Fair Work Act 2009
s.394—Unfair dismissal

Joe Lavery
v
Cybermerc Pty Ltd
(U2022/3702)

Application for an unfair dismissal remedy – removal from client site – whether valid reason.

[1] This decision concerns an application made by Mr Joe Lavery pursuant to s.394 of the Fair Work Act 2009 alleging he was unfairly dismissed by Cybermerc Pty Ltd (Cybermerc or Respondent). Mr Lavery seeks reinstatement, continuity of service and lost remuneration arising from his dismissal.

[2] Cybermerc is a cyber security business based in the ACT which provides cyber security, threat intelligence, ICT consulting and management services to its clients in both the private and public sectors.

[3] Mr Lavery was employed by the Respondent in the role of Director of Education and Research under the terms of an employment contract dated 19 October 2019.

[4] By letter of 9 March 2022 Cybermerc informed Mr Lavery that his employment was terminated and provided him with two weeks’ pay in lieu of notice. His dismissal followed his removal from a project contracted with the Australia Defence Force (Defence) of which he was designated as ‘Program Director’. The letter of termination was expressed as follows:

“Dear Joe

Termination of your employment with Cybermerc

I refer to the letter from your lawyers, dated 1 March 2022, that we received in response to our show cause letter and previous correspondence in relation to your employment with Cybermerc.

Your lawyers’ letter ignores the reality of the situation in relation to your employment in a number of aspects.

Firstly, it is patently incorrect to claim that you have not been provided with particulars in relation to concerns that have arisen in relation to your conduct and performance. We have provided you with all the details that have been provided to us by Defence. To demand to be provided with material that does not exist is foolish stubbornness.

As we advised you in our show cause letter, you have been provided with more than enough information in relation to the conduct and performance concerns being raised in order to be able to provide a response.

Secondly, your lawyers' letter fails to acknowledge or properly address the crucially important fact that Defence has directed us to remove you from the ADFCGP Project. Defence has also indicated that it will not permit us to have you involved in further work for Defence.

It is this second issue, that leaves us with little choice but to consider the termination of your employment, given that we are currently unable to identify another client with which we can place you.

Without such a placement, the continuation of your employment is not financially viable for our business. Accordingly, we asked if you could identify an alternative role. The response in your lawyers’ letter to simply allow you to return to work to ‘develop new projects for Cybermerc’ is not financially realistic or viable.

We have considered the contents of the letter from your lawyers in response to our show cause letter. However, it does not contain anything that identifies a financially practical way that we can redeploy you and continue your employment. Consequently, we unfortunately advise that the decision has now been made to terminate your employment with Cybermerc. Accordingly, please regard this letter as notice of termination of your employment. Pursuant to your contract of employment and the National Employment Standards, you are entitled to two weeks’ notice of termination. However, as we are unable to identify any appropriate alternative position for you, we have also decided to pay you two weeks’ pay in lieu of notice. As a result, your employment will end today.

In addition to receiving a payment in lieu of notice, you will also be paid all accrued and undertaken annual leave.

Your lawyers’ letter seeks confirmation of the issuance of X class shares. We advise that we will be processing and providing you with this as soon as reasonably practicable.

Your lawyers’ letter also seeks payment of commissions. We advise that we will be processing and paying this entitlement in the usual way and that the amount is expected to be significantly less than the amount sought in your lawyers’ letter.

Finally, your lawyers’ letter seeks that we provide your pay records by 8 March 2022. The Fair Work Regulations 2009 (r3.42) provide us with 14 days from the date of the request in which to provide such records. Naturally, we will comply with the timeline requirements of the regulations in relation to providing you with pay records. Accordingly, the litigation threatened by in your lawyers’ letter is premature.

Notwithstanding the above and the sentiment conveyed in your lawyers’ letter, we would like to part ways amicably and wish you all the best for the future. In this regard we hope that you genuinely understand that our hand has been forced by Defence in relation to your employment and that the reasons alleged in you lawyers’ letter had nothing to do with the termination.

If you have any questions please contact me.”

[5] In opposing the application, Cybermerc claimed that the dismissal was not unfair on the basis that:

a. Mr Lavery was assigned to work (almost exclusively) on a project with Defence from October 2021.

b. Defence directed Cybermerc that Mr Lavery be removed from the project.

c. Neither Mr Lavery nor Cybermerc could identify any other available role or client with which he could be reasonably placed.

[6] The hearing of the application was conducted by video on 10 August 2022. Mr Lavery was self-represented and Mr W Ward of Mills Oakley appeared for the Respondent. Closing written submissions were received from Mr Lavery on 24 August 2022 and from the Respondent on 31 August 2022, with a reply from Mr Lavery on 7 September 2022.

[7] For the reasons set out below, I find that Mr Lavery’s dismissal was not unfair.

Factual background to the dismissal

The Cyber Gap Program

[8] In October 2021 Cybermerc entered into a contract with Defence for the delivery of cyber security training. The project, known as Australian Defence Group Cyber Gap Program (Cyber Gap Program or ADFCGP), was the subject of a contract issued on 19 October 2021 which was worth $1,264,000 over its two-year term. Mr Lavery was identified in the contract as ‘Program Director’. Alongside him were two other employees of Cybermerc, Mr Tony Knox and Mr Remy Coll who were nominated as ‘Project Manager’ and ‘Solution Architect’ respectively.

[9] It is uncontroversial that the Cyber Gap Program is a major project for Cybermerc and as the key person responsible Mr Lavery was required to devote significant time to the program.

[10] On 17 February 2022, Captain Paul Scott RAN sent an email to Mr Nevin, Chief Executive Officer of Cybermerc, stating that concerns were raised with him by the Defence Cyber Gap team about ‘patterns of unprofessional behaviour from Mr Joe Lavery’. Captain Scott indicated that he had conducted ‘further investigation’ and had raised the concerns with his supervisor, Brigadier Watson. Mr Nevin was asked to attend a meeting the following day to discuss the issue.

[11] At that meeting on 18 February 2022 between Cybermerc and Defence there were discussions in relation to the purported inappropriate behaviour of Mr Lavery as well as quality and performance issues in service delivery of the Cyber Gap Program. Attending the meeting were Captain Scott, Brigadier Watson, Mr Nevin and Ms Linda Cavanagh (Cybermerc COO).

[12] On Saturday 19 February 2022 Mr Nevin sent an email to Mr Lavery informing him that he was being stood down with pay as a result of a number of allegations made against him by Defence relating to his ‘unprofessional/inappropriate conduct’ and a number of concerns regarding the delivery of the contract requirements. Mr Lavery was told to remain away from the office and not contact the clients and fellow employees. Mr Nevin indicated that he had drafted a letter with the allegations and would be able to provide it to Mr Lavery on the following Monday for his review and response.

[13] On Monday 21 February 2022, Mr Lavery received a letter via email from Mr Nevin. The letter set out allegations that were said to have been made by the Defence. Out of the 15 allegations, six were described as regarding Mr Lavery’s unacceptable behaviour and eight were described as regarding contract management, product delivery and quality. The letter went on to state the following:

“In addition to the issues raised by Defence, I have recently become aware of you having utilised the team for an unsanctioned project named AMBER TIN. It appears that you directed team resources to AMBER TIN, at the apparent expense of meeting deliverables for the ADFCGP as above.

You have also failed to properly advise either myself or the Chief Operating Officer of the many issues with the ADFCGP project, culminating in significant contractual, financial, reputational and business risk to Cybermerc.”

[14] Mr Lavery was required to respond to the allegations by COB Tuesday 22 February.

[15] On 22 February 2022, Mr Nevin advised Mr Lavery that his request for an additional week to respond was refused. Rather, he was given an extension of 24 hours to respond.

[16] On 23 February 2022, Mr Lavery provided his response to the allegations in the following terms:

“Dear Matthew

I refer to your email on 19 February 2022 and letter dated 20 February 2022 and the allegations contained therein.

Pursuant to your request, I have set out my responses to some 15 allegations as best I can given the extremely short timeframe and lack of proper particulars with many of the allegations.

For some of the allegations I am unable to provide my response to you because you have not provided proper particulars of the allegations against me. Please provide me with these particulars as matter of priority so that I can properly respond to the allegations against me.

Response to allegations regarding unacceptable behaviour

1. Defence alleges that all 5 female members of the ADFCGP team made a formal complaint to Defence concerning Joe Lavery’s conduct.

I am unable to respond to this allegation as it provides no particulars as to my conduct, nor have you provided any details about the alleged ‘formal complaint’.

Please provide these to me so that I can actually respond.

2. In a formal email providing the Cyber Gap Program team with a contracted deliverable, Defence alleges that Mr Lavery started his email with “G’day ladies, Happy Valentine’s Day”. Defence stipulates that the ADF personnel found it extremely inappropriate. The reported observation provided to Defence management was “I do not think Joe would open an email like this to a male military contract manager, which highlights a lack of professional respect he has for our Gap Team members that he is working with”.

While this email did not contain a contracted deliverable, I acknowledge starting my email to the Cyber Gap Program team cc’ing in Cybermerc’s COO and Training Manager (male and female) with “G’day ladies, Happy Valentine’s Day”. I wrote this solely in an attempt to build rapport with our customer and in no way wished to offend anyone or otherwise act in an unprofessional manner. I believed at the time that my actions were consistent with the collegiate approach discussed at the Directors meeting.

I would be grateful for the opportunity to apologise to anyone I have offended and will draft all correspondence in a more formal manner in future.

3. Defence alleges that in a private message conversation with SQNLDR Kylie Breheny, Mr Lavery is alleged to have said that Cybermerc “will have to pass” on providing slides for the Induction. Defence considers this highly inappropriate as the Induction is a key milestone outline in Cybermerc’s agreed Project Plan (and the Work Order/Contract), and is also considered extremely unprofessional. Cybermerc were advised of this requirement on 11 Feb at the latest, with initial discussions in regards to the Induction occurring with them on 17 Jan 2022

This message needs to be considered in context and it was sent in response to a request for additional slides that were requested outside the scope of Simple Work Order 15482 and it was not critical to the project. Without being exhaustive:

•  At the time I was attending the mandatory Cybermerc Cultural Workshop. During the Cybermerc Cultural Workshop in a short break, I was trying to communicate with Defence via telephone. I returned to the workshop several minutes after everyone else. You pulled me aside at approximately 1104h and told me the cultural workshop was very important and that I was not to answer my phone.

•  When I asked you “What about the Defence deliverables, can I respond to them?” You replied with words to effect of “I don’t care about Defence, I care about this training. I put this training on for you. When you touch your phone, it fills me with rage”.

•  I was shocked by the word ‘rage’ and felt bullied, threatened and intimidated.

•  I was singled out because I was ordered to remain in the cultural workshop, despite others being able to excuse themselves for short periods to deal with client work and other matters.

•  My attendance at the Cybermerc Cultural Workshop on Tuesday, Wednesday and Thursday adversely impacted my ability to complete the extra slides requested by Defence.

•  Despite all this, I still managed to deliver a dozen slides to satisfy the extra Defence work before the concocted deadline for work that was over and above the Simple Work Order 15482. I note the Defence feedback on this extra work stated ‘Thank you for providing your presentation slides, they look fantastic.’ This feedback does not align with the accusations of my conduct being highly inappropriate and/or extremely unprofessional.

4. Defence alleges that Mr Lavery demonstrated a lack of understanding in relation to acceptable behaviours and conduct. In the Participant Welcome Pack that was drafted by Joe, the following was on Page 21 “Please be prepared to click the download button and then head to the fridge or pantry to grab your beverage of choice”. Any references to alcohol/beverages while undertaking official business are not aligned with Defence’s values and behaviours.

Again, this allegation has clearly been taken out of context. The entire paragraph was:

“Due to the breadth of topic matter, it is unlikely you will achieve excellence across every module – don’t be disheartened, seek assistance to enhance your strengths and consolidate your weaknesses. The (LMS) system will advise when a large download is required. Please be prepared to click the download button and then head to the fridge or pantry to grab a beverage of choice.”

The paragraph is clearly intended to simply prompt the participant to go get a drink or a snack whilst the participant waits for their relevant module to download. It was not intended to be read as a reference to an alcoholic beverage nor an encouragement for the participant to consume alcohol whilst undertaking the learning module.

I do not believe that my actions constitute unacceptable behaviours and conduct or anything to the level warranting suspension. Nonetheless I have taken on the feedback and consider this a lesson learned.

5. Defence alleges that in their most recent meeting with Cybermerc on 15 Feb 22, Mr Lavery provided significant pushback on Kylie Breheny when she asked for a timeframe for platform technical support/moderation support as part of Deliverable 3. Mr Lavery was not receptive to why specific timeframes were required. Defence alleges that this instance followed a pattern of Mr Lavery repeatedly behaving in an unprofessional and unacceptable manner.

This is not an accurate version of events.

On 11 Feb, Defence emailed saying ‘there seems to be some confusion between the feedback provided on this document and that provided on the participant version of the document’. I forwarded this email to the COO, CTO and Training Manager given my concerns with Defence’s comments highlighting where I believed there was some confusion.

I was very concerned that the requests were outside of scope and therefore sought feedback from the COO, CTO and the Training Manager. I also sought guidance and support from the COO in my response to Defence on 11 February 2022 and the COO settled my email.

6. Defence alleges that in his interactions with the ADF Cyber Gap Team, Mr Lavery has repeatedly and consistently demonstrated disrespect and unwelcome communication which Defence considers unacceptable behaviour (Defence Definition: unreasonable conduct at work or in any situation that may be connected to Defence that is offensive, belittling, abusive or threatening to another person or adverse to morale, discipline or workplace cohesion).

I am unable to respond to this allegation as it provides no particulars as to my conduct. Please provide details of the interactions which form the basis of this allegation so that I may respond.

Allegations regarding contract management, product delivery and quality

1. Defence alleges that only one document deliverable (Communications Plan) has been delivered on time. This is also the only one that required one feedback cycle and the only document not written by Mr Lavery.

This is not an accurate version of events.

For example, the COO fell ill due to COVID which resulted in me drafting the initial ADFCGP Cybermerc Communications Plan. Although the ADFCGP Communications Plan was to be authored by the COO, she unfortunately fell sick. Accordingly, I drafted this document deliverable outside of business hours, on top of my normal ordinary duties because that is what the team needed and to ensure the COO was not overburdened on return from illness.

There were Defence stand downs over Christmas. I also contracted COVID after Christmas and was still expected to work without any additional resources or time extensions to the deliverables.

All of these delays were regrettable but outside of my control and were also a result of a broader team resourcing issue rather than as a result of any undue delay or failures on my part.

2. Defence alleges that there have been multiple instances of feedback on document deliverables not being applied, or being directly copied across multiple documents without consideration for relevancy for the intended audience (e.g. personal contact details of staff provided for alerts in the case of system outage were included in the Participant Welcome Guide twice).

I do not agree with this allegation. Feedback from Defence has been very inconsistent, lacking in clarity and impossible to decipher at times (despite me seeking clarification or feedback). Depending on the specific instances you are referring to, I can provide further details of these issues which were never of my making.

If you could please provide specific details of these instances including dates so I can properly respond to this allegation that would be appreciated.

3. Defence alleges that the first draft of the document deliverable ‘Moderation & Behaviour Management Plan’ – which is intended for staff and mentors – was written for participants.

This is incorrect.

The first draft of the Moderation & Behaviour a Management Plan included Auth0 and LMS setup because this is all performed from the Welcome Email. Some Defence feedback suggested that Slack™ was not a workable deliverable citing to an operating system almost 10 years old that is no longer supported.

Seeking to separate Slack™ and LMS user guides is a new requirement that emerged for the first time on 18 February. This is further evidence of repeated Defence behaviour changing their requirements and demanding additional work above and beyond the Simple Work Order 15482.

4. Defence alleges that the content of the Document Deliverables was not understood across various documents – Skeleton Project Plan guidance on project schedule activities was provided by ADFCGP (SQNLDR Breheny), TOC for Participant Welcome Guide was also provided by ADFCGP.

This allegation is vague and lacking proper particulars.

Please provide actual details of which document deliverables were allegedly not understood for each document so that I may respond to this allegation.

5. Defence alleges that Learning Module material was first seen during User Acceptance Testing (UAT) with a significant (excessive) number of spelling and grammatical errors, technical inaccuracies and status completion errors.

Can you please provide further details of the specific spelling and grammatical errors, technical inaccuracies and status completion errors so I can properly respond to this allegation.

6. Defence alleges that one lab in the learning material directed Testers to a free UK based training site, requiring testers to register.

Please provide actual details so that I may respond properly to this allegation.

7. Defence Testers expressed concern on the use of video content from Zulu, citing cultural/social issues and the likely inability for a younger audience to relate. Defence alleges that this was raised with Mr Lavery who commented that someone would always take offence at something and it would just go to text based content.

The inclusion of the video content achieved the learnings required, I was happy to use a text based resource as well.

The movie Zulu is about the Battle of Rorke’s Drift that took place in 1879 and how 150 British soldiers were able to survive by defending themselves against around 4,000 Zulu’s by applying the Principles of Defence.

There were more Victoria Crosses awarded at the Battle of Rorke’s Drift than any other military engagement, including two world wars.

This video was selected because of its strong demonstration of how to apply defensive principles and showed one of the most significant military battles in commonwealth history – which accorded to the strategic objectives of the ADF Cyber Gap Program.

8. Defence alleges that Mr Lavery has consistently failed to submit status reports by COB each Monday, despite repeated reminders and demands to do so.

These status reports were not a contracted deliverable. The reports were provided to Defence in an attempt to build rapport with our customer. Although my access to the Cybermerc system has been cut off disallowing me to recall dates and time of reports, any issues or delays in these status reports were usually due to circumstances largely outside of my control for example the Christmas break or me contracting COVID.

Allegations relating to AMBER TIN

I have recently become aware of you having utilised the team for an unsanctioned project names AMBER TIN. It appears that you directed team resources to AMBER TIN at the apparent expense of meeting deliverables for the ADFCGP.

My work on the AMBER TIN project was conducted in consultation with the CTO who was equally unaware of the alleged risks you later alluded to without specifying. You directed we would discuss the matter at some point in the future after I had followed all of your direction. That discussion has not yet occurred.

In any case, none of this detracted from meeting the deliverables for ADFCGP.

Allegations relating to failure to advise you or the COO re: ADFCGP

This allegation is misconceived and has no factual basis. As above, the COO and I have worked collegiately and professionally to protect Cybermerc by addressing the multiple matters and inconsistent changes demanded by Defence. The COO, CTO and Training Manager have been copied into all relevant emails.

Next Steps

I await proper particulars of the allegations against me where required above so that I may respond to them as soon as possible. If these particulars are not provided, I can only assume that this matter has a predetermined outcome, which is a serious concern.

I note that making any decision in relation to my employment without providing me with a fair and reasonable opportunity to respond to these allegations would not afford me procedural fairness and would result in a harsh, unjust and unreasonable outcome.

I have much to contribute to Cybermerc and the ADFCGP project and believe that the above issues could be resolved. I believe I am able to mend any damage in my relationship with the relevant Defence personnel if given the opportunity.

I remain ready, willing, and able to return to the workplace immediately and look forward to hearing from you with respect to my suspension being lifted soonest.

This matter has foisted a significant amount of stress on me personally and my family. If you refuse to allow me to return to work, I would be content to explore an amicable and confidential separation on reasonable terms.

I otherwise expressly reserve all my legal rights, including with respect to my outstanding entitlements including commission payments and issue of X class shares which I have previously raised with you.

Sincerely

Joe”

[17] On 25 February 2022, two days after Mr Lavery sent his response, he received a letter from Mr Nevin requiring him to provide reasons by 1 March as to why his employment should not be terminated (Show Cause letter). That letter reads:

“Dear Joe,

Your Employment with Cybermerc – Show Cause Notice

I refer to your email of 23 February 2022.

Provision of Particulars

Cybermerc has provided you with all relevant information it has received and is in its possession in relation to the allegations in respect of your unsatisfactory conduct and performance.

Indeed, the allegations put to you are in the same terms as they have been provided to us by Defence (and therefore contain all relevant information provided to us about their concerns in relation to your placement with Defence) and you therefore have had all relevant information before you when preparing your response.

Therefore, there are no further particulars.

In this regard we would like to remind you that we have provided you with more than sufficient detail in respect of the performance concerns that have arisen in relation to your performance.

In other words, you cannot genuinely claim that you have not been given enough information to know or understand the performance issues raised in our letter for the purposes of providing a response.

Your response to the allegations

I have reviewed your response to the allegations.

While we acknowledge that you have expressed a level of contrition in relation to your behaviour, it remains the case that you have demonstrated a consistent failure to project manage the ADFCGP and further, a consistent pattern of unprofessional conduct by you in relation to your work on that project expected of a person undertaking your position.

Defence has directed us that you cannot return

As I stated in our previous letter to you, Defence has directed Cybermerc to remove you from the ADFCGP Project. Further, Defence has directed us that it will not permit us to have you involved in any future work for Defence.

Therefore, despite your contrition, it remains the case that Defence has definitively determined and directed us that it will not accept you back.

You will understand that Cybermerc’s relationship with Defence is critically important to the success of our business and we have no option in this regard. Furthermore, we have had to find replacement resources to undertake the work you were assigned at Defence.

With the above in mind, we have therefore given consideration to whether we can redeploy you to another suitable client of our business. Unfortunately, we have not been able to identify any suitable alternative positions, however we are willing to take on board any feedback or suggestions you may have in relation to potential redeployment options.

Given all the above, I have formed a preliminary view that the refusal by Defence to have you return to working for it constitutes a valid reason to terminate your employment. Specifically, the situation as it stands is that you no longer have the ability to perform your role because Defence will no longer permit you to perform your job there and furthermore, we are bound, with Defence being our client, to follow their directions. However, I have not yet made a final decision in this regard.

Before I do so, I would like to invite you to provide a written response to this letter as to why your employment should not be terminated. I will give prompt consideration to all matters raised by you before I make any final decision.

I require your response by COB Tuesday, 1 March 2022.

If you decline to provide a response to this letter by that time, I will make a decision based on the material available to me at that time.

If you have any questions please contact me.

Yours sincerely,

Matthew Nevin

Chief Executive Officer

Cybermerc Pty Ltd”

[18] On 1 March 2022, KHQ Lawyers wrote to Cybermerc on behalf of Mr Lavery. That letter reads:

“Dear Mr Nevin

Joe Lavery and Cybermerc Pty Ltd

We act for Joe Lavery with respect to his employment at Cybermerc Pty Ltd (Cybermerc) and refer to your letters to Mr Lavery dated 21 February 2022 and 25 February 2022.

Please direct all future correspondence to our office.

It is abundantly clear from your correspondence that Cybermerc is engaging in a sham process with a predetermined outcome to terminate Mr Lavery’s employment. That you are not willing or able to provide any proper and basic particulars for the purported allegations against Mr Lavery upon which you rely only emphasises the predetermined nature of the show cause process.

The fact that you have placed our client on suspension during this sham process makes your conduct even more egregious.

Proceeding to terminate Mr Lavery without having received particulars of the allegations against him is highly prejudicial toward Mr Lavery. If Cybermerc proceeds to terminates Mr Lavery employment without having followed due process in the above circumstances, without having any evidence of the allegations against him, with only a superficial consideration of Mr Lavery’s responses or without consideration of whether there is a valid reason for Mr Lavery’s termination, Mr Lavery will have a strong basis to bring an unfair dismissal application against Cybermerc.

Furthermore, your letter to Mr Lavery dated 25 February 2022 highlights that Cybermerc is not willing to make any efforts towards seeking to understand Mr Lavery’s version of events and addressing any issues in Cybermerc’s relationship with the relevant elements of Defence, nor explore any avenue for Mr Lavery to work with other elements of Defence on other existing and future projects. Your also letter ignores the Cybermerc’s failure to adequately resource the ADF Cyber Gap Program project and your own responsibility toward the project.

Any foreshadowed termination on the purported basis of there being no alternative work is entirely misconceived and fails to appreciate the depth of work available across the broader Defence organisation and Mr Lavery’s demonstrated ability to assist with other non-Defence clientele.

We are also instructed that Mr Lavery’s efforts have been instrumental to the growth of Cybermerc, with Mr Lavery’s “hustle” being praised by yourself on numerous occasions which even resulted in the promise of a leather jacket as a performance reward – which you have failed to provide.

Additionally, as a result of the Mr Lavery’s contribution to Cyberbmerc, a significant number of contracts have been won which has contractually entitled Mr Lavery to commission payments and the grant of X class shares pursuant to clauses 5 and Item 2 of the Schedule to Mr Lavery’s employment agreement dated 31 July 2020. We note that Mr Lavery requested on multiple occasions to receive commissions owing to him including on 19 September 2021 and the reminder email sent to you 20 October 2021. Those commission payments as outlined at Annexure 1 are yet to be paid.

In circumstances where Cybermerc has engaged in a course of conduct to remove Mr Lavery from Cybermerc without paying him his contractual entitlements to which he has complained of on numerous occasions, Mr Lavery also has strong grounds to file an adverse action claim against Cybermerc and yourself individually as an accessory to Cybermerc’s contraventions, in addition to pursuing his unpaid contractual entitlements.

Next Steps

Having regard to the above, we therefore demand:

•  that Mr Lavery’s suspension be lifted immediately so that Mr Lavery can return to the workplace and continue to work and develop new projects for Cybermerc;

•  that Mr Lavery’s commission payments totalling $95,010 as set out in the table below be paid into Mr Lavery’s normal bank account by no later than 4pm on 8 March 2022 with supporting pay information; and

•  that Cybermerc provide evidence that Mr Lavery has been issued his entitlement of the X class shares and provide a copy of the share register reflecting same by 4pm on 8 March 2022 as requested previously.

Employee Records

Pursuant to regulation 3.33 of the Fair Work Regulations 2009, we request a copy of all pay records relating to Mr Lavery’s employment. Please ensure that these records are provided by return email by 4pm on 8 March 2022.

Mr Lavery reserves expressly reserves all of his legal rights. Please contact the writer with any queries.

Yours faithfully

KHQ Lawyers

[19] Mr Lavery was next notified of his dismissal on 9 March 2022 by a letter the terms of which have been set out earlier in this decision.

The case for Mr Lavery

Mr Lavery

[20] Evidence was given in support of Mr Lavery’s application by himself and by Brigadier Watson, Mr Nathan Herbert and Mr Remy Coll. Brigadier Watson and Mr Herbert were not required for cross examination.

[21] Mr Lavery joined Cybermerc in October 2020. He stated that the duties of his role were primarily to ‘build the training business’, which required him to “find and win training contracts by designing, building, and delivering cyber and intelligence training courses”. His remuneration was comprised of both salary and commissions.

[22] Mr Lavery gave evidence that since employed by Cybermerc he had won a number of contracts for its business with an estimated total value of $2.715m, including the Cyber Gap Program. Specifically, he had secured $715k of work within the first three months of commencing employment with Cybermerc. He said that when he first joined Cybermerc the training team only has two persons including him. As a result of the contracts he brought in, the team was expanded to four by November 2021.

[23] Mr Lavery gave evidence in relation to the scope of his role and stated that his duties were not limited to the Cyber Gap Program. He said that his role “included a multitude of clients, it involved business development, service design and delivery and hiring recommendations to build and sustain a training team capability”. The business development activities he conducted required significant time, energy and occasional financial resourcing. The tasks included responding to Request for Tenders, ongoing engagement with clients and liaison with potential new clients and multiple interstate trips to seminars and presentations.

[24] Mr Lavery submitted that Cybermerc’s process in dismissing him was flawed and his evidence included the following:

a. Mr Nevin did not seek any clarification from the Defence nor a response from him and did not provide him with any details of the allegations prior to making his decision to remove him from the workplace. In doing so, it demonstrates that he did not attempt to form an independent view about the allegations and failed in his duty of care to safeguard his employee.

b. Mr Nevin stated in his email of 21 February that ‘email would be the best channel to reach out’. This signified no further verbal communications were welcomed by Cybermerc and was ‘undignified and unnecessarily callous’.

c. The last verbal communications he had with Mr Nevin was when he telephoned him on 18 February telling that he was being stood down.

d. Most of the allegations contained in the letter of 21 February “lacked particulars, were factually incorrect, did not make logical sense or were taken out of context.”

e. He was never provided with any evidence of his alleged misconduct and Mr Nevin adopted the accusations presented by Defence as unarguable facts.

f. He was given one business day to respond to the letter of allegations. “When I requested a reasonable and short extension, I was granted only 24 hours. By demanding a substantive reply to a serious matter within such a short period of time, Mr Matthew Nevin did not provide natural justice. There was no reasonable opportunity for me to seek appropriate legal advice, let alone compare legal advice to make an informed decision.”

g. Mr Nevin informed Defence that he had been stood down ‘in order to conduct and inquiry’ but no such inquiry was ever conducted. Mr Nevin demonstrated a complete lack of interest in his response.

h. Cybermerc’s claim in the show cause letter that Defence would not permit him to be involved in any future work for Defence was untrue. Captain Scott ‘requested’ his separation from the Cyber Gap Program but there was no ‘direction’ nor ‘demand’. There was no withdrawal of permission for future Defence work. “A request of separation from one, single project does not equate to the Cybermerc inferred Defence-wide ban creating a lack of capacity.”

i. The phrase “in relation to your placement with Defence” in the show cause letter was used to fabricate an excuse for his dismissal.

j. Cybermerc placed the onus on him to identify suitable alternative positions. In this regard he said: “an employer is obliged under the Fair Work Act to make a thorough, assiduous and genuine search for suitable redeployment opportunities, taking into account the interests of the employee. There is absolutely no evidence provided by Cybermerc that this was ever genuinely attempted.”

k. Nonetheless, redeployment was never required. His primary job responsibility was to ‘build the training business’ and it went beyond a single client.

l. The fact that the Show Cause letter instructed him to reply within two business days demonstrates that it had a predetermined outcome, and it would not matter how he responded.

m. The statement in the termination letter that it is not financially realistic or viable to allow him to return is ‘farcial’. He said: “it is incontrovertible that I won Cybermerc millions of dollars – a sum of money that would have covered my reasonable employment cost for around 15 years.”

n. Following his dismissal Cybermerc advertised for full time employees in April 2022 and hired a new General Manager in May, according to LinkedIn. He said: “the hire of a General Manager underscores the fact that no serious attempt was made by Cybermerc to redeploy me” and renders its claim of lacking financial viability deceitful.

[25] Mr Lavery said that any suggestion that he was only working for a single client on a single project was untrue. He said that his role “included a multitude of clients, it involved business development, service design and delivery and hiring recommendations to build and sustain a training team capability”.

[26] Mr Lavery said that on or about 27 January 2021 he provided a progress update to Captain Scott via an online video conference. There were no issues or concerns about the program or his behaviour raised and at the end of this meeting Captain Scott said words to him to the effect of ‘Excellent brief, good work, thank you’.

[27] Mr Lavery also tendered an email from Major General Susan Coyle which said:

“Thank you for your email and the attached letter requesting a copy of the relevant Fact Find, Quick Assessment or Inquiry into allegations about your conduct. I have reviewed this matter and can advise you that Defence did not, nor was obliged to conduct an investigation into this matter. The onus was on the contracted provider to rectify the situation after the complaint was raised”.

Brigadier Watson

[28] Brigadier Watson is responsible for the Cyber Gap Program.

[29] He was not cross examined.

[30] Brigadier Watson gave evidence that he did not direct Cybermerc to remove Mr Lavery from all future work for Defence, nor did he place restrictions on Cybermerc’s ability to use Mr Lavery in other projects with Defence.

[31] Brigadier Watson said he did not direct Cybermerc to remove Mr Lavery from the Cyber Gap Program, however he was aware that in a meeting with Cybermerc on 18 February the responsible Director (who reports to Brigadier Watson) “requested separation of Mr Lavery and the ADF Cyber Gap Program to resolve an unacceptable behaviour complaint lodged by members of the ADF Cyber Gap Program team”.

[32] He stated there were no current restrictions imposed by his Branch of Defence for Mr Lavery to work through Cybermerc or any other employer with Joint Information Warfare Branch.

[33] A letter dated 21 February 2022 signed by Brigadier Watson was attached to the statement of Mr Nevin and tendered into evidence. In the letter subjected ‘Notice of requirement to remedy performance shortcomings – ADF Cyber Gap Program’, Brigadier Watson made reference to the meeting on 18 February during which two concerns were discussed, being a report of unacceptable behaviour raised by member of the program and the disappointing quality of deliverables to date. In terms of both concerns, the letter set out the expectations of the Department going forward. The letter did not request the removal of Mr Lavery from the Cyber Gap Program.

Mr Nathan Herbert

[34] Mr Herbert is a former employee of Cybermerc. His evidence was not directly relevant to the matters the Commission needs to decide.

Mr Remy Coll

[35] Mr Coll is also a former employee of Cybermerc. He gave evidence as to how he viewed Mr Lavery’s role and his work on the Cyber Gap Program.

Submissions

[36] Mr Lavery contended that there was no valid reason for his dismissal and his dismissal was unfair because:

a. He was not dismissed for any conduct reasons.

b. The letter of allegations also instructed him to reply within one business day. When he requested a reasonable and short extension, he was granted only 24 hours. By demanding a substantive reply to a serious matter within such a short period of time, he was not provided natural justice. There was no reasonable opportunity for him to seek appropriate legal advice.

c. Mr Nevin informed Defence that he was stood down in order to conduct an inquiry but the inquiry was never carried out. This is a failure to provide procedural fairness.

d. Absent a genuine inquiry, Mr Nevin was unable to formulate an independent assessment of the facts nor the full circumstances surrounding the accusations.

e. Mr Nevin demonstrated a lack of interests in considering his response.

f. The accusations lacked particulars, were factually incorrect, did not make logical sense or were taken out of context.

g. The key tenet of the Show Cause letter of 25 February was an inability to redeploy him due to apparent redundancy. The phrase ‘in relation to your placement with Defence’ was a language used to fabricate an excuse for termination. He was never ‘placed’ with Defence. He was responsible for many clients and Defence was only one of them.

h. Although Captain Scott requested his separation from the ADF Cyber Gap Program, there was no direction nor demand. There was no withdrawal of permission for future Defence work. In fact, no restrictions were imposed by Defence whatsoever. This claim by Cybermerc is an exaggerated falsehood.

i. He never lacked capacity to perform his substantive role as the Director of Training, and his substantive role and responsibilities as Director of Training was never altered.

j. The removal of him from the Cyber Gap Project could not have led to a lack of capacity to perform his role as Director of Training as the role was never contingent on being engaged to only work on the Cyber Gap Project or only with Defence. He continued to work for other clients whilst working on the Project.

k. Notwithstanding the significant time he spent working on the Project around the time of his dismissal, he had broader responsibilities beyond the Project. He was employed to perform work for a number of clients and continued to develop new business which was a key part of his role as it was the basis for his commission entitlements.

l. He was never a labour hire employee.

m. His role was not redundant thus there was no need to redeploy him.

n. He was removed from the Project pending an investigation but the investigation was never completed.

o. He was employed as the Director of Training in name and in substance at all relevant times rather than the Director of the Cyber Gap Project.

p. At no time was his employment contract change to assign him to work on the Cyber Gap Project only.

q. He did not and would not have agreed to change from a secure permanent full time Director of Training Role for which he would be able to receive commissions from projects and clients to a single project with a single client.

[37] Mr Lavery relied on the Full Bench decision in Tasmanian Ports Corporation Pty Ltd t/as Tasports v Gee 1 to contend there was no valid reason for his dismissal simply because of his removal from site. Further, Cybermerc were required to form an independent conclusion as to the employees conduct and conduct a genuine review of alternative work opportunities. Also, an employer who dismisses an employee cannot rely exclusively on the actions of a third party as their defence to a claim of unfair dismissal. His role, he said, had a broad range of responsibilities beyond just the Cyber Gap Program.

[38] Mr Lavery submitted that even if there was a valid reason for his dismissal following his removal from the Cyber Gap Project, there was substantial procedural unfairness. He said the email from General Coyle showed there was no investigation undertaken by Defence, and so to the extent there was any investigation it comprised nothing more than passing Defence’s allegations to Mr Lavery and requesting a response. Further, without a genuine investigation by Cybermerc, it would be impossible for Cybermerc to have formed their own independent view.

[39] Mr Lavery also submitted that his employment contract did not give Cybermerc the ability to fundamentally and unilaterally change his role to that of a labour hire employee assigned to work on a single project for a single client, nor did this change happen in practice as he continued to work on other projects for other clients during his time on the Cyber Gap Program.

[40] Mr Lavery highlighted that Captain Scott was not called to give evidence and submitted “the Commission should make an adverse inference against the Respondent that Captain Scott would have given evidence in cross examination that would not have assisted their case”.

[41] Mr Lavery sought reinstatement as a remedy and contended that compensation was an inadequate remedy given the reputational loss he has suffered.

The case for Cybermerc

[42] Evidence for Cybermerc was given by Mr Matthew Nevin, Ms Linda Cavanagh and Mr Andrew Muller.

Mr Nevin

[43] Mr Nevin explained that he had co-founded Cybermerc with his brother in 2016 and considered Cybermerc’s reputation to be the most important asset of the company. He said their client relationships require all staff to comport themselves with a level of integrity and professionalism that must remain above reproach.

[44] Mr Nevin said he employed Mr Lavery in October 2020 in the position of Director of Education and Research but as the role evolved, he became Director of Training. In October 2021 Cybermerc won the contract for the Cyber Gap Program. In his evidence he explained some of the key terms of the contract. This included the ability for Defence to terminate the contract or suspend Cybermerc at any time if it considers Cybermerc is not providing the services or products in accordance with the contract.

[45] He said that he was acting in accordance with the terms of the contract by following written email instructions from Captain Scott to stand down Mr Lavery and remove him from the Cyber Gap Program.

[46] Mr Nevin said that at the time the contract for the Cyber Gap Program was executed, Mr Lavery had worked across a number of contracts, however those other contracts were largely competed by this time. The other contracts only required a very small amount of work which was handled by more junior staff members. Accordingly, he determined that Mr Lavery was the most appropriate employee to manage the Cyber Gap Program as it required an employee to be totally dedicated to the project and he had the capacity to do so. Once he was assigned to the Cyber Gap Program, his position became one where he was solely dedicated to working for defence in order to deliver the Cyber Gap Program.

[47] He gave evidence that Captain Scott was the authorised person that he dealt with in Defence in relation to the delivery of the Cyber Gap Program. Captain Scott had decision making power over the terms of the contract on behalf of Defence, and was empowered under the terms of the contract to give Cybermerc directions including setting staffing expectations and requirements.

[48] At clause 24 of the contract, Mr Lavery is identified as specified personnel in the role of Program Director.

[49] Mr Nevin explained the events that took place from his receipt of the email from Captain Scott on 17 February 2022. He annexed the subsequent email exchange between him and Captain Scott to his witness statement. Of relevance, he received an email from Captain Scott on 18 February requesting that Mr Lavery be “removed from all interaction with my Cyber Gap Team from now”.

[50] In relation to the meeting on 18 February with Brigadier Watson and Captain Scott, Mr Nevin recalled that Brigadier Watson stated that Mr Lavery’s conduct was “an issue of safety to women” that needed to be “immediately rectified”. The second area of concern was the performance by Cybermerc of its contractual obligations, as managed by Mr Lavery. Mr Nevin said the performance concerns took him by surprise as Mr Lavery had not raised any issues, other than one matter that had been rectified.

[51] He said at the conclusion of this meeting, he and Ms Cavanagh were directed to another meeting with Captain Scott alone, who provided additional information about the concerns held by Defence. After the conclusion of this meeting Captain Scott said in an email to Mr Nevin: “Thank you for your acknowledgement and advice that Joe is no longer involved in the ADFCGP earlier in the evening”.

[52] Mr Nevin also gave evidence that in a letter received on 21 February from Brigadier Watson, he was advised that Cybermerc had 10 business days to rectify the deficiencies in performance of the contract, and should it fail to rectify the deficiencies, Defence had the ability under the terms of the contract to terminate the contract. Mr Nevin said this would have had the effect of ending Cybermerc as a business because the Cyber Gap Program was the main line of work at the time.

[53] Mr Nevin set out the events from the time he sent the letter containing the allegations to Mr Lavery on 21 February 2022. In considering Mr Lavery’s response, Mr Nevin said he was concerned that Mr Lavery had gone “on the offensive against Cybermerc”. He said Mr Lavery’s response demonstrated no accountability for his behaviour or work performance. After considering the response and Captain Scott’s position that he did not want Mr Lavery working on the Cyber Gap Program, Mr Nevin formed a view that he could not work on the Cyber Gap Program anymore.

[54] Mr Nevin said there were only two other very minor projects ongoing at this time, which were undertaken by junior staff members. As a result, there was nowhere Cybermerc could realistically deploy Mr Lavery.

[55] Because of this, Mr Nevin sent the Show Cause letter to Mr Lavery on 25 February 2022. Mr Nevin gave evidence that he considered the proposal put in response by Mr Lavery of a business development role, but this role was not required by the business and so was not a role to which he could be redeployed.

[56] On 9 March Mr Nevin received an email from Captain Scott which included the following:

“I note and appreciate the prompt action taken by you in removing Mr Lavery from involvement in the Cyber Gap Program as a result of the report of unacceptable behaviour.

In moving forward I request Mr Lavery not have further involvement in the delivery of the ADF Cyber Gap Program, for the certainty and safety of my staff, and the public facing reputation of the program.

Your sustained proactive management has ensured the significant concerns which prompted formal investigation have now been addressed for the ADF Cyber Gap Program.”

[57] Mr Nevin considered the request from Defence that Mr Lavery have no further involvement in the project to be unequivocal.

[58] After working to resolve the issues identified by Defence, Mr Nevin subsequently received correspondence from Brigadier Watson which included a statement that: “I am pleased to say that since this time, the standard of communications between Cybermerc employees and by Cyber Gap Year staff has improved markedly”, and “I am satisfied Cybermerc has taken proactive and positive actions to address my concerns ...”

[59] Finally, in response to Mr Lavery’s request to be reinstated, Mr Nevin set out the reasons why he considered the relationship between him and Mr Lavery had completely broken down, which are not repeated here.

Ms Cavanagh

[60] Ms Cavanagh commenced employment with Cybermerc in July 2021 in the role of Chief Operating Officer.

[61] She gave evidence that she has overall responsibility for managing Cybermerc’s operations and Mr Lavery reported to her in his role as Director of Training.

[62] She stated that Mr Lavery was working on the Cyber Group Program in a full time capacity. She gave the following evidence as to her involvement in the Cyber Group Program:

“In my role as COO I continued to maintain management and oversight of the contract while Joe delivered against the milestones within the contract. To do this, I utilised the daily Director Group briefings to identify any issues, and Joe attended these. Together with the CEO, Mr Matthew Nevin, I also ran in-depth weekly sessions to go through the progress of all work at hand and to plan for future work. During these sessions, I recall that Joe would usually say that the ADFCGP was progressing without any performance, communication, or other major issues, aside from concerns over Cybermerc having sufficient staff to produce all training materials within set time frames. At times, I discussed these matters with Matthew and we gave approval for Joe to source external contractors to surge support to the production of materials to meet the contracted deadlines. Occasionally, Paul Nevin, the Chief Technology Officer of Cybermerc, and I would personally provide support to ensure deliverables were produced on time.”

[63] She also gave evidence as to the meeting she attended with Mr Nevin, Brigadier Watson and Captain Scott, which was consistent with the evidence given by Mr Nevin. This included that Captain Scott said: “Joe can’t work on or be involved with the Cyber Gap Project anymore …”.

[64] Ms Cavanagh said that after Mr Nevin issued the Show Cause letter, she looked at whether she could redeploy Mr Lavery to another role however the Cyber Gap Project was the business’ main project and was going to continue to be so until the end of 2023. She said it became clear to her that there was no other role for him to perform.

[65] Ms Cavanagh agreed in cross examination that although Mr Lavery’s primary responsibility from October 2021 was the Cyber Group Program he was also expected to look out for other contracts and business opportunities. In this regard, she said:

“During the time we worked together, Joe indicated that there were multiple opportunities that he was pursuing but nothing came to fruition. The work with ADFCGP was our biggest contract and as such it made business sense for that to be Joe's near sole focus during this time. While there were some small revenue tasks that Joe contributed to at this time, the majority of his attention needed to be on the Cyber Gap Project.”

Mr Muller

[66] Mr Muller, Chief Executive Officer of Ionize Pty Ltd, gave evidence about Mr Lavery’s employment post-dismissal.

Submissions

[67] The submissions made by Mr Ward on behalf of Cybermerc contended that Mr Lavery’s employment was validly terminated on grounds of lack of capacity and the dismissal was not unfair within the meaning of s.385 of the Act.

[68] Mr Ward submitted that Cybermerc had a sound, well founded and defensible reason to terminate Mr Lavery’s employment on the following grounds:

“(a) the Respondent’s major client, the Department of Defence, directed the Respondent that the Applicant was no longer to work on the Cyber Gap program;

(b) The Respondent was under an obligation (by way of the contractual arrangements with Defence) to comply with the direction and removed the Applicant from the project in accordance with the direction it received in this regard;

(c) From October 2021 – when the Cyber Gap program contract was executed – up until the time of termination, the Applicant almost exclusively worked on the Cyber Gap program, and

(d) the Respondent gave reasonable consideration to whether it could assign or redeploy the Applicant, however it had nowhere to place, assign or redeploy him given the Cybermerc contract was the only significant training contract it had on foot at the time.”

[69] Mr Ward contended that Mr Lavery could no longer perform the inherent requirements of his role with Cybermerc as a result of Defence’s direction. It followed that he had no capacity to perform the duties and responsibilities of his role.

[70] Mr Ward relied on the interpretation of the word ‘capacity’ as given by the Full Court of the Federal Court in Crozier v Australian Industrial Relations Commission 2:

“A reason will be ‘related to the capacity’ of the employee where the reason is associated or connected with the ability of the employee to do his or her job.”

[71] Mr Lavery’s substantive job at the time of his dismissal, Mr Ward argued, was to work on the Cyber Gap program. Mr Lavery’s claim that he was employed to perform a broader range of duties than just the Cyber Gap program failed to take into account the change in his duties and responsibilities over time, and relevantly from the period in which he became specified personnel under the Work Order.

Consideration

[72] There is no dispute and I am satisfied that Mr Lavery is a person protected from unfair dismissal by virtue of s.382 of the Act. I now turn to consider if his dismissal was unfair within the meaning of the Act.

Was the dismissal unfair?

[73] A dismissal is unfair if the Commission is satisfied on the evidence before it that the circumstances set out at s.385 of the 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.

[74] There is no dispute that Mr Lavery was dismissed and that subsections (c) and (d) do not apply.

Was the dismissal harsh, unjust or unreasonable?

[75] Section 387 of the Act provides that, in considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the Commission 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.

[76] The ambit of the conduct which may fall within the phrase ‘harsh, unjust or unreasonable’ was explained in Byrne v Australian Airlines Ltd 3 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.”

[77] I am required to consider each of these criteria, to the extent they are relevant to the factual circumstances before me. 4

Valid reason - s.387(a)

[78] In order to be a valid reason, the reason for the dismissal should be “sound, defensible or well founded” 5 and should not be “capricious, fanciful, spiteful or prejudiced.”6 However, the Commission will not stand in the shoes of the employer and determine what the Commission would do if it was in the position of the employer.7

[79] There is no mandate for giving the ‘valid reason’ criterion any greater emphasis or weight than any of the other criteria in s 387. It is well settled that the statutory requirement to ‘have regard to’ or ‘take into account’ requires the Commission to give the matter(s) weight as a fundamental element in the decision making process. Even if it is found that there was a valid reason for the dismissal, an overall assessment must be made as to whether the dismissal was harsh, unjust or unreasonable.

[80] Further, the Commission does not ‘stand in the shoes’ of the employer but will need to be satisfied that the termination of the employee was for a valid reason. 8

[81] There is no mandate for giving the ‘valid reason’ criterion any greater emphasis or weight than any of the other criteria in s 387. It is well settled that the statutory requirement to ‘have regard to’ or ‘take into account’ requires the Commission to give the matter(s) weight as a fundamental element in the decision making process. Even if it is found that there was a valid reason for the dismissal, an overall assessment must be made as to whether the dismissal was harsh, unjust or unreasonable.

[82] I am satisfied that Mr Lavery’s dismissal was based on his capacity to perform the work required on the Cyber Gap Program and was not based on his conduct.

[83] I am also satisfied based on Mr Nevin’s evidence that Cybermerc’s contract with Defence allowed Defence to require that Mr Lavery be removed from the Cyber Gap Program.

[84] What is inescapable in this case is that Captain Scott, who was the officer with responsibility for the day to day management of the Cyber Gap Program for Defence, made it clear that he wanted Cybermerc to remove Mr Lavery from the Cyber Gap Program. This is evident from:

a. the email of 17 February in the email exchange with Mr Nevin asking that Mr Lavery be removed from all interaction with the Cyber Gap Team,

b. the email from Captain Scott on the evening of 18 February thanking Mr Nevin for his advice that Mr Lavery was no longer involved in the Cyber Gap Project,

c. the email Captain Scott sent to Mr Nevin on 9 March in which he expressed his appreciation for the prompt action Cybermerc took in removing Mr Lavery, and requesting that Mr Lavery not have further involvement in the delivery of the Cyber Gap Program; and

d. his verbal advice to Mr Nevin and Ms Cavanagh that: “Joe can’t work on or be involved with the Cyber Gap Project anymore …”.

[85] While I accept the uncontested evidence of Brigadier Watson, this does not change the communication from Captain Scott to remove Mr Lavery from the Cyber Gap Program. While Captain Scott used slightly softer language (ie ‘request’ rather than ‘require’ or ‘direct’) in asking that Mr Lavery be removed, there is no doubt in my mind that this was not a request Cybermerc could refuse. This is evident from his emails in the context of the meetings that occurred, and the view expressed by Captain Scott on behalf of Defence as to the seriousness of the matters he raised.

[86] Based on the emails sent by Captain Scott and the subsequent witness statement filed by Brigadier Watson, it seems there was a significant disconnect between Brigadier Watson and Captain Scott as to what ought to have been communicated to Cybermerc with respect to Mr Lavery’s ongoing ability to work on the Cyber Gap Project. Be that as it may, it does not change what was communicated by Captain Scott to Cybermerc, and that was a clear expectation that Mr Lavery be removed from the Cyber Gap Project.

[87] I am satisfied that at the time of his dismissal, Mr Lavery was working almost exclusively on the Cyber Gap Program. It is not in dispute that Cybermerc is a small business, with around 12 employees in total. I accept that Mr Lavery was not employed as a labour hire employee and was not engaged to perform work in such positions as may be assigned from time to time. However, I do accept the evidence of Mr Nevin and Ms Cavanagh to the effect that the Cyber Gap Program was to be the main focus of Cybermerc until the end of 2023 and it had no other substantive work for him to perform. The consideration of whether alternative duties were available was not a difficult task given the size of the business and the major focus in the Cyber Gap Program until the end of 2023.

[88] The termination letter makes clear that it was the requirement set by Defence that it remove Mr Lavery from the Cyber Gap Project that left Cybermerc with no option but to consider dismissal given it was unable to identify other substantive work for him to perform.

[89] I agree with Mr Lavery that there is no evidence to support the statement made by Mr Nevin in the termination letter to the effect that Defence would not permit Mr Lavery to be involved in other work for Defence, as opposed to work on the Cyber Gap Project. The reality, however, is that at the time of Mr Lavery’s dismissal Cybermerc did not have any other substantial projects with Defence, making it somewhat of a moot argument.

[90] For these reasons I am satisfied that there was a valid reason for Mr Lavery’s dismissal, that being his inability to be able to work on the Cyber Gap Program at the request of Defence.

Notification of the valid reason and opportunity to respond - s.387(b) and (c)

[91] Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made, 9 in explicit terms10 and in plain and clear terms.11 In Crozier v Palazzo Corporation Pty Ltd12 a Full Bench of the Australian Industrial Relations Commission dealing with similar provision of the Workplace Relations 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.” 13

[92] An employee protected from unfair dismissal must also be provided with an opportunity to respond to any reason for dismissal relating to the conduct or capacity of the person. Such requirement will be satisfied where the employee is aware of the precise nature of the employer’s concern about his or her conduct or performance and has a full opportunity to respond to this concern. 14 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.15

[93] The requirement to notify of the reason, together with the requirement to provide an opportunity to respond to the reason, involves consideration of whether procedural fairness was afforded to Mr Lavery before his dismissal was effected.

[94] I am satisfied that some of the allegations Mr Lavery was asked to respond to lacked sufficient specificity. The first allegation, for example, in the letter to Mr Lavery dated 21 February is simply that five female members of the ADFCGP team have made a formal complaint to Defence concerning Mr Lavery’s conduct. There was no explanation as to what conduct specifically led to such complaint. Likewise, the sixth allegation also lacks specificity. However, the remaining allegations did provide sufficient detail to allow him to respond.

[95] Mr Lavery contended that he ought to have been provided with the details of the allegations prior to a decision being made to suspend him. It is not unusual that a person may be suspended with pay while allegations are put to that person for their response. I do not consider this to be a matter that would render Mr Lavery’s dismissal unfair.

[96] Mr Lavery also contended that he was not provided with any evidence of his alleged misconduct and Mr Nevin adopted the accusations presented by Defence as unarguable facts. Had Mr Lavery been dismissed because of alleged misconduct, then this would be of considerable concern. However he was not dismissed because of alleged misconduct, he was dismissed because of the requirement of Defence to have him removed from the Cyber Gap Program, and he was told about this and given an opportunity to respond to it.

[97] Overall, I am satisfied that Mr Lavery was notified of the reason for his dismissal, and while the timeframe he was given to respond was short, he was given an opportunity to respond to the reason.

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

[98] 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.

[99] Mr Lavery was not refused a support person.

Warnings regarding unsatisfactory performance - s.387(e)

[100] Despite the fact that the complaints that were raised by Defence appeared to include unsatisfactory performance associated with Mr Lavery’s approach to the deliverables, Cybermerc did not rely on unsatisfactory performance as a reason for the dismissal and this factor is therefore not relevant to the present circumstances.

Impact of the size of the Respondent on procedures followed (s.387(f)), and the absence of dedicated human resources management specialist/expertise on procedures followed (s.387(g))

[101] Cybermerc is a small employer however Mr Nevin held legal qualifications. I do not consider that Cybermerc’s size impacted in any particular way on the procedures it followed.

Other relevant matters - s.387(h)

[102] I note Mr Lavery had a relatively short period of employment. Otherwise, I do not consider there are any other relevant matters that have not already been considered.

Conclusion

[103] Having considered each of the matters specified in s.387 of the Act and for the reasons set out above, I am not satisfied that the dismissal of Mr Lavery was unfair, in that it was not harsh, unjust or unreasonable. The application is therefore dismissed.

DEPUTY PRESIDENT

Appearances:
J Lavery, on his own behalf.
W Ward of Mills Oakley, for Cybermerc Pty Ltd.

Hearing details:
2022.
By video:
August 10.

Final written submissions:
7 September 2022.

Printed by authority of the Commonwealth Government Printer

<PR748572>

 1   [2017] FWCFB 1714.

 2   [2001] FCA 1031 at [14].

 3   (1995) 185 CLR 410 at 465 per McHugh and Gummow JJ.

 4   Sayer v Melsteel Pty Ltd [2011] FWAFB 7498, [14]; Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002), [69].

 5   Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373.

 6   Ibid.

 7   Walton v Mermaid Dry Cleaners Pty Ltd (1996) 142 ALR 681, 685.

 8   Miller v University of New South Wales (2003) 132 FCR 147.

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

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

 11   Previsic v Australian Quarantine Inspection Services Print Q3730.

 12   (2000) 98 IR 137.

 13   Ibid at 151.

 14   Gibson v Bosmac Pty Ltd (1995) 60 IR 1, 7.

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