’s average hourly rate with the Respondent of $24.56.

Labradoodle’s case

[11] Labradoodles’ submitted that, 15

a) The Applicant was a casual employee who worked irregular rosters based on the operational needs of the business and the Applicant’s availability. While the Applicant was rostered mainly on Saturdays, his hours varied week to week. For example the Applicant was rostered more outside his university terms. 16 The availability of the Applicant was checked actively through a calendar system where employees marked their availability for upcoming weeks.17

b) When a new manager and management structure was introduced in November 2017, the Applicant’s poor performance became apparent.

c) The Applicant’s job description was clarified, and the Applicant was warned about his performance and the possibility of termination should he not improve.

d) Even if the Commission has jurisdiction to hear the substantive dismissal matter, that Labradoodles has taken all of the necessary steps under Section 387 of the FW Act to warn the Applicant about his performance with the possibility of termination should he not improve.

e) Even if the Applicant is found to have been unfairly dismissed, since he has found employment with a higher base rate only one month after his employment with Labradoodles ended, that by reference to Section 392 of the FW act, that he has not suffered any substantial loss.

[12] Mr Makato Nakamura, Senior Manager of Labradoodles, gave hearsay evidence to the following effect, 18

a) The Applicant was employed from 9 November 2015 to 17 February 2018.

b) The Applicant was a casual employee who worked irregular rosters based on the operational needs of the business and the Applicant’s availability through a calendar system.

c) Prior to Ms Shioya, the business was not performing well, with most mating failing and not enough puppies being bred as a consequence.

d) Since a new management structure was introduced in November 2017, the business has been running more effectively.

e) In the last week of January 2018, someone acting on behalf of Labradoodles warned the Applicant that they needed to improve their performance in line with the staff manuals to remain employed. The staff manuals were then displayed on the kitchen notice board. The manual contains the words “IF YOU DON’T DO ANYTHING ABOVE, YOU WILL LOSE YOUR JOB HERE”. Around the same time Labradoodles hired several new employees to fill the position of the Applicant and the “lack of skill” of existing employees.

f) In the first weekend of February, someone acting on behalf of Labradoodles told the Applicant and other existing employees to return their keys as there were not enough given the recent recruitment. The Applicant complied with this order “some days later”. On the same day the Applicant was told that he had to show actual improvement to retain his position.

g) On a number of occasions someone acting on behalf of Labradoodles told the Applicant that he was unable to perform the task of shampooing and nail clipping, both of which are essential tasks. He was given the opportunity to learn these skills but was unable to do so due to his university schedule.

h) The Applicant is unable to drive a company car as he is under 25, a task kennel hands are intermittently required to perform. Nor is he able to clip the nails of the dogs.

i) On 7 & 8 January 2018, the Applicant corrected a $10 difference in a customer’s invoice which he was questioned about. This did not form part of the reasons for dismissal.

j) On 12 February 2018 the Applicant requested an update as to the assessment of his employment to which Labradoodles replied that it should be completed within a week.

k) On 16 February 2018 the Applicant’s roster was changed due to his inability to drive a company car.

l) On 17 February 2018, Labradoodles terminated the Applicant’s casual employment via email. This was done after assessing the Applicant’s competency after being warned.

Protection from Unfair Dismissal

[13] An order for reinstatement or compensation may only be issued where the Commission is satisfied the Applicant was protected from unfair dismissal at the time of the dismissal.

[14] Section 382 sets out the circumstances that must exist for the Applicant to be protected from unfair dismissal:

“382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

(b) one or more of the following apply:

(i) a modern award covers the person;

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.

[15] The Respondent disputed that the Applicant had served the minimum employment period on the basis that he was not a regular and systematic casual and, consequently, had not completed the minimum employment period. For the reasons I have set out above, I reject that submission.

[16] The Commission, as presently constituted, is satisfied, the Applicant completed the minimum employment period, and earned under the High Income Threshold. Consequently, the Commission, as presently constituted, is satisfied the Applicant was protected from unfair dismissal.

[17] I will now consider if the dismissal of the Applicant by the Respondent was unfair within the meaning of the FW Act.

Was the dismissal unfair?

[18] A dismissal is unfair if the Commission is satisfied, on the evidence before it, that all of the circumstances set out at s.385 of the FW Act existed. Section 385 provides the following:

“385 What is an unfair dismissal

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

(a) the person has been dismissed; and

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

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

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

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

Was the Applicant dismissed?

[19] A person has been unfairly dismissed if the termination of their employment comes within the definition of “dismissed” for purposes of Part 3–2 of the FW Act. In the present matter there is no contest that the Respondent terminated the Applicant’s employment on its own initiative.

[20] I find that the Applicant was dismissed from his employment with the Respondent within the meaning of s.386 of the FW Act.

Was the dismissal consistent with the Small Business Fair Dismissal Code?

[21] A person has not been unfairly dismissed where the dismissal is consistent with the Small Business Fair Dismissal Code (Code). In its F3 - Employer Response the Respondent did not claim to have complied with the Code.

[22] In all the circumstances, the Commission, as presently constituted, is satisfied the dismissal of the Applicant was not consistent with the Code.

Was the dismissal a genuine redundancy?

[23] The Respondent did not submit that I should dismiss the application because the dismissal was a case of genuine redundancy.

[24] Consequently, I find that the dismissal was not a case of genuine redundancy within the meaning of s.389 of the FW Act.

Harsh, unjust or unreasonable

[25] Having been satisfied of each of s.385(a),(c)-(d) of the FW Act, the Commission must consider whether it is satisfied the dismissal was harsh, unjust or unreasonable. The criteria the Commission must take into account when assessing whether the dismissal was harsh, unjust or unreasonable are set out at s.387 of the FW Act:

“387 Criteria for considering harshness etc.

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

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

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

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

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

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

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

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

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

[26] The ambit of the conduct which may fall within the phrase ‘harsh, unjust or unreasonable’ was explained in Byrne v Australian Airlines Ltd [1995] HCA 24; (1995) 185 CLR 410 at 465 by McHugh and Gummow JJ as follows:

.... It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.

[27] I am under a duty to consider each of these criteria in reaching my conclusion. 19

[28] I will now consider each of the criteria at s.387 of the FW Act separately.

Valid reason - s.387(a)

[29] The Respondent must have a valid reason for the dismissal of the Applicant, although it need not be the reason given to the Applicant at the time of the dismissal. 20 The reasons should be “sound, defensible and well founded”21 and should not be “capricious, fanciful, spiteful or prejudiced”.22

[30] The email that terminated the Applicant’s employment on 17 February 2018 is the only document that provides any insight into the mind of the decision-maker, Ms Shioya, about the reasons for dismissal. In short, they appear to be related to:

a) the Applicant’s work schedule,

b) the Applicant not understanding the tasks required of him, and

c) the Applicant not being “a member of Cloud Catcher” (one assumes this to mean that he was not a team player).

[31] It might be that all of the criticisms made of the Applicant by Ms Shioya were valid. It might be that they could have provided a valid reason or reasons for the dismissal of the Applicant. However, the difficulty faced by the Respondent is that it led no evidence to support any finding that there was a valid reason or reasons for the dismissal of the Applicant.

[32] The Applicant, who attended the Determinative Conference and made himself available for cross examination, denies that there was any reason associated with his conduct or performance that would justify the termination of his employment.

Having read the email exchanges between the applicant and Ms Shioya in the lead up to the termination of the Applicant’s employment, the only conclusion is that the reasons advanced by Ms Shioya were capricious, fanciful, spiteful or prejudiced. There is no evidence to support a finding that any of the reasons with sound, defensible or well-founded.

[33] Consequently, I find that there was no valid reason or reasons for the dismissal.

Notification of the valid reason - s.387(b)

[34] Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made, 23 in explicit terms24 and in plain and clear terms.25 In Crozier v Palazzo Corporation Pty Ltd26 a Full Bench of the Australian Industrial Relations Commission dealing with similar provision of the Workplace Relations FW Act 1996 stated the following:

“[73] As a matter of logic procedural fairness would require that an employee be notified of a valid reason for their termination before any decision is taken to terminate their employment in order to provide them with an opportunity to respond to the reason identified. Section 170(3)(b) and (c) would have very little (if any) practical effect if it was sufficient to notify employees and give them an opportunity to respond after a decision had been taken to terminate their employment. Much like shutting the stable door after the horse has bolted.” 27

[35] In the present matter the Applicant found out about the purported reasons for dismissal when he received the email from Ms Shioya on 17 February 2018. That was the first he had heard of the issues that she raised.

[36] For this reason I find the Applicant was not notified of the reason for the dismissal.

Opportunity to respond - s.387(c)

[37] An employee protected from unfair dismissal must be provided with an opportunity to respond to any reason for dismissal relating to the conduct or capacity of the person. This criterion is to be applied in a common sense way to ensure the employee is treated fairly and should not be burdened with formality. 28

[38] I have already observed that the first time the Applicant heard about the purported reasons for dismissal was when he received the email from Ms Shioya on 17 February 2018. There is no evidence that prior to this date these issues, that might be said to relate to his conduct or capacity, were ever raised with the Applicant. Further, the Applicant was not provided with an opportunity to respond the same.

[39] I find the Applicant was not given an opportunity to respond to the reason for the dismissal.

Unreasonable refusal by the employer to allow a support person - s.387(d)

[40] Where an employee protected from unfair dismissal has requested a support person be present to assist in discussions relating to the dismissal, the employer should not unreasonably refuse that person being present.

[41] There was no termination meeting. The termination was communicated by email. There was no offer for the Applicant to have a support person. Consequently, I find the Respondent did not unreasonably refuse to allow the Applicant to have a support person present at discussions relating to the dismissal.

Warnings regarding unsatisfactory performance - s.387(e)

[42] Where an employee protected from unfair dismissal is dismissed for the reason of unsatisfactory performance, the employer should warn the employee about the unsatisfactory performance before the dismissal. Unsatisfactory performance is more likely to relate to an employee’s capacity than their conduct. 29

None of the evidence establishes that the Applicant was ever warned about his performance. Issues were raised with him by Ms Shioya, but the manner in which they were raised did not constitute a warning about unsatisfactory performance as that phrase is properly understood.

[43] I find the Respondent did not warn the Applicant about their unsatisfactory performance before the dismissal.

Impact of the size of the Respondent on procedures followed - s.387(f)

[44] The size of the Respondent’s enterprise may have impacted on the procedures followed by the Respondent in effecting the dismissal.

[45] The procedures in this matter were non-existent. It could be said that the Respondent’s procedures had “gone to the dogs”. Consequently, I find the size of the employer’s enterprise did impact on the procedures followed in effecting the dismissal.

Absence of dedicated human resources management specialist/expertise on procedures followed - s.387(g)

[46] The absence of dedicated human resource management or expertise in the Respondent’s enterprise may have impacted on the procedures followed by the Respondent in effecting the dismissal.

[47] I find the absence of any such management or expertise did impact on the procedures followed by the Respondent in effecting the dismissal.

Other relevant matters - s.387(h)

[48] Section 387(h) provides the Commission with a broad scope to consider any other matters it considers relevant. No submissions were made about other matters relevant to the determination of whether the dismissal of the Applicant was harsh, unjust or unreasonable.

Conclusion

[49] Having considered each of the matters specified in s.387, the Commission, as presently constituted, is satisfied the dismissal of the Applicant was:

a) harsh because there was no evidence to suggest the Applicant was guilty of any of the adverse findings made by Ms Shioya, and
b) unreasonable because Ms Shioya made her decision without providing the Applicant with an opportunity to respond.

[50] Accordingly, I find the Applicant’s dismissal was unfair.

[51] In fact, so obvious was the unfairness experienced by the Applicant that (to use the idiom frequently used in Ireland) “even the dogs in the street know” that it occurred.

Remedy

[52] Section 390 of the FW Act sets out the circumstances in which I may make an order for reinstatement or compensation:

“390 When the FWC may order remedy for unfair dismissal

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

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

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

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

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

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

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

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

[53] I have already dealt with the issues at s.390(1)(a)–(b) above. The Commission, as presently constituted, is satisfied the Applicant was protected from unfair dismissal pursuant to s.382 of the FW Act and the Applicant was dismissed unfairly. Accordingly, the Commission is required to determine whether to order the reinstatement of the Applicant or, in circumstances where reinstatement is inappropriate, an order for compensation if it is satisfied such an order is appropriate in all the circumstances.

[54] The Applicant in his original application indicated that he was seeking “compensation, reinstatement or removing the current manager”. Labradoodles has not made any submissions on remedy. However, by the time of the Determinative Conference the Applicant has secured alternative work.

Reinstatement

[55] In Regional Express Holdings Ltd T/A Rex Airlines 30 a Full Bench of Fair Work Australia considered what factors may be taken into account when considering if reinstatement is inappropriate under s.390(3)(a) of the FW Act:

“[26] Whenever an employer dismisses an employee for misconduct, assuming the employer is acting honestly, there is an implied loss of trust and confidence in the employee. If it is subsequently found that the termination was harsh, unjust or unreasonable it is appropriate to consider whether the relationship can be restored if the employee is reinstated. That question cannot be answered solely by reference to the views of management witnesses. All of the circumstances should be taken into account. In this case there are a number of relevant matters. They include the fact that not all of the conduct alleged against the respondent has been proven, the respondent’s apparently unblemished record in the performance of his flying duties over a period of 14 years, the fact that the misconduct is not directly related to the performance of the respondent’s professional duties as a first officer and Rex’s failure to pursue any substantial disciplinary action against another pilot who, it is alleged, has been guilty of misconduct at least as serious as that of which the respondent was accused. The significance of the last consideration is that the pilot in question is still carrying out the full range of his duties, despite allegations of conduct of a kind which, in the respondent’s case, is said to have led to an irrevocable loss of trust and confidence. Assuming a positive approach on both sides we find there is a reasonable chance that the employment relationship can be restored with the necessary level of mutual trust.” 31

[56] Labradoodles is a small employer with a small work environment. If the Applicant was reinstated he would have to work with Ms Shioya. That is untenable. I am satisfied that in the circumstances where it is clear that the relationship between the Applicant and Labradoodles has eroded, reinstatement is inappropriate.

Compensation

[57] Section 390(3)(b) provides the Commission may only issue an order for compensation to the Applicant if it is appropriate in all the circumstances.

[58] Having regard to the issues that gave rise to the finding above that the termination was unfair, the absence of a valid reason and the absence of warnings, Commission, as presently constituted, is satisfied that an order for compensation is appropriate in all the circumstances of this case.

[59] Section 392 of the FW Act sets out the circumstances that must be taken into consideration when determining an amount of compensation, the effect of any findings of misconduct on that compensation amount and the upper limit of compensation that may be ordered:

“392 Remedy—compensation

Compensation

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

Criteria for deciding amounts

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

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

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

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

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

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

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

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

Misconduct reduces amount

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

Shock, distress etc. disregarded

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

Compensation cap

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

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

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

Note: subsection 392(5) indexed to $61,650 from 1 July 2012

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

(a) the total amount of remuneration:

(i) received by the person; or

(ii) to which the person was entitled;

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

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

[60] The method for calculating compensation under s.392 of the FW Act has been considered in a number of decisions, including by a Full Bench of the Commission in Bowden, G v Ottrey Homes Cobram and District Retirement Villages Inc. T/A Ottrey Lodge 32 (Bowden). In that decision the Full Bench set out the order in which the criteria and other factors should be applied, taking into account authority under the Workplace Relations Act 1996 in Sprigg v Paul’s Licensed Festival Supermarket33 and Ellawala v Australian Postal Corporation.34 I have adopted the methodology utilised in Bowden in determining the amount of a payment of compensation.

[61] I will now consider each of the criteria in s.392 of the FW Act.

Remuneration that would have been received: s.392(2)(c)

[62] The payslips in evidence demonstrate that the Applicant was paid monthly. Using those payslips I have determined that the following work pattern in the 28 weeks prior to dismissal:

[63] That means that in the final 28 weeks of his employment the Applicant earned a total amount of $6,921.02 or an average of $247.17 per week.

[64] I should now determine the period of time the Applicant would have remained employed by the Respondent, or would have likely remained employed with the Respondent, had they not been dismissed.

[65] Noting that the Applicant had been employed for 2 years, 4 months and 21 days without complaint, that he enjoyed his job and looked forward to continuing to work with the Respondent while undertaking his studies I find that the Applicant would have continued to be employed by the Respondent for at least 6 months had he not been dismissed. The amount the Applicant would have received is therefore $6,426.42.

Remuneration earned: s.392(2)(e)

[66] The Applicant found alternative work at a higher average hourly rate of pay 6 weeks and 5 days after his employment terminated. In the period since the termination 23 weeks and 4 days have passed. In that period the Applicant has worked 16 weeks and 6 days (at, at least, the same rate of pay). Consequently, I find the Applicant has earned $4,167.28 in remuneration for employment or other work during the period since the dismissal and deduct this amount from the compensation to be ordered.

[67] $6,426.42 minus $4,167.28 leaves a compensation amount of $2,259.14.

Income likely to be earned: s.392(2)(f)

[68] Noting that the Applicant has found alternative work I find the Applicant is reasonably likely to earn $528.94 in income during the period between the making of the order for compensation and the date of actual compensation (being 16 August 2018). I will deduct this amount from the compensation to be ordered.

[69] By deducting a further $528.94 from the compensation amount of $2,259.14, a final compensation amount is calculated at $1,730.20.

Other matters: s.392(2)(g)

[70] I find it is not appropriate in the circumstances that a contingency should be applied.

Viability: s.392(2)(a)

[71] No submissions were made about the viability of the Respondent if I awarded compensation. I note that the final compensation amount of $1,730.20 is less than the cost of one labradoodle puppy.

[72] I find an order for compensation in the amount proposed will not affect the viability of the Respondent’s enterprise.

[If viability of Respondent’s enterprise is affected insert]

Length of service: section (s.392(2)(b))

[73] I find that the Applicant’s period of service with the Respondent, being 2 years, 4 months and 21 days should not affect the amount of compensation to be ordered.

Mitigating efforts: s.392(2)(d)

[74] In considering whether the Applicant has taken steps to mitigate the loss suffered as a result of the dismissal, I should take into account whether the Applicant acted reasonably in the circumstances. 35

[75] I find that the Applicant has made efforts to mitigate his loss suffered as a result of the dismissal. I have deducted those amounts. The Respondent is fortunate that the Applicant is so earnest, diligent and hard-working such that he was an attractive hire to a new employer. Otherwise the compensation amount would have been higher.

Misconduct: s.392(3)

[76] I have not found any misconduct by the Applicant that contributed to the dismissal.

Shock, Distress: s.392(4)

[77] I note that the amount of compensation calculated does not include a component for shock, humiliation or distress.

Compensation cap: s.392(5)

[78] I must reduce the amount of compensation to be ordered if it exceeds the lesser of the total amount of remuneration received by the Applicant, or to which the Applicant was entitled, for any period of employment with the employer during the 26 weeks immediately before the dismissal, or the high income threshold immediately prior to the dismissal.

[79] The amount of compensation I will order does not exceed the compensation cap.

Payment by instalments: s.393

[80] No submissions were made about the need to pay by instalments. I will order the Respondent to pay to the Applicant an amount of $1,730.20 within 28 days.

Conclusion

[81] The Commission, as presently constituted, is satisfied that the Applicant was protected from unfair dismissal, that the dismissal was unfair and a remedy of compensation is appropriate.

[82] An order 36 will be issued with this decision.

COMMISSIONER

Appearances:

Mr L Palpal-Latoc represented himself as the Applicant.

Ms J Katsuda, Katsuda Synergy Lawyers represented Labradoodles

Hearing details:

6 June 2018 in Sydney

Printed by authority of the Commonwealth Government Printer

<PR608422>

 1   Transcript PN287.

 2   Transcript PN242.

 3   Ms Katsuda said Ms Sioya’s daughter had become ill. That might explain why she was not in attendance at the hearing, but it did not explain why no witness statement was filed with her evidence. I directed that Ms Sioya provide the Commission with a medical certificate to establish her daughter’s illness. She did not do so.

 4   In its Form F3 - Employer's response to unfair dismissal application the Respondent claimed the employment only commenced on 9 November 2015. However, this was clearly wrong. This is because there was in evidence from the Respondent pay records dating back to 30 September 2015.

 5   Yaraka Holdings Pty Limited v Giljevic [2006] ACTCA 6 (30 March 2006) at para. 65, [(2006) 149 IR 399]; cited in Ponce v DJT Staff Management Services Pty Ltd T/A Daly’s Traffic [2010] FWA 2078 (Roe C, 15 March 2010) at para. 70.

 6   Exhibit A1.

 7   Exhibit A2.

 8   Exhibit A3.

 9   Exhibit A13.

 10   Exhibit A11.

 11   Exhibit A10.

 12   Exhibit A9.

 13   Exhibit A8.

 14   Exhibit A7.

 15   Exhibit R1

 16   Exhibit R2.

 17   Exhibit R2.

 18   Exhibit R3.

 19   Sayer v Melsteel [2011] FWAFB 7498.

 20   Shepherd v Felt & Textiles of Australia Ltd (1931) 45 CLR 359 at 373, 377-378.

 21   Selvachandran v Peterson Plastics Pty Ltd (1995) 62 IR 371, 373.

 22   Id.

 23   Chubb Security Australia Pty Ltd v Thomas Print S2679 at [41].

 24   Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, 151.

 25   Previsic v Australian Quarantine Inspection Services Print Q3730.

 26   (2000) 98 IR 137.

 27   Ibid at 151.

 28   RMIT v Asher (2010) 194 IR 1, 14-15.

 29   Annetta v Ansett Australia Ltd (2000) 98 IR 233, 237.

 30   [2010] FWAFB 8753.

 31   Ibid at [26].

 32   [2013] FWCFB 431.

 33   (1998) 88 IR 21.

 34   Print S5109.

 35   Biviano v Suji Kim Collection PR915963 at [34].

 36   PR608423.