[2013] FWC 7541

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Sheng He
v
Peacock Bros Pty Ltd
(U2013/6495)

Wilson Lac
v
Peacock Bros Pty Ltd
(U2013/6500)

COMMISSIONER WILSON

MELBOURNE, 27 SEPTEMBER 2013

Application for relief from unfair dismissal.

INTRODUCTION AND BACKGROUND

[1] There was an altercation in the Oakleigh premises of Peacock Brothers Pty Ltd on Wednesday 6 February 2013. Included in the altercation were Mr Sheng He and Mr Wilson Lac, both of whom were subsequently dismissed by Peacock Brothers for serious misconduct. Both Applicants were label printers and had long histories of employment at the company.

[2] The altercation commenced in the late morning, at a time between 11am and 12pm. It progressed through three phases - an initial argument between two people; a second, more heated argument, involving three people, and a third argument, involving fighting and four people.

First phase

[3] One of the Applicants, Mr He, asked Mr Michael Petrucci, a supervisor, to get him a roll of paper for his label printing machine, which Mr Petrucci did. The rolls are physically large, about 440mm wide 1 and weighing up to 250kg2. Mr He had to ask Mr Petrucci to do this since the forklift driver was away. In Mr He’s view the paper roll was incorrectly placed for his needs. It should have been aligned in a way that a machine operator could move the roll forward by hand and feed the paper to the machine. Mr He was frustrated by this and yelled out to Mr Petrucci3. An argument ensued between the two; Mr Petrucci left and brought Mr Steenveld back with him and the argument continued4. Heated words were exchanged.

Matters in dispute

[4] The events that followed in the second and third phases and in the subsequent meetings between the employer and each Applicant are the subject of considerable contest.

[5] The employer witnesses claim that both Mr He and Mr Lac viciously assaulted Mr Petrucci and that one or both of them had to be restrained. While Mr He does not agree he punched Mr Petrucci 5, the other applicant, Mr Lac, concedes that he did6, during his involvement in phases two and three of the altercation.

[6] The Applicants contest whether there was a valid reason for their dismissal and whether an investigation of sufficient standard was undertaken, and whether they were allowed to explain or put a contrary version of events to the employer before they were dismissed. The employer claims that each man was permitted to explain what occurred and that their explanations were taken into account in making the decision to dismiss.

[7] Evidence was received from each of the following;

• Mr Sheng HE – Label Printer



• Mr Wilson LAC – Label Printer



• Mr Michael PETRUCCI – Production Supervisor



• Mr William STEENVELD – Manufacturing Manager/Production Manager



• Ms Ruth KAPLAN – Joint Managing Director



• Ms Elaine MOORES – Financial Controller

[8] Mr He’s evidence includes the following;

• Mr He was frustrated by the placement of the paper roll. He called Mr Petrucci, “arsehole” 7 which was reciprocated by Mr Petrucci asking him “what’s your problem?”8

Mr Petrucci went to get Mr Steenveld, and when he returned Mr He continued swearing by calling Mr Petrucci “a fucking arsehole” 9. Mr Petrucci also swore at Mr He three or four times in the presence of Mr Steenveld10, calling him a “little cunt”11. Mr Steenveld did nothing to stop these words being said12.

This was followed by Mr He saying “I don’t want to argue with you in the factory. Step outside”. Mr He then said to Mr Petrucci “stop calling me a little cunt” 13, after which Mr Petrucci pushed Mr He backward causing him to “move back, it was about one metre”14.

[9] Mr Lac’s evidence included;

• That he was working nearby and heard the altercation.



• He saw Mr Petrucci push Mr He and moved toward Mr Petrucci 15.

He challenged Mr Petrucci, by saying words such as “why did you push Sheng?” 16 or “I saw you pushing Sheng”17.

• Mr Lac says Mr Petrucci pushed and swung at Mr Lac 18. While that didn’t connect, Mr Lac’s punch of Mr Petrucci did19.

[10] Mr Petrucci’s evidence includes the following;

• He was sworn at by Mr He after placing the roll of paper. He was called a “fucking arsehole” and a “fucking cunt” by Mr He 20.

He went to get Mr Steenveld. Shortly after Mr Steenveld arrived, Mr Petrucci swore at Mr He. Mr Petrucci agrees he called Mr He a “fucking arsehole” 21, but not “a little cunt”22. Mr He responded by approaching Mr Petrucci, to the point where their faces were close together. Mr He challenged Mr Petrucci to step outside, which he declined23.

Mr He put his knees into Mr Petrucci 24. Mr Petrucci pushed Mr He away from him25. Mr He went back about an arms length26 and came back to Mr Petrucci with his fists raised27. Mr Petrucci covered his head and was punched by Mr He several times to the side of his head28.

Mr Steenveld grabbed Mr He 29. Mr Lac had been out of sight on the other side of a machine, but came around when Mr Petrucci pushed Mr He away. Mr Lac punched Mr Petrucci several times, also to his head30.

Mr Petrucci saw that Mr Steenveld had restrained Mr He next to a rack of print cylinders 31. He saw Mr He reach for a heavy metal print cylinder and saw that he had his hand on it but that he was unable to pick it up32. He heard Mr Steenveld yell out to Mr He to put the print cylinder down33. Mr Steenveld might have had a hold of Mr Lac’s arm as well as restraining Mr He34.

Mr Petrucci denies taking a swing at Mr Lac 35.

[11] Mr Steenveld’s evidence on these events includes;

• Mr Steenveld became aware of the altercation when Mr Petrucci called him on the intercom 36. He went to the factory floor where he saw Mr He, with whom he was about to speak, when Mr Petrucci turned up.

Mr Steenveld saw Mr Petrucci push Mr He, which was after Mr He pushed his knees into Mr Petrucci 37. The kneeing was not violent38. Mr Petrucci did not take a swing at Mr He at the same time as pushing him39.

Mr He punched Mr Petrucci after he had been pushed away;

Mr Petrucci stepped back and Mr Steenveld grabbed Mr He in the form of a restraint 40;

Mr He moved toward and grabbed a print cylinder 41.

Immediately after this Mr Lac came around and punched Mr Petrucci twice 42; at about the same time Mr Steenveld grabbed Mr Lac’s hand43, as well as restraining Mr He.

[12] I accept Mr Steenveld’s evidence as the most reliable account of the events in dispute. He was not directly involved in the altercation, although he was dealing with the events as a manager. His recollection of events was firm and mainly consistent on each re-telling. He was in a position to see things that Mr Petrucci may not have (who concedes had his head and eyes covered at times 44).

[13] I also prefer Mr Petrucci’s evidence on critical issues over either Mr He’s or Mr Lac’s. His recount included issues that might otherwise reflect badly on him. His evidence includes that he did not provoke Mr He by swearing at him as badly as alleged, and that he did not push Mr He as hard as was alleged. In these respects I prefer Mr Petrucci’s evidence to Mr He and I find that Mr Lac was not in a position to either have overheard the initial verbal altercation, or to see how hard Mr Petrucci may have pushed Mr He.

[14] As a result, I find the following;

Phase 1

• The placement of the paper roll frustrated Mr He, who swore at Mr Petrucci.



• Mr Petrucci reciprocated with verbal abuse. After the verbal altercation had escalated, Mr Petrucci went to get Mr Steenveld.



• When Mr Steenveld returned, Mr He was swearing at Mr Petrucci.




Phase 2

• The dispute escalated with Mr He suggesting the two go outside. This may not have been meant aggressively, but was heard as such by Mr Petrucci. He declined, but swore repeatedly at Mr He.




Phase 3

• Mr He stepped toward Mr Petrucci, invading his personal space, and pushed his knees into Mr Petrucci. Mr Petrucci responded by pushing Mr He on the chest, who stumbled backward a small way, but not so much as to endanger him.



• Mr He swung at Mr Petrucci and punched him in the head several times.



• Mr Lac heard the altercation; came around and joined in. He punched Mr Petrucci to the head several times. Mr Petrucci did not swing at Mr Lac in return.



• Mr Steenveld restrained Mr He and grabbed Mr Lac’s hand or arm. He yelled at Mr He to put down a metal print cylinder. Although Mr He had his hand on it, he had not picked it up.



• Mr Petrucci left the area and the dispute subsided.

[15] I also find, viewed objectively, that none of Mr Petrucci’s actions on the day were sufficient to provoke the assault by either man and that he struck neither Applicant. His verbal abuse and shove of Mr He are not comparable.

[16] I find neither Mr He or Mr Lac were acting in self-defence.

[17] The evidence shows there were some prior tensions between the two Applicants and Mr Petrucci 45. The claim by Mr He that he invited Mr Petrucci to “come outside” in an attempt to discuss their differences46 is not consistent with how the events unfolded. Mr He’s claims about the first phase of the altercation are also not consistent with the how the matter progressed. Mr Petrucci was plainly concerned that something stronger than “arsehole” had been called out to him and the subsequent heat of the altercation is consistent with Mr He initiating the altercation with much stronger abuse than he claims.

[18] Following these events, Mr Steenveld and Mr Petrucci went to Ms Ruth Kaplan, the Joint Managing Director, and told her what had happened. Ms Kaplan spoke with Ms Moores, the Financial Controller and discussed what they should do. She decided to meet individually with both Mr He and Mr Lac and asked Mr Steenveld to ask Mr He to come to a meeting. By the time she met with Mr He and Mr Lac, the only version of events she had was from Mr Steenveld and Mr Petrucci, and that was only a verbal report. Ms Kaplan asked Mr Steenveld and Mr Petrucci to be in the meeting as well, together with Ms Elaine Moores, the company’s Financial Controller.

[19] Ms Kaplan’s oral evidence on what was said to each is very poor and so is not reliable. She was unable to relate sequentially what had been said to whom and was confused about what might have been said in the respective meetings. Mr Steenveld’s evidence is therefore preferred on the subject of the meetings with the Applicants.

[20] The management group met first with Mr He. Ms Kaplan told Mr He a complaint had been made about him and gave him general details of the complaint, and that if it was true, it was an act of serious misconduct 47. Ms Kaplan asked Mr Steenveld to repeat what he had told her, which he did. Mr Steenveld does not think Mr He said much in the meeting48; he does not recall Mr He claiming in the meeting that he had been called a “little cunt” by Mr Petrucci49. Ms Kaplan’s witness statement says she asked Mr He what he had to say about Mr Steenveld’s account and that he said very little50. Following the response, Ms Kaplan informed Mr He that she had no option to dismiss him and that the decision was immediate51.

[21] After meeting with Mr He, the management group met with Mr Lac. The course of the meeting took a similar path to that with Mr He. Ms Kaplan related a general understanding of what was alleged to have occurred 52 and that if it was true it was serious misconduct53. Mr Steenveld was asked to give details of the incidents54 and Mr Lac was invited to respond. Mr Steenveld agrees that Mr Lac said “will you listen to my explanation before making this decision”55 and that Ms Kaplan allowed him that opportunity56. He agrees Mr Lac said it would be unfair not to listen to the other witnesses downstairs57 and that it is really unfair to the two of them58 and that Mr Petrucci had been verbally abusive59. Following these responses, Ms Kaplan terminated Mr Lac’s employment60.

LEGISLATION

[22] The legislative provisions which are relevant to this matter are set out in s.387 of the Fair Work Act 2009 (the Act), which is as follows;

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.

CONSIDERATION

[23] In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the Fair Work Commission (the Commission) must take into account the legislative factors set out earlier.

(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)

[24] I have found that Mr Petrucci suffered blows to the head from both Mr He and Mr Lac and that he received them in the workplace in the course of his supervision of both employees. I have found that, viewed objectively, none of Mr Petrucci’s actions were sufficient to provoke the assault by either man. I have found that neither Mr He or Mr Lac were acting in self-defence.

[25] As a result, I find there was a valid reason for their dismissals from Peacock Brothers Pty Ltd related to Mr He and Mr Lac’s conduct (including its effect on the safety and welfare of other employees). Both men were aggressors and assaulted a supervisor. The conduct of each impinged on the safety and welfare of other employees. In the context of the events that occurred on the day, this was serious misconduct.

(b) whether the person was notified of that reason

[26] I find that Mr He and Mr Lac were notified of the reason, namely that they were being dismissed for serious misconduct, arising out of the assault earlier in the day.

[27] Each was notified in the course of a meeting held separately with them, the details of which are summarised above.

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

[28] I find the circumstances of the separate meetings between the managers and Mr He and Mr Lac did not allow either an opportunity to sufficiently respond to the reason for dismissal.

[29] Peacock Brothers contend that Ms Kaplan told each of Mr He and Mr Lac what they were alleged to have done and what the consequences may have been. However, even the most generous view of the evidence does not support this. Having decided she needed to meet with each employee, Ms Kaplan proceeded to conduct a meeting that was quite short and in which each was told what they had done, but without a meaningful or sufficient opportunity to provide either an explanation or contradictory evidence. Each Applicant was given a limited opportunity to respond, but the response was plainly not taken into account. When Mr Lac said Mr Petrucci had been verbally abusive, nothing was done about the allegation.

[30] Peacock Brothers did not afford either Mr He or Mr Lac an opportunity to know in advance the likely subject of the meeting (although the fact that it was to discuss the day’s earlier events would mostly likely have been apparent to them).

(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;

[31] Peacock Brothers did not offer either Mr He or Mr Lac an opportunity to have a support person present during these meetings, although neither requested a support person be present.

[32] The company failed to take into account that each man may need language assistance both to understand fully what was being put to them and to provide an adequate response.

[33] Both men emigrated to Australia from Vietnam as children and had some high schooling in Australia. Mr Lac was born in Saigon in 1974 and emigrated to Australia in 1986 61 and he attended high school in Australia, completing the VCE certificate in 199262. Mr He also emigrated to Australia. He was born in 1971 and migrated in 1987 when he was about 16 years of age63 and only completed about a year and a half of school in Australia, finishing in Year 1064.

[34] When giving evidence, each gave evidence in both English and Cantonese. While each had a need to seek translation assistance for particular questions, each also showed some English proficiency (for example by correcting the interpreter or by answering a question in English before it went through the interpreter). Even so, my impression is that each man had difficulty consistently understanding higher-level concepts when put in English. My assessment is that each is less than fully proficient in the English language. Mr Lac’s understanding of English is significantly better than Mr He’s who required a greater level of interpretation in the course of giving evidence.

[35] As a result, I find Mr He and Mr Lac were most likely at a disadvantage in the dismissal meetings because of their English language skills.

(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

[36] As I have found Mr He and Mr Lac were dismissed for serious misconduct, this consideration is not applicable to my analysis.

(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

[37] Ms Kaplan’s evidence included that Peacock Brothers employed 97 people at the time of the dismissals across three sites in Australia and New Zealand. She is one of two Joint Managing Directors of the company and one of five sisters who own the business.

[38] I am satisfied from the evidence the size of the employer’s enterprise impacted on the procedures it took to effect Mr He and Mr Lac’s dismissal. I am satisfied the events of 6 February 2013 and how to respond to them were without experience in the company. While the company had some protections in place for eventualities of the type experienced (eg: policies) it likely had not previously had to investigate or decide on misconduct. I am satisfied that in holding the meetings it did Peacock Brothers was trying to put into effect procedures it thought would provide protection.

(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;

[39] While the evidence is that Peacock Brothers is not a small business employer, within the meaning of the Act, Ms Kaplan is the only Joint Managing Director with responsibility for human resource management and she does not have training in the role 65.

[40] When she learned of the fighting and before she met with either Mr He or Mr Lac, Ms Kaplan took advice about what to do 66. While I note that the nature of the advice, or whether it was followed was not required to be produced to the hearing, I take account of the fact that Ms Kaplan sought advice before holding the meetings. In all the circumstances I am satisfied that Peacock Brothers is relatively unsophisticated in human resource management issues.

[41] I am satisfied that the size of the employer’s enterprise and its relative lack of sophistication with human resource matters impacted upon the investigation of the allegation of fighting; the way the allegations were put to both Applicants; and the subsequent decision to terminate their employment.

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

[42] It is relevant for me to take into account that Mr Petrucci was not completely without fault in the cause or development of the altercation.

[43] While I make no finding about whether he intended the placement of the paper roll to be a provocative action, I have found that he swore at Mr He in the first phase of the altercation, and swore again and repeatedly at Mr He in the second phase of the argument when Mr Steenveld joined them. I have found that he pushed Mr He in the chest; sufficient for him to be pushed back a short way, but not so much as to cause him to lose balance. I have found that he did not swing at Mr Lac as if to punch him.

[44] I have found that these actions by Mr Petrucci do not amount to behaviour that is comparable to either Mr He or Mr Lac’s, and note that Mr Petrucci received a written warning from Peacock Brothers for his actions 67. The fact that Mr Petrucci’s behaviour may have contributed to that of either or both the Applicant’s is taken into account. The differential treatment of comparable cases can be a relevant matter in determining if a dismissal is harsh, unjust or unreasonable68, however the issue does not arise in this case because Mr Petrucci’s behaviour was not comparable.

[45] It is relevant that I take all the above matters into account in forming a view about whether, despite there being a valid reason for Mr He and Mr Lac’s dismissal, in all the circumstances I must find their dismissal was harsh, unjust or unreasonable.

[46] The evidence leads to a finding that, despite there being a valid reason for their dismissal, in all the circumstances the dismissals of both Applicants was unfair, and in particular, I find that the dismissals were unjust and unreasonable. The dismissals were unjust and unreasonable because the employer did not have, at the time it chose to dismiss, a “sound, defensible or well founded” reason to dismiss 69.

[47] At the time it made its decision, the company had not fully investigated the circumstances of the events. It had not ascertained who might have witnessed any of the events, or as neutrally as possible, sought out alternative explanations for the actions or their causes. Such inquiries as were made consisted of discussions between Ms Kaplan and Mr Steenveld and Mr Petrucci. There is no evidence that any formal investigation of the events was conducted. Mr He and Mr Lac were not properly asked of their accounts, or alternative explanations. Such explanations as they provided were not really listened to.

[48] When the company made its decision to dismiss, it did so on the basis of what Mr Steenveld and Mr Petrucci said had occurred.

[49] As a result, the Applicants’ dismissals were unjust, since the dismissals did not take account of all the possible facts and did not take account of explanations the Applicants provided, or could have provided. The dismissals were also unreasonable since there was no proper investigation; there were no contrary explanations that could be taken account of; there was no balancing either of the contribution that Mr Petrucci’s behaviour may have made to the formation and progression of the altercation; and there was no demonstrable account taken of the service or employment record of either Mr He and Mr Lac.

REMEDY

[50] The sections of the Act dealing with remedy once a finding of unfair dismissal has been made are as follows;

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.

391 Remedy—reinstatement etc.

Reinstatement

(1) An order for a person’s reinstatement must be an order that the person’s employer at the time of the dismissal reinstate the person

by:

(a) reappointing the person to the position in which the person was employed immediately before the dismissal; or

(b) appointing the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.

(1A) If:

(a) the position in which the person was employed immediately before the dismissal is no longer a position with the person’s employer at the time of the dismissal; and

(b) that position, or an equivalent position, is a position with an associated entity of the employer;

the order under subsection (1) may be an order to the associated entity to:

(c) appoint the person to the position in which the person was employed immediately before the dismissal; or

(d) appoint the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.

Order to maintain continuity

(2) If the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC considers appropriate to maintain the following:

(a) the continuity of the person’s employment;

(b) the period of the person’s continuous service with the employer, or (if subsection (1A) applies) the associated entity.

Order to restore lost pay

(3) If the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC considers appropriate to cause the employer to pay to the person an amount for the remuneration lost, or likely to have been lost, by the person because of the dismissal.

(4) In determining an amount for the purposes of an order under subsection (3), the FWC must take into account:

(a) 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 reinstatement; and

(b) the amount of any remuneration reasonably likely to be so earned by the person during the period between the making of the order for reinstatement and the actual reinstatement.

392 Remedy—compensation

Compensation

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

Criteria for deciding amounts

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

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

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

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

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

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

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

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

Misconduct reduces amount

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

Shock, distress etc. disregarded

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

Compensation cap

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

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

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

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

(a) the total amount of remuneration:

(i) received by the person; or

(ii) to which the person was entitled;

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

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

[51] Pursuant to subsection 390(3) an order for the payment of compensation to a person must not be made unless the Commission “is satisfied that reinstatement of a person is inappropriate” and also that the Commission “considers an order for payment of compensation is appropriate in all the circumstances of the case.”

[52] I am satisfied that, in all the circumstances, the reinstatement of either Mr He or Mr Lac is inappropriate. Reinstatement of either would potentially undermine the ability of the company to maintain discipline.

[53] I am, however, satisfied that an order for payment of compensation is appropriate in all the circumstances of the case.

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

[54] The evidence includes, as referred to earlier, that Peacock Brothers is a long established firm with 97 employees in Australia and New Zealand. While the company submitted in respect of this criterion that it was facing competition and that matters were not easy 70, there was no evidence provided that would provide details about the effect of an order on the viability of the employer’s enterprise.

[55] I find the orders of compensation that I propose will not affect the viability of the employer’s enterprise.

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

[56] Mr He’s continuous service with Peacock Brothers is long. He commenced employment with Peacock Bros in 1994 71, meaning that he was about 19 or 20 years of age at the time. At the time of dismissal he had worked for the company for over 18 years.

[57] Drawing together Mr He’s employment history, it is appropriate I take into account the long length of his service with Peacock Brothers. While Mr He had received a employment related warning about 13 years prior 72, in the context of his long employment and the long time that has passed since it was issued, there is nothing to indicate dismissal was imminent for a further infraction of an extant warning. Balanced against this consideration is the fact that I have found Mr He was not truthful about striking Mr Petrucci.

[58] Mr Lac’s service with Peacock Brothers has been over two periods 73. The first was between 1994 and 2003, when he resigned to take employment elsewhere. This means he would have also been aged about 19 or 20 when he started with Peacock Brothers. The second period of service is from September 20, 2009, first as a casual employee and then as a full-time employee from 12 March 2010 until 6 February 2013. Collectively, these two periods of service mean that Mr Lac’s service is also long (about 12 or 13 years in total, which is not as long as Mr He’s). I was not informed that Mr Lac had received any employment related warnings. The fact that Mr Lac was considered for re-employment by Peacock Brothers in 2009 is taken into account by me as a factor in his favour.

[59] Drawing together Mr Lac’s employment history, it is appropriate I take into account the long length of his service with Peacock Brothers in determining an amount of compensation. I also take into account that Mr Lac conceded, without being forced to do so, that he had struck Mr Petrucci.

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

[60] In matters in which compensation is a consideration, the Commission ordinarily makes an assessment of remuneration the employee lost through dismissal, which in turn requires a finding in relation to “anticipated period of employment”. The Full Bench of the Australian Industrial Relations Commission has observed the following in relation to these matters;

[33] The first step in this process - the assessment of remuneration lost - is a necessary element in determining an amount to be ordered in lieu of reinstatement. Such an assessment is often difficult, but it must be done. As the Full Bench observed in Sprigg:

". . . we acknowledge that there is a speculative element involved in all such assessments. We believe it is a necessary step by virtue of the requirement of s.170CH(7)(c). We accept that assessment of relative likelihoods is integral to most assessments of compensation or damages in courts of law."

[34] Lost remuneration is usually calculated by estimating how long the employee would have remained in the relevant employment but for the termination of their employment. We refer to this period as the "anticipated period of employment". This amount is then reduced by deducting monies earned since termination. Only monies earned during the period from termination until the end of the "anticipated period of employment" are deducted. An example may assist to illustrate the approach to be taken.”  74 (endnotes omitted)

[61] Had each of Mr He and Mr Lac not committed serious misconduct and therefore not been dismissed, and had the dynamics of the workplace remained stable, they could have reasonably expected to have been employed by Peacock Brothers for some time, if not years. Notwithstanding this observation, there is evidence that there was factory floor tension between each of the Applicants and Mr Petrucci 75. I take that into account and that, if proper human resource management practices and procedures were in place to identify and resolve the tension, it would, most likely, have been resolved through either resigning or being dismissed within a 4 month period.

[62] In the alternative, and in light of the fact of serious misconduct by each, had Peacock Brothers properly investigated and considered the circumstances of the misconduct, each of Mr He and Mr Lac would have had their employment terminated within a period of two to four weeks of the events of 6 February.

[63] In making a finding about remuneration that the person would have received until the end of the "anticipated period of employment", I have taken into account the criterion set out in s.392(3) of the Act, which requires me to reduce an amount of compensation in the event of a finding of misconduct. The subsection provides as follows;

“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.”

[64] In considering the possible extremes, and after taking into account factors I have referred to about the employment history of each, I find that the “anticipated period of employment” for both applicant was two weeks.

[65] The evidence provided by the applicants regarding their earnings prior to dismissal, which was not contradicted by the employer is the following;

• Mr He’s earnings averaged $1087.88 per week, which were calculated on the basis of total earnings of $19,582.62 for the 18 weeks prior to dismissal 76;



• Mr Lac’s earnings averaged re $1129.60 per week, which were calculated on the basis of total earnings being $35,017.50 in the 31 weeks prior to dismissal 77.

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

(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

(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

[66] Both Mr He and Mr Lac gave evidence that each had sought to obtain employment after their dismissal and received some payment as a result of their efforts. In summary, their evidence was;

• Mr Lac had sought employment, and the only work he had at the time of the hearing was for three weeks, during which he earned $2,177.88. 78

Mr He had also sought employment after he was dismissed and at the time of the hearing was working for three days per week. Between the date of dismissal and the time of the hearing Mr He had earned approximately $7200 in employment. 79

[67] As a result I am satisfied that each applicant took reasonable efforts to mitigate the loss suffered because of their dismissal.

[68] These amounts each applicant received in the way of post-dismissal remuneration are not significant and, within the context of the order I make, are not sufficient to require an adjustment to the amount of compensation I order.

[69] There is no evidence before me of any amounts of which I should take account in the nature of income likely to be earned by either applicant between the making of the order for compensation and the provision of compensation.

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

[70] I am not aware of any other considerations which might be relevant to the order of compensation, and have considered all of the circumstances of the case in determining an appropriate remedy.

CONCLUSION AND ORDERS

[71] After consideration of the foregoing issues, I find that each of the Applicants, Mr He and Mr Lac, was dismissed and each dismissal was unfair within the meaning of the Act.

[72] I find that reinstatement is not an appropriate remedy in either case.

[73] I find that compensation is appropriate.

[74] In accordance with the principles set out in Sprigg and Ellawala , I will determine in the following manner;

“Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).

Step 2: Deduct monies earned since termination.

Step 3: Discount the remaining amount for contingencies.

Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.” 80

[75] In relation to the matter of contingencies, I find there are none that ought be taken into account in this matter.

[76] Having regard to the considerations established by s.392 of the Act, and the criteria established by the Commission I find that compensation should comprise a payment by the respondent to each applicant calculated as set out below (and I comment that relevantly, “monies earned since dismissal” in this case are set at nil, since the periods to which the earnings relate are after the “anticipated period of employment” I have found of two weeks for each Applicant):

Sheng HE
Assessment of remuneration lost:	2 weeks projected lost income at the rate of $1087.88 per week	$2175.76
Employer superannuation contribution on above	9%	$195.82
LESS:	Monies earned since dismissal	$0
LESS:	Contingencies	$0
TOTAL		$2371.58

Wilson LAC
Assessment of remuneration lost:	2 weeks projected lost income at the rate of $1129.60 per week	$2259.20
Employer superannuation contribution on above	9%	$203.33
LESS:	Monies earned since dismissal	$0
LESS:	Contingencies	$0
TOTAL		$2462.53

[77] The above amount does not exceed the compensation cap applying at the time of dismissal.

[78] The compensation payments to each Applicant will be taxed by the employer according to law, and is to be made within 14 days of this decision.

[79] An order to the above effect has been issued in conjunction with this decision.

COMMISSIONER

Appearances:

Mr G. Dirks, for the Applicants

Mr D. Jones, solicitor, for Peacock Brothers Pty Ltd

Hearing details:

2013.

Melbourne:

July 4, 5 and 24.