DECISION

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

Inessa Barkhazen
v
Conair Australia Pty Ltd
(U2016/201)

Unfair dismissal - summary dismissal - serious misconduct - finding of employer confirmed - valid reason - dismissal not harsh, unjust or unreasonable - application dismissed.

[1] This matter involves an application for unfair dismissal remedy made pursuant to section 394 of the Fair Work Act 2009 (the Act). The application was lodged at Sydney on 13 January 2016. The application was made by Inessa Barkhazen (the applicant) who has been represented by GP Legal, and the respondent employer is Conair Australia Pty Ltd (the employer or Conair) who have been represented by PCC Lawyers.

[2] The application indicated that the date that the applicant’s dismissal took effect was 4 January 2016. Consequently, the application was made within the 21 day time limit prescribed by subsection 394 (2) of the Act.

[3] The matter was not resolved at conciliation, and it has proceeded to arbitration before the Fair Work Commission (the Commission) in a Hearing conducted at Sydney on 30, 31 May, and 16 June 2016.

[4] At the Hearing, the applicant was granted permission to be represented by Mr Peter E King, barrister, instructed by Mr B Gelonesi, solicitor from GP Legal. Mr King called the applicant and two other witnesses who provided evidence in support of the unfair dismissal claim. Conair was granted permission to be represented by Ms K Jones, barrister, who was instructed by Ms L Gleeson, solicitor from PCC Lawyers. Ms Jones called two witnesses who provided evidence on behalf of the employer.

Background

[5] The applicant had worked for the employer for about 4 years and 4 months. The applicant was employed as an Accounting, Tax and Payroll Manager. The applicant worked at the Conair Sydney office located in the suburb of Frenchs Forest.

[6] The applicant performed a variety of administrative, managerial and record-keeping functions including what is referred to as human resources management. Apart from her other roles the applicant was described as the employer’s HR manager. As HR manager, the applicant was responsible for, inter alia, maintaining and securing all documentary records concerning the employment of all employees. These records have included what has been referred to as an individual employee’s HR file. The applicant was a highly regarded manager with an exceptional work record.

[7] Conair is the Australian subsidiary of Conair Corporation which is based in the United States of America. Conair employs approximately 48 employees in Australia. Conair operates a commercial wholesaling business which sells hair, beauty and kitchen appliance products to retailers.

[8] The chain of events which led to the dismissal of the applicant commenced on the afternoon of Friday, 25 September 2015, when the applicant participated in a discussion amongst a number of other managers regarding accounting for stock which had been written off. The stock had to be written off in the accounts of Conair as it had been destroyed because it could not be sold once it had passed its “use by” date. On the following Monday, 28 September 2015, one of the managers who had been involved in the discussion of the preceding Friday, Mr Seeley, sent an email message to the applicant which criticised aspects of the applicant’s participation in the discussion that occurred on the previous Friday.

[9] The email sent to the applicant on 28 September included mention of allegations of impropriety that had apparently arisen during the discussion on 25 September. The applicant objected to the suggestion that she had in any way acted improperly during the discussion on 25 September, and she sought a written apology from Mr Seeley in respect to accusations made against her which she believed to be contained in the email of 28 September.

[10] On 30 September 2015, the applicant lodged a formal complaint regarding the email sent by Mr Seeley on 28 September. The employer subsequently engaged external HR consultants in the form of PCC Lawyers, to conduct an investigation into the complaint made by the applicant. PCC Lawyers investigated the applicant’s complaint, and issued a report dated 15 October 2015, to the Directors of Conair about the matter.

[11] In broad terms, the report of PCC Lawyers rejected the applicant’s complaint, and found instead that the applicant’s conduct during the conversation on 25 September 2015 was not appropriate and was unjustified, particularly given her role as HR manager. The PCC Lawyers report recommended that the applicant cease providing any advisory HR functions and undertake coaching to improve her interpersonal and communication skills in the workplace.

[12] On 29 October 2015, Ms Carter, a lawyer from PCC Lawyers met with the applicant in order to discuss the outcomes that were anticipated following the investigation and report into the formal complaint made by the applicant. The applicant was advised that her complaint had not been substantiated, and she would not be provided with any form of apology from Mr Seeley in respect to the email of 28 September. The applicant was told that she was to “move on” and to take no further action regarding the matter. The applicant was reminded that she was a valued staff member, and that she should continue to perform her high standard of work. The applicant was told not to pursue any form of apology from Mr Seeley.

[13] The applicant was not provided with a copy of the PCC Lawyers report, and she was dissatisfied with the verbal advice provided to her by Ms Carter on 29 October 2015. The applicant sought to be provided with a formal response to her complaint. Ms Carter attempted to arrange a further meeting with the applicant in order to provide more details about the PCC Lawyers investigation, the report, and the outcomes that were anticipated to follow.

[14] On Thursday, 3 December 2015, Mr Seeley came into the applicant’s office to give the applicant a HR document regarding another staff member. The applicant then briefly engaged Mr Seeley in discussion about the PCC Lawyers investigation and report, and she further enquired as to why he would not apologise about the email that he had sent to her on 28 September.

[15] Mr Seeley complained to his superior, Conair’s Finance Director, Mr Howell, about the applicant’s on-going agitation of complaint against him. Mr Howell telephoned Ms Carter who then travelled to Conair’s offices in order to meet with the applicant. The applicant was called into a meeting with Ms Carter and Mr Seeley.

[16] The meeting of 3 December 2015 involved the applicant being challenged about her on-going pursuit of an apology from Mr Seeley. Prior to the meeting commencing, Ms Carter and Mr Howell had decided that the applicant would be put on special leave with pay and that allegations regarding her on-going pursuit of an apology from Mr Seeley would be documented and provided to her so as to elicit a response. The applicant did not react well to the prospect of being suspended from work on full pay indefinitely, and the meeting appeared to have become somewhat difficult and strained.

[17] At some point in the meeting, the applicant was advised that she would be required to undertake an independent medical assessment while she was on paid special leave. The applicant requested that she not be escorted from the office by Ms Carter in order to avoid embarrassment. Ms Carter agreed to this request, and she allowed the applicant to return to her office to collect personal possessions before leaving the workplace. The applicant went to her office unaccompanied by Ms Carter, and she collected her personal possessions. At this time, unbeknown to Ms Carter or Mr Howell, the applicant also took her personal HR file.

[18] After the applicant had left Conair’s office, she was contacted by Mr Bevan who was one of the other managers who had been involved in the discussion of 25 September, regarding the accounting for stock that had been destroyed and written-off. Mr Bevan advised the applicant that he had concerns about the circumstances surrounding the destruction of the written-off stock, and he had conveyed these concerns confidentially to Conair’s auditor, Ms Suann Ng, who was based in Hong Kong. Essentially, the concern involved a lack of documentary confirmation regarding the destruction of the written-off stock which was recorded to be valued at AU$65,730.57, and there was, by inference, a suggestion that there may have been some impropriety or even illegality connected with the written-off stock.

[19] On Friday, 4 December 2015, the applicant sent an email to Conair’s auditor, Ms Suann Ng, which advised that she had been forced to go on indefinite sick leave in relation to the investigation into the “missing written off stock”. The applicant advised that she was being forced to see a psychiatrist, locked out of the company’s offices, and cut off from the company’s emails and that these actions were taken, by inference, in connection with the written-off stock investigations.

[20] On Monday, 7 December 2015, Ms Carter sent an email to the applicant which, inter alia, confirmed that the applicant had been placed on special leave on full pay, and that an appointment had been made for the applicant to attend an independent psychiatric medical assessment scheduled for 11 January 2016. Later that day, Ms Carter received a letter from GP Legal which inter alia, advised that GP Legal had been instructed by the applicant. The letter from GP Legal of 7 December 2015, also included a series of questions regarding aspects of the applicant’s suspension from duty, and the foreshadowed independent medical examination. The letter from GP Legal concluded by requesting an “immediate response” and for the inquiries to be dealt “with extreme urgency.”

[21] On the following day, 8 December, PCC Lawyers provided a response to GP Legal in a letter which answered the inquiries made on behalf of the applicant. This letter confirmed the medical appointment arrangements for the applicant, but it incorrectly nominated the date of 11 January 2015 instead of 2016.

[22] On 10 December 2015, GP Legal sent a letter dated 8 December 2015, to PCC Lawyers which was entitled “Barkhazen - Fair Work Commission” and which raised a series of further questions. This letter also made assertions such as: that the applicant’s rights to procedural fairness had been “trashed”; the conduct of Ms Carter and Mr Howell amounted to, (a) bullying of the applicant as contemplated by s. 789FC of the Act, and (b) mistreatment of the applicant involving potential for charges pursuant to section 60 of the Crimes Act 1900. This letter from GP Legal also stated that the arrangements for the medical assessment of the applicant represented a “phoney doctor’s appointment”.

[23] On Monday, 14 December 2015, PCC Lawyers sent a letter to GP Legal in response to their letter dated 8 December 2015. In this communication, PCC Lawyers rejected the various assertions made by GP Legal in their letter dated 8 December. In particular, PCC Lawyers rejected the suggestion that the applicant had been bullied at work, and noted that s. 60 of the Crimes Act 1900 (NSW) deals with assault and other actions against police officers. Further, the letter from PCC Lawyers of 14 December raised the issue of the applicant’s HR file being missing from Conair’s premises. The 14 December letter from PCC Lawyers questioned whether the applicant had her HR file in her possession, and sought information about the location of the HR file as a matter of urgency. The letter advised that HR files were the property of Conair, and that if the applicant did not return the file she would be in breach of her duties owing to her employer.

[24] On Friday, 18 December 2015, GP Legal sent a further letter to PCC Lawyers which noted the response to the letter dated 8 December 2015, thereby referring to the previous letter from PCC Lawyers of 14 December 2015. However, this letter did not provide any response or otherwise mention the issue of the whereabouts of the applicant’s HR file.

[25] On Monday, 21 December 2015, PCC Lawyers sent a further letter to GP Legal which, inter alia, noted that there had been no response to the previous request regarding the whereabouts of the applicant’s HR file. This letter again stated that the HR file was the property of Conair, who demanded its immediate return. Further, the letter indicated that a clear response in respect to the issue of the HR file was required by no later than 5 pm on Tuesday, 22 December 2015.

[26] PCC Lawyers did not receive any response from GP Legal by 5 pm on 22 December 2015. PCC Lawyers then sent a further letter to GP Legal on 23 December 2015, indicating that Conair was very concerned about the whereabouts of the applicant’s HR file, and it provided a final opportunity for the file to be returned or other information about the HR file be provided by no later than 5 pm on 24 December 2015. Further, this letter advised that in the absence of either the return of the HR file, or some clear statement as to any knowledge of the whereabouts of the HR file, Conair would consider taking disciplinary action which was likely to involve the summary termination of the applicant’s employment for wilful misconduct.

[27] PCC Lawyers did not receive any response from GP Legal by 5 pm on 24 December 2015. On Monday, 4 January 2016, PCC Lawyers had received no response from GP Legal in response to the letters of 21 and 23 December 2015 which demanded the return of the applicant’s HR file or information about its whereabouts. Ms Carter discussed these circumstances with Conair’s Finance Director, Mr Howell, who decided that the absence of any response from the applicant’s legal representatives regarding the whereabouts of the applicant’s HR file, represented the applicant’s failure to comply with a lawful and reasonable direction. Consequently, the applicant was considered to have engaged in wilful misconduct and it was decided that her employment should be summarily terminated.

[28] On Monday, 4 January 2016, PCC Lawyers sent a letter to GP Legal which advised of the summary dismissal of the applicant on the basis of wilful misconduct involving the applicant’s failure to comply with a lawful and reasonable direction regarding her HR file, and its removal from Conair’s offices. The mobile phone provided to the applicant by Conair was also cancelled on or about 5 pm on 4 January 2016.

[29] On Friday, 8 January 2016, GP Legal sent a letter to Ms Carter which, inter alia, raised complaint about what it described as a “preposterous letter of demand” in reference to the letter of dismissal of the applicant dated 4 January 2016. The letter from GP Legal also stated that Ms Carter’s “conduct in this matter is reprehensible and must and will be reported to the Law Society in due course.”

[30] On 8 January 2016, PCC Lawyers responded to the letter from GP Legal sent earlier that day. In this response, PCC Lawyers broadly rejected what it described as “baseless assertions” contained in the letter of earlier that day from GP Legal. The letter from PCC Lawyers of 8 January 2016, also referred to the previous letters of 21 and 23 December requiring urgent attention in relation to the applicant’s HR file and stated, inter alia, “Your office was open on those days and this was confirmed by us prior to the letters being sent to you.”

[31] Between 7 January 2016 and 24 February 2016, the applicant communicated with Mr Anthony Verde who apparently occupies a senior position (VP Internal Audit), with Conair’s USA parent company, Conair Corporation. The applicant had advised Mr Verde about “stock irregularities and other malpractices” which had been the subject of the earlier communications from her and Mr Bevan to Ms Ng in Hong Kong.

[32] Mr Verde and other senior managers of Conair Corporation (USA) conducted an investigation into the claims that were raised by the applicant. In a communication sent to the applicant on 24 February 2016, Mr Verde advised, inter alia; that the investigation into the applicant’s claims had been completed; the claims that the applicant had made were completely unrelated to the termination of the applicant’s employment with Conair; a great deal of care had been taken in reviewing all of the issues and claims that the applicant had made; and the matter was closed. Further, Mr Verde advised the applicant that Conair Corporation was fully aware that PCC Lawyers had required the return of Conair property from the applicant, and that given that the investigation had been completed that material should be returned immediately.

[33] On 8, 11, and 16 February 2016, PCC Lawyers sent further letters to GP Legal which, inter alia, required the applicant to return all of Conair’s property or confidential information in her possession, including her personal HR file. PCC Lawyers did not receive any response from GP Legal in connection with the return of Conair’s property until shortly before the commencement of the first day of Hearing, 30 May 2016, when Mr Gelonesi from GP Legal handed the applicant’s HR file to Ms Gleeson from PCC Lawyers.

The Case for the Applicant

[34] Mr King, who represented the applicant, made oral submissions which elaborated upon documentary closing submissions which he handed up to the Commission. In addition, the applicant relied upon written submissions which had been filed on 27 April 2016.

[35] The oral submissions made by Mr King commenced with an analysis of the various witnesses who had provided evidence during the Hearing. In particular, Mr King made submissions which were critical of the performance of Mr Howell as a witness. Mr King submitted that Mr Howell provided evidence which he described as evasive and unforthcoming.

[36] The submissions made by Mr King mentioned that the applicant’s suspension and her subsequent termination on 4 January 2016, were matters that should be properly considered as protected disclosures under section 1317AA of the Corporations Act. Mr King submitted that the actions of Conair were prohibited under section 1317AB (iii) of the Corporations Act. Mr King submitted that the protected disclosure question went directly to the heart of the issue under any other reason contained in section 387 of the Fair Work Act.

[37] Mr King further submitted that an analysis of the evidence provided by Ms Carter demonstrated significant inaccuracies in respect to the precise timing of the meeting that occurred on 3 December 2015. Mr King submitted that the evidence provided by Ms Carter should be treated with caution, as she did not disassociate herself as a professional solicitor from the respondent. Further, Mr King submitted that there was a lack of objectivity in the answers and elaborate explanations that were provided by Ms Carter.

[38] Mr King submitted that the evidence provided by the applicant should be accepted, and in particular, her evidence that she genuinely raised issues of concern regarding the accuracy of financial records of the respondent in accordance with section 286 of the Corporations Act. Mr King also briefly mentioned the evidence provided by Mr Gelonesi which he said was not the subject of dispute, and which involved Mr Gelonesi not opening or sending to the applicant the letters of 21 and 23 December 2015 until after 4 January 2016. Mr King submitted that this evidence was important because it verified that the applicant could not have failed to comply with the lawful direction of the employer prior to 4 January, because she was not aware of the material which had not been opened by Mr Gelonesi.

[39] Mr King made further submissions which referred to section 387 of the Act and also to clause 7 of the contract of employment of the applicant. Mr King submitted that there was no notice given to the applicant as was stipulated in the contract of employment document, and in respect to section 387 (a) of the Act there was no valid reason for the summary dismissal of the applicant on 4 January 2016. Mr King also referred to section 387 (b) of the Act and he said that the respondent had failed to afford procedural fairness before sending the termination letter to the applicant. Mr King submitted that the applicant simply had not had a reasonable opportunity with respect to the specific matters used to terminate her contract of employment. Mr King said that even if the letters of 21 and 23 December had been received by Mr Gelonesi and sent on to the applicant prior to 4 January, there was still not an adequate or reasonable opportunity to consider the position having regard to the Christmas season.

[40] It was also submitted by Mr King, that section 387 (c) of the Act was relied upon as a basis to establish that the dismissal of the applicant was harsh, unjust or unreasonable. Mr King submitted that the applicant was not given a proper opportunity to respond as she was unaware of the contents of the letters of 21 and 23 December 2015.

[41] Mr King also referred to section 387 (h) of the Act and in respect of other matters, Mr King said that the applicant was an impeccable employee with a flawless record who was just thrown to the wolves. Mr King said that the applicant had been unlawfully dismissed having regard to subsection (h) of section 387 of the Act.

[42] Mr King also submitted that as the applicant had been unfairly dismissed she should receive the full complement of the courts jurisdictional powers in relation to compensation. Mr King submitted that the applicant should be entitled to compensation of $55,000 and interest on 50% of that sum should be awarded to make good the delay in making the payment.

[43] The closing submissions made on behalf of the applicant also addressed the various aspects of section 387 of the Act. It was submitted that the dismissal of the applicant was not for valid reason and was accordingly an unfair dismissal. Further, it was submitted that the applicant had taken her HR file with her on the day that she was suspended pending further developments, and for her protection. In respect to the question of remedy, it was also submitted that the applicant claimed interest and an injunctive order preventing the respondent making false accusations against her mental condition in the future.

[44] Further submissions made on behalf of the applicant also dealt with the purported reason for the applicant’s dismissal being misconduct relating to her failure to return her personal HR file. It was submitted that at the time the applicant was suspended from duty, she was concerned that her HR file was the only objective evidence that could show that she was a diligent and productive employee. Further, the applicant feared that the respondent would alter her performance records if she returned the file to them. Consequently, she did not disclose the fact that she had the HR file.

[45] In summary, Mr King submitted that there was no valid reason for the dismissal of the applicant and she had no reasonable opportunity to have been afforded procedural fairness. Mr King submitted that the respondent willy-nilly went ahead and sacked the applicant.

[46] In conclusion, Mr King submitted that the Commission should grant to the applicant the remedies that had been sought. It was also submitted that the applicant had formally proved the statutory jurisdictional requirements of an action for compensation under the Act, and a handwritten schedule was provided which totalled a requested remedy of $60,500 including 73 days of interest calculated at 5%.

The Case for the Employer

[47] The employer was represented by Ms Jones, who commenced her oral submissions by stating that the dismissal of the applicant was substantively and procedurally fair. Ms Jones made submissions which referred to documentary material dated 18 May 2016, which had been filed on behalf of Conair, together with further documentary closing submissions that were handed up to the Commission.

[48] Ms Jones submitted that the reason for the dismissal of the applicant was serious misconduct, and that that matter had been wholly ignored by the submissions made on behalf of the applicant. The misconduct of the applicant was, according to the submissions of Ms Jones, that of a trusted manager who took the employer’s property, and when the employer asked for its return, she refused to give it back. Ms Jones submitted that the refusal to return the employer’s property continued right up until the morning of the first day of the Hearing.

[49] Ms Jones made submissions which stressed that the evidence was consistent in respect to the fact that the HR file was taken by the applicant, the respondent asked the applicant where it was or to return it, she did not respond to those requests, and those were lawful and reasonable directions. In these circumstances, according to Ms Jones, the actions of the applicant amounted to serious misconduct warranting summary dismissal.

[50] Ms Jones submitted that even if it was the case that the applicant didn’t receive the letters of 21 and 23 December, there remained a valid reason for dismissal because even on learning of the content of those letters, the HR file was not returned until shortly before the commencement of the first day of Hearing. Ms Jones stressed that the respondent had sent at least eight requests asking for the return of the applicant’s HR file.

[51] It was also submitted by Ms Jones that in addition to there being valid reason for the dismissal of the applicant, the process that the employer adopted was fair. In this regard Ms Jones noted that both Parties were legally represented from an early stage, and communications were occurring between the respective lawyers. In these circumstances, according to the submissions of Ms Jones, there was no reason to believe that the letters sent by email on 21 and 23 December had not been received by the applicant’s solicitor.

[52] It was further submitted by Ms Jones that there had been a further four requests following the dismissal of the applicant, for the return of the HR file, and there had been no response received to any of these letters. Ms Jones submitted that the conduct of the applicant and the applicant’s solicitor, was entirely a matter in the hands of the applicant and her legal representatives. Ms Jones said that the applicant knew of the importance of the material that she took from the respondent, and even if there was some procedural deficiency caused by the applicant’s solicitor, that deficiency has not impacted in any way on the subsequent failure to return the HR file.

[53] Ms Jones made further submissions which rejected complaint that the applicant was not provided with a support person at the meeting that occurred on 3 December 2015. Ms Jones submitted that this meeting was not a disciplinary meeting, and was held for the purpose of having the applicant commence special paid leave so that in due course she could provide a response during a meeting where she could be provided with a support person. Ms Jones submitted that any purported deficiency concerning the meeting of 3 December 2015 was irrelevant to the determination of whether the applicant was unfairly dismissed.

[54] It was further submitted by Ms Jones that evidence regarding what was described as protected disclosures or whistleblowing as representing the reason for dismissal should be rejected. Ms Jones noted that Conair Corporation had conducted an investigation and were ultimately satisfied with the write-off of $65,000 worth of stock. In any event, according to the submissions made by Ms Jones, the accounting matters and other issues raised by the applicant were not connected to the reason for her dismissal.

[55] Ms Jones submitted that the applicant was dissatisfied with the outcome of the investigation into her complaint regarding the email of 28 September from Mr Seeley. Ms Jones submitted that the applicant had become fixated on receiving a written report and an apology from Mr Seeley. Ms Jones said that the applicant had refused to accept the position determined by Conair in respect to her complaint and she continued to pursue the matter with Mr Seeley, and it was these events which ultimately led to the applicant’s dismissal as opposed to any of the matters relating to accounting for written-off stock or other similar issues.

[56] Ms Jones also submitted that the valid reason for the dismissal of the applicant was her failure to respond to the lawful and reasonable direction to advise Conair if she had the HR file or if she didn’t, and that the evidence has now subsequently clarified that she did have the HR file all along. Ms Jones rejected the proposition that because the applicant may not have seen the letters of 21 and 23 December 2015, she could not have contravened the reasonable and lawful direction of the employer. Ms Jones submitted that there had been no response provided to any of the requests made for information or return of the applicant’s HR file.

[57] Ms Jones submitted that on any version of the events, the solicitor for the applicant had engaged in conduct over a prolonged period of time from 14 December 2015 until 30 May 2016 which fell well below the minimum standards of a legal practitioner.

[58] In summary, Ms Jones submitted that the applicant was not entitled to any remedy as the dismissal was not harsh, unjust or unfair. Ms Jones further submitted that even if the Commission was to find that there was some element of unfairness in the dismissal of the applicant, factors such as the misconduct of the applicant, and the absence of any evidence of attempts to find alternative work, should see any amount of compensation reduced by 100%.

[59] In conclusion, Ms Jones submitted that the evidence established that the applicant’s conduct was serious and wilful, and that even if the conduct of her solicitor impacted upon the circumstances at the time of the dismissal, the subsequent failure to comply with the requests for the return of the employer’s property represented basis for there to be no remedy provided to the applicant. The employer submitted that the application for unfair dismissal remedy should be dismissed.

Consideration

[60] Section 385 of the Act stipulates that the Commission must be satisfied that four cumulative elements are met in order to establish an unfair dismissal. These elements are:

“(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.”

[61] In this case, there was no dispute that the matter was confined to a determination of that element contained in subsection 385 (b) of the Act, specifically whether the dismissal of the applicant was harsh, unjust or unreasonable.

[62] Section 387 of the Act contains criteria that the Commission must take into account in any determination of whether a dismissal is harsh, unjust or unreasonable. These criteria are:

“(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.”

387 (a) - Valid reason for the dismissal related to capacity or conduct

[63] In this instance, the applicant was summarily dismissed for misconduct involving a failure to comply with a lawful and reasonable direction of the employer. The direction of the employer, conveyed through their lawyers to the applicant’s lawyers, involved either the return or information regarding the whereabouts, of the applicant’s HR file. At the time of dismissal the employer was not certain that the applicant had removed her HR file from the records held at its premises. The failure of the applicant’s lawyers to provide any response to the repeated inquiries concerning the HR file was construed by the employer to represent a failure on the part of the applicant to comply with lawful and reasonable directions.

[64] In circumstances where communication regarding very serious employment related matters is transacted between legal representatives for the respective parties, it would be reasonable to expect that all communication would, at very least, be acknowledged and responded to, even if only in an elementary manner, perhaps indicating that a more comprehensive response would subsequently be provided once instructions had been obtained from the client. The absence of any response or even acknowledgement regarding the issue of the applicant’s HR file, as communicated in the letters from PCC Lawyers on 14, 21 and 23 December 2015, represented a very disturbing and highly regrettable failure of the applicant’s lawyers to take any basic action to protect the interests of the applicant.

[65] As the circumstances had developed from 14 December up until the first week of January 2016, the employer (and its lawyers) was entitled to assume that the absence of any response or acknowledgement regarding the HR file issue meant that the applicant was deliberately refusing to provide any information about her HR file. Although this period of time included the recognised Christmas break, the letters of 14, 21 and 23 December had been sent at a time before the publicised time at which the offices of GP Legal would be closed for Christmas (from 5 pm Wednesday, 23 December 2015).

[66] Mr Gelonesi provided evidence that on 23 December “… we all went off for Christmas - for our Christmas party at about 11 o’clock that day and didn’t return.” 1 However, the letter from PCC Lawyers of 23 December was sent at 10:08 am by email to both the personal email address of Mr Gelonesi, and to the general office email address of GP Legal. Further, in respect to the letter of 21 December, Mr Gelonesi said that “… on 22 December I was involved in a guardianship Tribunal matter and didn’t return to my office that day.”2

[67] Although one may readily appreciate and sympathise with the time demands that might be placed upon busy solicitors, particularly in the week prior to Christmas, legal representatives acquire a very serious professional responsibility to take all reasonable steps to act in the interests of their clients. It is difficult to accept that such responsibility could be discharged when communications from other lawyers that were acknowledged to have been received on 14, 21 and 23 December 3, were simply not opened and read4, let alone responded to in even an elementary manner.

[68] Although it has subsequently emerged that at the time, the applicant was unaware of the directions regarding the HR file contained in the letters of 21 and 23 December, the employer had valid reason for the dismissal because it was reasonable for it to assume that the absence of any response to those letters, and the earlier letter of 14 December, represented a deliberate refusal to comply with the directions. In any event, even if there was some invalidity that could be established for the reason for dismissal as was within the knowledge of the employer as at 4 January, the subsequent actions of the applicant have confirmed valid reason for dismissal.

[69] The applicant has subsequently confirmed that she took her HR file on 3 December 2015. The applicant said she took the file for her protection because she feared that her personal HR file would be altered. It is conceivable that in circumstances where the applicant believed that action was being taken against her in an attempt to stymie or silence her complaint about improper or potentially illegal accounting malpractices, there could be justification for her removal of her HR file. However, once her complaints had been investigated and dealt with by senior managers of Conair Corporation, USA, there could be no justification for her retention of the employer’s property.

[70] The applicant was aware that she was taking a significant risk when she decided to take her HR file with her when she left the workplace on 3 December 2015. Any justification for that action could not be sustained after the employer had identified the absence of the HR file and sought its return. Further, at that point in time, circa 14 December 2015, the protection that she said she sought could have easily been achieved by photocopying the contents of the HR file and returning the original file to the employer. Instead, despite at least seven formal requests for the return of the HR file, it was not provided until shortly before the commencement of the first day of Hearing. Consequently, there is significant doubt about the veracity and motives of the applicant at the time at which she removed the file from Conair’s premises, and also whilst she retained the employer’s property up until shortly before the commencement of the Hearing.

[71] The legitimacy of the applicant’s motives in respect to her initial removal of the HR file and a subsequent retention of that material has been impugned by evidence that she gave about her motivation in respect to possession of the HR file. In this respect it is instructive to consider, in particular, the following evidence provided by the applicant. During cross-examination the applicant offered the following testimony:

“Why do you think I took my file? Because I was threatened with my job at that meeting. That’s why I took my file.” 5

[72] Despite the applicant clearly acknowledging that she took the file on 3 December because she felt that her job was under threat, she later sought to justify the taking of the HR file with the suggestion that it was commonplace for her to take documents home:

“On 3 December 2015 you took a HR file from Conair, didn’t you? --- I did.

Did you tell them of the time that you are taking a HR file? --- I didn’t.

At what time did you tell Conair that you had taken the HR file? --- I didn’t.

When did you first become aware that Conair had asked you where the HR file was? --- One of the letters - whatever letter was it?

When you - - -? --- I used to take other documents home all the - I used to work from home. No one ever asked me to report what documents I take. I was still an employee of Conair.

Did you ever tell anyone that you are taking documents home with you on these other occasions? --- It was a common fact, I used to work from home.” 6

[73] This evidence has not assisted the credibility of the applicant. The evidence confirms that the applicant knew that she was committing misconduct when she took the file on 3 December 2015. An attempt to subsequently suggest otherwise provided little assistance to support the applicant’s case.

[74] In summary therefore, there are a number of facets of the consideration as to valid reason for dismissal which can be appropriately assessed in respect to different points in time.

[75] Firstly, the actions of the applicant on 3 December 2015, when she took her HR file from Conair’s premises, was wilful misconduct that provided valid reason for summary dismissal. Only in the event that there was some subsequent vindication of that action could there be any prospect for defence of that misconduct.

[76] Secondly, at the time that the employer advised the applicant of dismissal, 4 January 2016, the refusal to acknowledge or respond to the employer’s repeated requests for the return or information about the HR file, represented misconduct (albeit including the contribution of her lawyers), that provided valid reason for summary dismissal.

[77] Thirdly, in the period following the termination of employment, in particular after the applicant had been advised that the investigation by Conair Corporation (USA) had been completed, while the applicant retained what she knew to be rightly the property of the employer, her action represented valid reason for summary dismissal.

[78] Consequently, there was valid reason for the dismissal of the applicant. The findings of wilful misconduct made by Conair have been verified.

387 (b) - Notification of reason for dismissal

[79] Conair provided written notification of the reason for the applicant's dismissal in the letter of dismissal. The applicant asserted that the employer had failed to give notice of the proposed ground of dismissal prior to the letter of dismissal of 4 January 2016. However, the letter from PCC Lawyers of 23 December 2015, stated unequivocally that if the applicant did not comply with the direction regarding her HR file, disciplinary action in the form of the summary termination of the applicant’s employment for wilful misconduct was likely.

387 (c) - Opportunity to respond to any reason related to capacity or conduct

[80] Conair, through its lawyers, provided the applicant, through her lawyers, with appropriate opportunities to respond as was clearly identified in the letters of 14, 21 and 23 December 2015. The fact that these opportunities were provided shortly before the Christmas period does not negate the fact that clear opportunities were provided. It was highly regrettable that there was not even an elementary acknowledgement or response provided when the opportunities to respond were given.

387 (d) - Unreasonable refusal to allow a support person to assist

[81] In this instance, there was evidence of the adoption of erroneous procedure which did not properly accommodate the applicant being given an opportunity to have a support person present to assist in the discussions that occurred on 3 December 2015. I reject the assertion that was made by Ms Carter, that the meeting of 3 December was not disciplinary in nature.

[82] On 3 December 2015, Ms Carter travelled from PCC Lawyers to Conair’s offices with an intention to place the applicant on paid special leave, this intention was confirmed after her brief conversation with Mr Howell shortly after her arrival. At this point, Ms Carter should have made arrangements for the applicant to be offered the presence of a support person. Some of the difficulties which subsequently emerged during and immediately following the meeting of 3 December 2015 may have been avoided or minimised if the applicant did not, justifiably, feel as if she had been ambushed.

387 (e) - Warning about unsatisfactory performance

[83] This factor is not relevant to the circumstances in this instance.

387 (f) - Size of enterprise likely to impact on procedures

[84] The size of the employer’s operation would not have been likely to have a significant impact on procedures surrounding the dismissal of the applicant.

387 (g) - Absence of management specialists or expertise likely to impact on procedures

[85] This factor is not relevant to the circumstances in this instance.

387 (h) - Other relevant matters

[86] The applicant’s outstanding work record, and the high regard that she was generally held in at Conair, has introduced an element of tragedy into the unfortunate chain of events that commenced with the applicant’s great mistake when she decided to take her HR file. An outstanding work record might operate to accommodate one single act of misguided misconduct, but the removal of the HR file, in the heat of the moment on 3 December, was followed by the continued unauthorised retention of the employer’s property up until just before the commencement of the first day of Hearing.

[87] There was one further matter of relevance to the summary nature of the applicant’s dismissal. The applicant introduced into evidence a document that contained the schedule of terms and conditions for her employment, and clause 7 of this document contains terms that deal with the termination of employment. Relevantly, clause 7 of the terms and conditions of employment document stated:

“In the event of the Company wishing to terminate your employment, four (4) weeks written notice must be provided…. Should the Company not require you to work out the notice period, payment in lieu shall be made.”

[88] There were no other terms in the schedule of terms and conditions of employment document which dealt with termination of employment without notice in cases of serious misconduct. Strictly speaking, it appeared that there was no contractual basis for the applicant to be dismissed without notice as occurred on 4 January 2016.

[89] Ms Carter was questioned about what might be described as a significant deficiency in the terms that were apparently contained in the schedule of terms and conditions of employment of the applicant. There was some evidence to suggest that Conair had taken steps in the past to rectify this deficiency, and employees had been required to execute new contract documents which contained different terms.

[90] In something of a twist of classic irony, at the time that the employer was dealing with the applicant’s dismissal, it was unable to verify whether the contractual terms of the employment may have prevented termination without notice because the applicant had taken those records as part of her HR file which she refused to return.

[91] In the particular circumstances of this case, although it appeared that Conair may have established a contractual obligation which relinquished its common law right to dismiss without notice in cases of serious misconduct, there was sufficient doubt about the legitimacy of the document to discard the prospect that the failure to pay notice in accordance with the contractual terms of the employment should be held to be unjust.

Conclusion

[92] The applicant was summarily dismissed for wilful misconduct involving the failure to comply with the employer’s direction to return its property or otherwise provide information about the whereabouts of that property. The employer was entitled to consider that the absence of any acknowledgement or response from the lawyers acting for the applicant constituted a refusal to comply with the direction regarding the return of its property.

[93] At the time of the dismissal the findings of wilful misconduct made by Conair have been confirmed by the Commission. Further, the misconduct of the applicant has been found to have occurred at the time that she took the employer’s property, 3 December 2015. In addition, the misconduct of the applicant persisted whilst she retained the employer’s property against numerous requests for its return.

[94] Consequently, the employer dismissed the applicant for valid reason relating to the applicant's misconduct. That nature of the misconduct represented wilful misconduct sufficient to justify summary dismissal.

[95] Certain procedural errors which have been identified in respect to, in particular, the meeting that the employer arranged with the applicant on 3 December 2015, have not operated so as to mitigate the wilful and persistent misconduct of the applicant.

[96] The dismissal of the applicant was not harsh, nor was it unjust, or unreasonable.

[97] Therefore, the application for unfair dismissal remedy must be dismissed, and an Order to that effect will be issued accordingly.

COMMISSIONER

Appearances:

Mr P E King of Counsel, instructed by Mr B Gelonesi, solicitor of GP Legal appeared for the applicant.

Ms K Jones of Counsel, instructed by Ms L Gleeson of PCC Lawyers, appeared for the employer.

Hearing details:

2016.

Sydney:

May, 30 & 31 and June, 16.

 1   Transcript @ PN921.

 2   Transcript @ PN928.

 3   Transcript @ PN943.

 4   Transcript @ PN944.

 5   Transcript @ PN495.

 6   Transcript @ PN803-PN808.

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