DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Christopher Ward
v
Reece Limited T/A Reece Group Pty Ltd
(U2018/5530)

Application for an unfair dismissal remedy - dismissal harsh, unjust and unreasonable - compensation ordered.

[1] On 29 May 2018 Christopher Ward (the applicant) filed an application for an unfair dismissal remedy in accordance with Part 3-2 of the Fair Work Act 2009 (the FW Act) in relation to his summary dismissal by Reece Australia Pty Ltd (the respondent) on 11 May 2018.

[2] The application was referred to me for determination and a hearing was conducted on 3 October 2018.

[3] The applicant was represented by B Clarke, solicitor and the respondent by A Perigo, of counsel.

[4] The reasons given by the respondent to the applicant for his dismissal were set out in a letter on 11 May 2018. The letter included the following:

‘…For the purposes of completeness, we restate the allegations against you:

1. You provoked and aggravated a Muslim customer and encouraged a female staff member to challenge him on his beliefs regarding women.

2. A customer of Indian descent offered to take a female staff member out for coffee if she lowered the price of goods for him. You advised her, she should have gone out for a coffee with the customer and questioned whether the female staff member didn’t go because of the customer’s skin colour.

3. You stated to the Muslim customer “You should hear what Gee (2IC) says behind your back”, insinuating that Gee had made inappropriate comments about the customer.

4. You demanded an employer’s personal phone multiple times, the employee said “No”, the demands continued which resulted in the employee handing their phone to you. You then demanded the employee unlock the phone, at which time without permission you deleted the employee’s Facebook app without consent.

5. You unreasonably threatened to terminate an employee’s employment within their probationary period if they sought to take a period of annual leave.

…

•  Your behaviours are contrary to the Reece R10 values (Do the right thing and Grow as a team)

•  Your behaviours are in direct breach of the Reece Performance Management & Disciplinary policy.

•  Your behaviours constituted workplace bullying and discrimination based on race.

As such it has been determined that your actions as the Branch Manager demonstrate a serious lack of leadership and behaviours that are not in line with Reece or community values. We consider that these behaviours amount to serious misconduct that warrant summary dismissal and as such the termination of your employment took effect immediately…’

The evidence

[5] The applicant and Ashley Dooling gave evidence on the applicant’s behalf.

[6] Evidence was given on behalf of the respondent by Peter Fluder (Senior People Adviser), William Rossiter (Region Leader), Patricia Valavanis (Retail Consultant), Gee Vural (Assistant Manager), Joshua Hornery (Branch Staff Member) and Anthony Harper (former employee).

[7] The applicant commenced employment with the respondent at the Lewisham store as a driver in June 2010. In or around late 2011 he was promoted to the position of Assistant Manager at the respondent’s Rockdale store. In or around February 2017 he was transferred to the respondent’s Alexandria store and then in July 2017 was promoted by David Willis, the then Region Leader, to Branch Manager at the Punchbowl store. In August 2017 William Rossiter became the Region Leader.

[8] Mr Fluder said, in response to a question from the bench, that branch managers were almost invariably appointed from within the respondent’s business. 1 The respondent has over 600 stores in Australia with around 5,200 employees.2

[9] In February 2018 the applicant dismissed Anthony Harper for poor performance. The applicant subsequently conducted meetings, both in a group and individually, to inform staff that ‘poor performance would not be tolerated’. The staff members spoke to included Mr Hornery, Mr Vural, and Ms Valavanis. 3

[10] In late April 2018 the applicant placed Mr Hornery on a performance improvement plan ‘after months of poor performance.’ 4

[11] According to the applicant, since being employed by the respondent (on 3 April 2018) Ms Valavanis had ‘displayed poor attitude towards the job.’ He had discussed the attitude expected of employees with her and conveyed his concerns to Mr Rossiter. 5

[12] In April 2010 Mr Rossiter told the applicant that Mr Vural had complained to him that the applicant had not supported him being promoted to Branch Manager. 6

[13] The applicant’s dismissal appears to have been triggered by a discussion on 30 April 2018 between Ms Valavanis and Mr Rossiter in which Ms Valavanis raised a number of concerns she had about the way the applicant had allegedly treated her. Ms Valavanis had at that point only been employed by the respondent for about four weeks. 7

[14] In her written statement Ms Valavanis said that since commencing her employment with the respondent she had been treated ‘inappropriately’ by the applicant. 8

[15] Ms Valavanis said that on 30 April 2018 she decided to contact Mr Rossiter to discuss her concerns with the applicant’s behaviour towards her. She told him about a number of incidents that she said had occurred since her employment had commenced and followed this up with an email setting out the details of the behaviour she said she had experienced. 9

[16] In her statement Ms Valavanis referred to three alleged incidents.

[17] The first incident concerned a middle-aged Muslim man who, according to Ms Valavanis, came into the store on or around 25 April 2018 to purchase some goods. Ms Valavanis, in her statement, described the incident in this way:

‘The customer was strongly offended by the female gymnasts that were on the television for the Commonwealth Games. The customer expressed his opinion, based on his religious views, that the gymnasts were dressing inappropriately and that this was against his religion.

In response to the customer’s comments, Chris provoked the customer by making a joke about his opinion and said something like ‘oh mate, it’s just girls’. The customer became angry, not towards me, but because his opinions were not being acknowledged by Chris.

The customer continued to make comments directed towards me such as “women shouldn’t be working here.” I tried to remain calm and said to the customer “I appreciate your opinion but I think we should just focus on your order.” Chris then intervened and said to me in front of the customer that I should be defending myself. This only aggravated the customer as he felt he was not in the wrong about the comments he had made.

I tried to defuse the situation and said something like “everyone is entitled to their own opinions.’ At some stage during this interaction, I decided to turn the television off, again in an attempt to defuse the situation. The customer then left the store.

After the customer left the store, Chris approached me and told me I should have been offended by the customer’s comments. He asked me why I didn’t say anything. I said I didn’t think it was worth losing a customer over an opinion.’ 10

[18] Ms Valavanis went on in her statement to proffer her opinion about the incident:

‘I believed that Chris escalated the situation by provoking the customer and this was not the correct approach. I believed his behaviour was contrary to the Reece values and the seven service standards and I felt this was most certainly discriminatory behaviour. I felt that Chris was very unempathetic towards the man’s beliefs and provoked the situation even further. He could have handled the customer in a far more respectful manner. I felt very uncomfortable about Chris’ approach on that occasion’. 11

[19] During her cross-examination Ms Valavanis denied being taken aback and shocked by the customer’s comments.

‘Everyone’s entitled to their own opinion, so I focused on doing my job.

So you weren’t at all concerned? ---Not at all.

Not even when the customer pointed at you and said, “All women should be at home in the kitchen”? --- Not at all. As I’ve said, in my statement, that I remained as calm as possible. I tried to, obviously, keep focused on the task at hand, which was the order at the time, and I kept drawing the attention back to the actual order that we were focusing on.

Did you think that the customer’s comments were offensive, in a discriminatory way? ---Offensive to myself?

Offensive? Was he – yes, to yourself? ---I don’t take things personally. The job’s the job, everyone is entitled to their own opinion.

…

Then Mr Ward came over and made – tried to make a joke and made the customer cranky, is that right? ---That’s correct. During this interaction between the customer and placing the order, the customer obviously was talking about his views, and Chris was coming in and out of the conversation and making some statements, which obviously didn’t make matters any better.’ 12

[20] Ms Valavanis said she thought the applicant was discriminating against the customer:

‘Well, yes, because he wasn’t listening to what the customer’s needs were and that, at the time, was his feelings towards the actual Commonwealth Games being on.

So the customer wasn’t discriminating against women, but Chris was discriminating against the customer by saying “You can’t say that here, it’s only the Commonwealth Games”, or whatever else he said. Is that what you say? ---Well, the customer is entitled to their beliefs and opinions and it is up to us to respect our customers. We’re there to give them the best experience possible.’ 13

[21] In his statement the applicant said that:

‘In early April 2018, whilst the Commonwealth Games were on, Fadi – a Muslim customer who was a regular customer of the store – entered our store later in the day. We had the women’s gymnastics playing on the store T.V. In addition to myself, Mr Vural, Ms Valavanis and Mr Hornery were present and preparing to close the store.

Fadi immediately started yelling aggressively and pointing his finger at the T. V. He began yelling words to the effect of ‘This is fucking pornography, turn this shit off,’ ‘These women should be wearing Burkas’ and ‘These women look like prostitutes’.

Fadi then said, while looking at Ms Valavanis – “All women should be at home in the kitchen.”

He then turned to Mr Vural, who was serving a customer at the time, ‘C’mon Gee, you’re Muslim, turn this porn off.’

I had initially thought Fadi was joking, but his voice was now raised and he was getting angrier. I could see that Ms Valavanis and Mr Hornery were uncomfortable and clearly in shock and I felt as branch manager, I had to step in. I approached Fadi and a conversation followed where words to the following effect were spoken:

I said: calm down mate, it’s just the Commonwealth Games. Please leave your religious opinions at the door.

Fadi stopped yelling and immediately apologised. He said, ‘Sorry man, I’m a good guy, I didn’t mean any offence.’ Fadi then turned to Mr Vural and said ‘Gee knows I’m a good guy, I’ve known Gee for years’. I responded in an extremely satirical and jovial tone and said: ‘That’s not what he says about you!’ Fadi laughed and said: “Gee wouldn’t say anything about me, he’s a good bloke.’

Fadi then left the store and I approached Ms Valavanis and Mr Hornery, who were clearly shaken by the incident and asked if they were OK. Ms Valavanis said words to the effect of: ‘That was so offensive, he was getting so angry’.

After Mr Vural had finished serving a customer, I approached him and I apologised to him if I had put him in an awkward situation. He responded with words to the effect of: ‘It’s all good man.’

I never aggravated or provoked Fadi, nor did I ever encourage anyone to challenge him – or any customer for that matter.’ 14

[22] The applicant added the following in his statement in reply:

‘The middle-aged Muslim customer (Allegation 1) is well known to me, and indeed to Mr Vural….I do not recall Patricia engaging with the customer or making any reply to him, indeed both she and Mr Hornery appeared intimidated. His comments were certainly derogatory and sexist towards all women, including Patricia. He was very loud and aggressive, and I was concerned about the effect on staff and other customers, if he continued on.

As the customer is well known to me I tried to defuse the situation with my remarks, and as I expected the customer did calm down.’ 15

[23] During his cross-examination the applicant reiterated the evidence he gave in his statement. In particular he said that Ms Valavanis said nothing at all during the incident with the Muslim customer. 16 He also denied telling Ms Valavanis that she should be defending herself.17

[24] The applicant agreed that he said to the customer words to the effect of ‘You should hear what Gee says about you behind your back.’ though he added that he did so ‘[i]n a very jovial tone’. He also said that he noticed that when he said this ‘Gee had a bit of a shocked look on his face.’ 18 He added a little later:

‘Well I’d noticed that Gee was a little bit shocked that I had made that comment and maybe he thought that he felt like he’d lost a bit of face with that comment and I noticed that straightaway and I said, “Sorry, man, I didn’t mean it, you know, I was just trying to de-escalate the situation.” 19

[25] Mr Vural described the incident thus:

‘On or around 25 April 2018, a middle aged man of Arab descent entered the store and approached the trade counter.

I know this customer. I’ve forgotten who he works for, but I know him and have dealt with him many times. This is a customer who generally has a laugh and makes a few jokes. He has the look of a religious man, but he is a normal guy and a colourful character.

The customer made his order with Patricia and was watching the television screen behind the counter – the Commonwealth Games were playing. From what I could see, it looked as if he was having a normal chat with staff. Chris was present at the counter at this time.

I was behind the counter packing an order and heard a comment made by the customer which was about women. He said it was disrespectful and shameful that the women participating in the Commonwealth Games were wearing exposing clothing and they should have more respect for themselves. The customer was expressing his views in a firm manner. It appeared he was trying to encourage others to debate with him about his views.

At this stage, I walked away from the counter. I understand that the conversation continued between the counter staff, including Chris, and the customer in my absence.

When I returned to the counter, I was taken by surprise when I heard Chris make a comment to the customer which was similar to “you should see what Gee says about you behind your back.” The customer then looked at me in a serious way.

I was not sure what Chris was trying to infer from this comment. I responded by saying “I don’t know what you’re talking about”. The customer then smiled and winked at me and said, “I don’t believe Chris. I know you are a good bloke, Gee.”

Despite the customer’s good natured response, I felt embarrassed and uncomfortable that Chris put me in that situation with a customer.

After the customer left the store, Chris approached me and commented that the customer was getting worked up. He said that the customer was furious and angry and that no one had agreed with his opinions during the discussion about women’s appearance in the Commonwealth Games.

I spoke to Chris about the fact that he made a comment about me, even though he knew the customer was worked up. I told Chris not to put me in a situation like that again, as I do not want a complaint against Reece because he has “revved up” a customer.’ 20

[26] During his cross-examination Mr Vural said the applicant and the customer were ‘just having a bit of a joke or debate….I don’t really know if there was any seriousness to it.’ 21

[27] In her statement Ms Valavanis referred to another incident which she said occurred on or around Friday 27 April 2018. She described the incident this way:

‘I was serving an elderly Indian man who was asking about our prices. I explained to him that our prices were based off a competitive market price and we do not provide discounts, explaining the Reece quality guarantee.

The customer then said “maybe if I take you out for a coffee that will put the prices down.” I simply responded “thank you for your offer, it’s very nice of you but I’m not interested.” We had a laugh about it.

After the customer left, I went back over to the trade side with a smile on my face as the interaction had lightened up my day. Chris asked me about what happened and I said “oh the man was just having a look.” Chris then said “I heard something about taking you for coffee.” I giggled and said “yeah the old man jokingly asked me out for a coffee.” Chris then said “why didn’t you say yes? Was it because of his skin colour?” This was not said in a joking way, Chris was being serious when he made this comment.

I was shocked by this question and responded “what does that have to do with this?” Chris said “well that’s why you said no it’s because he’s Indian, that’s just racist.” I responded “I don’t understand why you would say that, my response to the man had nothing to do with his skin colour.”

The conversation came to an end at that point with Chris “shhing” me as another customer walked in. I felt quite saddened by this conversation with Chris as I was portrayed as racist and that it was unnecessary for that small situation to be escalated into something that it wasn’t. I was quite upset afterwards.’ 22

[28] During her cross-examination Ms Valavanis said that it was the applicant who was being racist in saying that she did not go for coffee with the customer because of his skin colour. 23

[29] During his cross-examination the applicant said that he was on the trade counter while Ms Valavanis was talking to the customer in the showroom. From where he was he was unable to see into the showroom. 24 He said he could not hear the conversation with the customer.25 He only learned about the conversation because Ms Valavanis told him about it afterwards.26 He completely rejected Ms Valavanis’s version of their discussion – calling it a ‘lie’.27

[30] In response to a question from the Bench the applicant explained why he thought Ms Valavanis may have fabricated the story. He said that he realised soon after employing Ms Valavanis that he had made ‘a very big mistake’.

‘Her attitude was very questionable, she really had an attitude that she didn’t care for the job. She spoke back to me on a number of occasions when I asked her to do tasks, and very quickly our relationship [deteriorated] …’ 28

[31] The final incident referred to by Ms Valavanis in her statement was included under the heading ‘Allegation 5 – Threat to Employment’. Ms Valavanis described it thus:

‘On Wednesday 25 April 2018, I had a conversation with Chris about taking an annual leave day that Saturday as I had a wedding that day that I had forgotten about. Chris reminded me that I had only been here for a month and it wouldn’t look good on me to take a day off. He also said that as a showroom consultant if I was not there it would reflect badly on me. He told me that we would talk about it the following day.

The following day I was nervous about speaking to Chris because I thought I might get fired. When I approached Chris the following day, he hesitantly agreed that I could take the day off. Chris reminded me that I was still on a probationary period and that everything I did would ultimately reflect on the final decision about my ongoing employment.

I was concerned about Chris’ comments so I said that I wouldn’t take the day off but asked if it was alright if I was running a bit late for work that day. Chris agreed to this. He seemed to be more happy with me having to reorganize my plans than to take the day off.’ 29

[32] The applicant in his statement gave a rather different version of these events, which he said occurred on Thursday 26 April 2018. He said that Ms Valavanis approached him late that afternoon and words to the following effect were exchanged:

‘Ms Valavanis said: I forgot to tell you, I need to take next Saturday 4 May off, I forgot that I have a wedding on.

I said: This is late notice. You needed to give me at least two weeks’ notice. You need to give 4 weeks’ notice as per your contract. Let’s discuss this in the morning.’

The next day we continued the discussion and I told Ms Valavanis she could have that Saturday off, but explained the need for giving adequate notice to take leave in the future. Ms Valavanis responded by apologising, and told me that she had re-arranged the day, so she would only need an hour or so off work.

I never threatened to terminate her employment based on her leave request, or any future leave, within her probationary period.’ 30

[33] In his statement in reply the applicant said:

‘…I was annoyed and surprised when Patricia asked for the next Saturday off because she had ‘forgot’ a wedding, as sales staff are required to give 4 weeks’ notice of requests to not work on a Saturday. When sales staff are down on a Saturday the counter staff have to relieve them, which normally leads to delays and informal complaints and comments from customers, who have to wait longer to complete purchases and receive deliveries. (Of course, in an emergency or crisis we all have to work harder and accept that we are short, but Patricia’s request was not of this nature.) In view of Patricia’s other issues I considered it worth giving her a reality check on her responsibilities to Reece and her co-workers. I believe that my comments were directed at her improving as a new sales consultant and Patricia did not appear upset or threatened at the time….’ 31

[34] During his cross-examination the applicant denied saying that it would reflect badly on Ms Valavanis if she took a day off. 32 When asked if he reminded her she was still on probation he said:

‘I reminded her the fact that she had had two previous instances where she had left the store abruptly and this was the third instance where she was taking time off with only a weeks’ notice and I just gave her a bit of a reality check as to where she stood within the company.’ 33

[35] While the applicant agreed to let Ms Valavanis have the day off he told her ‘for future reference’ she had to give him ‘a bit of notice.’ 34

[36] During her cross-examination Ms Valavanis agreed that she was supposed to give more than a week’s notice before she could take leave. 35 She said that she received the invitation to the wedding on the Monday, but forgot to tell the applicant until the Wednesday.36 She agreed that Saturday was usually a busy day in the showroom.37 In the event she was able to go for the wedding, which did not actually take place until after the store had closed.38

[37] Mr Hornery said in his statement that:

‘In late January 2018, I was approached by my manager, Chris Ward, about 15 minutes before the branch closed for the day. We were doing the daily banking at the time. Chris demanded that I hand over my personal mobile phone as he believed that I was using the Facebook app late at night. This was the first time we had a conversation about my mobile phone and Facebook usage.

Chris said he was going to delete the Facebook app off my phone. He said he did not want me to use the Facebook app for one week. He was very persistent and asked me several times to provide my phone. At first, I thought Chris was joking.

Chris continued to persist and demanded I hand over the phone a number of times. I responded “no” multiple times. I said “I’m not giving you my phone.” I asked Chris “why do you need my phone?” Chris continued to ask me and I eventually gave in and handed him my phone. I did this because of continued pressure from my manager. I felt weak about this situation because I knew I couldn’t do anything about it. I felt that if I stood up to him I would be singled out even further and potentially lose my job. I really enjoy working for Reece so I felt I had to put up with it and agree to his demands.

Once Chris had the phone he asked me to enter my pin code to unlock the phone. He asks me repeatedly to give him my pin code. I replied “no” multiple times. I then unlocked the phone as requested. Chris then accessed my phone and deleted my Facebook app. Chris then awkwardly handed me back my phone.’ 39

[38] During his cross-examination, Mr Hornery agreed that he had been to the applicant’s apartment and played his guitar. 40 He also agreed that he would often stay back after work and talk to the applicant about a wide range of matters, both professional and personal, and that he looked up to the applicant for quite a while.41 He agreed that the applicant said after he had deleted the app that his life would be a whole lot better without Facebook.42

[39] Mr Harper in his statement gave a very similar version of these events. He noted that when the applicant gave the phone back to Mr Hornery he said: “your life will be a whole lot better without Facebook.” 43

[40] In his statement the applicant said the following:

‘In January 2018, I was on holidays overseas. I kept noticing that Mr Hornery was online on Facebook at 2-4am on weekdays. Mr Hornery had been coming into work extremely tired and I was concerned about his wellbeing. I had been recording similar issues with Mr Hornery as talent statements in the Respondent’s Workday program, and through informal closed-door discussions. I had been mentoring Mr Hornery for the past 6 months and considered him to be a friend. When I returned from holiday in late January, I approached Mr Hornery with what I had seen in relation to his Facebook usage and had a chat about it. I explained my concern and suggested he delete his Facebook app for a week to try and get some sleep. He admitted that it was affecting his sleep and would give it a go.

Later in the day I asked if Mr Hornery had deleted the app. He responded with words to the effect of: ‘I don’t want to lose my Facebook page.’ I explained that he could just delete the app and reinstall it whenever he wants, and it won’t delete his page. I then offered to show him how to do it. He then handed me his unlocked phone, and I proceeded to show him how to uninstall the app.

Never once did I demand or bully Mr Hornery into deleting the app and we continued to have a good relationship until I was dismissed.’ 44

[41] In his statement in reply the applicant said:

‘In January 2018 everyone was concerned about Josh – he was always tired; his morale and energy levels were low and performance again slipping. As recounted by Mr Vural I was concerned that he was on Facebook at all hours and decided to try to help him by reducing his Facebook usage. I did approach Josh and during our conversation I deleted the App off his phone. At the time I truly believed that Josh agreed to me doing this as he was not upset or disturbed at my suggestion or actions, which he could and did easily reverse.

…I did not intend to upset or bully or harass Josh, my intention was to offer help, indeed I was trying to mentor him... However I can see that I should have taken more time and worked my way around to the Facebook topic, instead of rushing in too quickly. I am sorry for the effect of my actions had on Josh but after this incident we continued to talk as before – at least until mid-April when he made 2 serious customer errors which left me no choice but to issue him a final warning and place him on a performance management program. I am sorry that Josh took my actions badly, and had I known of this would have told him so and tried to remedy the situation.’ 45

[42] During his cross-examination the applicant said that he thought he and Mr Hornery were friends. 46

[43] The applicant denied that he demanded Mr Hornery’s phone. He added however:

‘Look, in hindsight, over this situation, I would like to apologise to Josh for my actions. I should not have deleted the app off his phone. But I felt, at the time, that we had a good enough relationship for me to do that. I never bullied or badgered him.’ 47

[44] The applicant, in repeating his denial that he ‘demanded’ the phone from Mr Hornery added:

‘This was a very jovial situation, at the end of the day, and I was saying, “Come on mate, just give me your phone, I’ll just show you how to do it, come on mate.”’ 48

[45] The applicant said he was unaware of how Mr Hornery felt about him:

‘I believed, the whole time that I worked with Josh, that we were good work mates. We used to stay back together, for hours sometimes and talk. People used to comment that he would hang around me like a lost dog.’ 49

[46] The applicant said in his cross-examination:

‘I feel like I was in a mentor role with Josh. He had spoken to me previously that he didn’t have a male role model in his life and he asked me if I could be that. So I believed, and whether or not inappropriate for a manager, I believed that our relationship had extended past manager and employee.’ 50

[47] Mr Rossiter said in his statement that after having the conversation with Ms Valavanis in which she raised her concerns about the applicant he contacted Mr Vural. According to his statement ‘Gee confirmed that he witnessed the incidents and also raised a number of concerns about Chris’ leadership and management more generally.’ 51 Following a discussion with Mr Fluder he asked Mr Vural and Ms Valavanis to provide written statements about the alleged incidents.52 Having received the statements he decided with Mr Fluder to conduct an investigation and then meet with the applicant ‘to put the allegations to him and give him an opportunity to respond’.53

[48] According to his statement, Mr Rossiter notified the applicant of the allegations against him on 8 May 2018 and asked him to attend a meeting the following morning to discuss the allegations. He was told he could bring a support person from outside the branch or the business. 54

[49] The meeting occurred on 9 May 2018 where the five allegations were put to him. According to Mr Rossiter’s statement the applicant told the customer in the first allegation not to bring religion into the store and denied telling Ms Valavanis to defend herself. In relation to the second allegation the applicant denied making any reference to the customer’s skin colour. In relation to the third allegation, the applicant admitted to the alleged comment and that he had apologised to Mr Vural. In relation to the fourth allegation the applicant admitted that he had taken the phone and deleted the Facebook app but said that Mr Hornery had not shown any resistance to providing his phone to the applicant. In relation to the fifth allegation the applicant denied threatening Ms Valavanis’s job. 55

[50] According to Mr Rossiter’s statement:

‘Chris said that he felt like there was a witch hunt against him. He referred to a conversation with Gee prior to ANZAC Day in which Gee indicated he wanted to take the rest of the week after ANZAC Day off within only 24 hours’ notice. When Chris indicated he was not pleased that Gee had not provided sufficient notice Gee said “have a good weekend” and hung up the phone.’ 56

[51] According to Mr Rossiter, after a break, Mr Fluder asked the applicant if there was anything further he would like to add. The applicant indicated that ‘he was shocked by the allegations against him and was taken aback. He said he was in a difficult situation and that all of the people involved in the allegations had something against him. He apologised if some people felt his actions were offensive.’ 57

[52] The applicant was then suspended with pay and asked to return for a meeting the following day ‘to show cause as to why his employment with Reece should not be terminated.’ 58

[53] During the ‘show cause’ meeting the applicant (who was accompanied by Mr Dooling as his support person) read from a statement (which was included in the applicant’s written evidence). In this statement the applicant emphasised that he had worked for the respondent for nearly eight years, had worked his way up and made many sacrifices for the respondent. He said that he had never had any disciplinary action taken against him and had never received any verbal or written warnings. He said that he may have acted inappropriately in relation to the Facebook app (even if he was well-intentioned) but that he was not guilty of serious or gross misconduct or of bullying. 59

[54] Mr Fluder said in his statement that:

‘Chris’ demeanour during the meeting was aggressive. At no stage did Chris take any responsibility for his conduct and the impact that may have had on other staff members. We took this into account when determining the appropriate level of disciplinary action. If Chris had taken responsibility for his conduct and/or demonstrated remorse, the decision about the dismissal may have been different. However, we could not keep a branch manager without any level of self-awareness, understanding of his conduct or ability to accept feedback in the business, let alone managing one of our branches.’ 60

[55] Mr Fluder sent the applicant the letter of dismissal on 11 May 2018.

Consideration

[56] In considering whether I am satisfied that a dismissal is harsh unjust or unreasonable I must take into account the criteria set out in s.387 of the FW Act. These 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.

I will consider each of these criteria in turn.

[57] I first turn to whether the respondent had a valid reason for the applicant’s dismissal based on his capacity or conduct (s387(a)).

[58] Mr Fluder told the Commission that the applicant’s conduct justified summary dismissal because of ‘a pattern of behaviour’. 61 When asked what the pattern was he answered:

‘Well, the pattern is bullying….[t]he pattern is there is an element of racism in there and the pattern is that he is abusing his power and coupled with the fact that the employees that were subjected to this were displaying high stress, high anxiety and from a company point of view we have a duty of care…This was a tough situation for them and I have no doubt the behaviour he displayed with Patricia, with Josh and to a large extent Gee too had an impact on these staffs’ emotional well-being … coupled with the fact that throughout the investigation there was no signs of care for the employees, there was no apology, didn’t take any responsibility. To the contrary, I would go as far as to say there is an element of narcissism there….’ 62

[59] The respondent based its finding of a pattern of unacceptable behaviour involving an element of racism and abuse of power on the five allegations made against the applicant referred to in the letter of dismissal. Three out of these five were based on allegations made by Ms Valavanis. None of these were corroborated in any significant way by independent witnesses.

[60] I have had the opportunity to observe both the applicant and Ms Valavanis give their evidence before the Commission. When compared with the applicant I found Ms Valavanis an unsatisfactory witness, and where her version of events conflicts with that of the applicant I generally prefer that of the latter. The applicant struck me as quite genuine and determined to answer truthfully, including apologising for some of his behaviour towards Mr Hornery and Mr Vural. By contrast I found much of Ms Valavanis’s evidence to be self-serving and implausible. However I am less concerned about the factual details which she claims to have recalled than the ‘gloss’ or characterisation she has applied to them – and which appear to have been almost completely accepted by the respondent.

[61] Taking the last allegation first as a good illustration. Ms Valavanis asked at very short notice to have the following Saturday off work – because she had forgotten about a wedding to which she had been invited. There is no doubt that the applicant was – quite reasonably - annoyed about this. He did not give her an answer straight away – and I am satisfied that he pointed out to her words to the effect that it was not ‘a good look’ for an employee who had been employed at that point for about three weeks. Again I hardly consider that to be unreasonable. Nevertheless, the next day the applicant agreed that Ms Valavanis could have the day off. Ms Valavanis claimed that she was worried overnight that she was going to be sacked. Maybe she was – but even she did not claim that the applicant ever actually told her he was going to sack her. Nor do I believe that any words he used could be reasonably seen as implying such a threat. The most Ms Valavanis claimed was that the applicant told her that as a showroom consultant if she was not there it would reflect badly on her, and reminded her she was still on probation. Yet somehow these words become blown up into a threat to sack her. For reasons that I fail to understand the respondent accepted this allegation by Ms Valavanis. I cannot. I find the fifth allegation to be simply untrue.

[62] The first allegation is equally puzzling. Ms Valavanis described the applicant’s conduct towards the customer known as Fadi as ‘discriminatory’ because he challenged the customer’s comments, inter alia that women (including presumably Ms Valavanis) should not work and should stay in the kitchen. Mr Fluder even suggested to the Commission that the applicant’s conduct was racist 63 though he eventually backed down from this. Based on the evidence I am satisfied that the customer known as Fadi made some extremely offensive and inflammatory remarks about women but that the applicant intervened to calm the situation down. It is frankly absurd to suggest that his conduct towards the customer was provocative, discriminatory or racist in any way. The only person making provocative or discriminatory remarks was the customer. I find this allegation to be totally unfounded.

[63] With regard to the second allegation, concerning the reason Ms Valavanis had refused to have a coffee with the elderly Indian customer, for the reasons given above I do not consider Ms Valavanis to be a reliable witness and I do not accept Ms Valavanis’s version of events. I might add that even if the applicant had said the words attributed to him by Ms Valavanis (which I do not accept) they would hardly have amounted to racism on his part. Rather they would have been (an admittedly poor taste but light-hearted) attribution of racism to Ms Valavanis.

[64] The third and fourth allegations are in a different category. Neither is based on Ms Valavanis’s testimony and it is clear that both incidents referred to in the allegations occurred.

[65] I am satisfied that in dealing with the customer known as Fadi the applicant said to him words to the effect of ‘you should hear what Gee says about you behind your back.’ This was clearly meant in a light-hearted manner and was part of the applicant’s attempt to calm the situation down. However, not unsurprisingly Mr Vural was upset by the applicant’s remark, which was inappropriate – though not serious enough to amount to misconduct. The applicant apologised to Mr Vural as soon as he realised he had upset him.

[66] Nor is there any doubt that the incident involving Mr Hornery and his phone occurred. I am satisfied that the applicant pressured Mr Hornery to hand over his phone to allow him to delete his Facebook app. I am satisfied the applicant was well-motivated and his conduct was consistent with his own view of himself as Mr Hornery’s friend and mentor. However it is equally clear that Mr Hornery did not see the matter in this way. I accept that the applicant’s behaviour on this occasion amounted to misconduct (though certainly not serious misconduct).

[67] In summary, therefore I find that three of the allegations (those involving Ms Valavanis) not to be true. In relation to the two events involving Mr Vural and Mr Hornery I consider that the applicant’s actions were inappropriate – though not serious enough to constitute either separately or together a valid reason for the applicant’s dismissal.

[68] I am satisfied that the applicant knew the allegations against him that led to his dismissal (s.387(b)). I am also satisfied that he had an opportunity to respond to those allegations (s.387(c)). I am satisfied there was no unreasonable refusal to have a support person (s.387(d)).

[69] The applicant was dismissed for serious misconduct – not poor performance – and therefore s.387(e) is not relevant.

[70] The respondent is a large employer with specialist human resources expertise. That makes the way it has handled this matter all the more disappointing (s387 (f) and (g)).

[71] I consider that the applicant’s relatively lengthy service with the respondent is a factor that weighs against the fairness of his dismissal. I do not consider there are any other relevant factors (s.387(f)).

[72] Having regard to all the factors I consider the applicant’s dismissal by the respondent to be harsh, unjust and unreasonable. While some of the applicant’s behaviour may have been inappropriate he was certainly not guilty of anything amounting to serious misconduct. None of his behaviour was racist or bullying, as claimed by the respondent. Rather I consider that the applicant was struggling to manage the team of employees reporting to him. In particular I think he was having difficulty distinguishing between the role of a friend and that of a manager. This should have been seen by the respondent as a performance issue, with the applicant given more support to improve his leadership skills.

Remedy

[73] The applicant does not wish to be reinstated 64 and I am satisfied that reinstatement would be inappropriate. The applicant remained unemployed at the time of the hearing. There was not a great deal of information about his attempts to mitigate his loss though his contract appears to limit the scope for him to seek employment in the plumbing industry. His dismissal also appears to have adversely affected his health.65 I am satisfied that an order for the payment of compensation to the applicant in lieu of reinstatement is appropriate in all the circumstances.

Section 392 of the FW Act provides as follows:

‘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.

[74] A recent Full Bench stated:⁶⁶

‘[16] The well-established approach to the assessment of compensation under s.392 of the FW Act, taking into account the matters specified in s.392(2), is to apply the “Sprigg formula” derived from the Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul Licensed Festival Supermarket.  This approach was articulated in the context of the FW Act in Bowden v Ottrey Homes Cobram and District Retirement Villages. Under that approach, the first step to be taken in assessing compensation is to consider s.392(2)(c) - that is, to determine what the applicant would have received, or would have been likely to receive, if the person had not been dismissed. In Bowden this was described in the following way:

“[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’...”

[17] The identification of this starting point amount “necessarily involves assessments as to future events that will often be problematic”. Once this first step has been undertaken, various adjustments are made in accordance with s.392 and the formula for matters including monies earned since dismissal, contingencies, any reduction on account of the employee’s misconduct and the application of the cap of six months’ pay. This approach is however subject to the overarching requirement to ensure that the level of compensation is in an amount that is considered appropriate having regard to all the circumstances of the case.’ (references deleted)

[75] In this case, the applicant had around eight years’ service with the respondent at the time of his dismissal. He had worked his way up from driver to store manager. He had never received any warnings in relation to his performance or conduct. I accept that he was having some difficulties in performing his managerial role but in the circumstances I would determine his anticipated period of employment as one year.

[76] The applicant earned $75,000 per annum plus superannuation. The starting point is therefore $75,000 (pus superannuation).

[77] Remuneration earned from the date of dismissal to the date of any compensation order is required to be taken into account under s.392(2)(e). Remuneration reasonably likely to be earned from the date of any compensation order to the date the compensation is paid is to be taken into account under s.392(2)(f). Any remuneration likely to be earned after that date to the end of the period of anticipated employment determined for the purpose of s.392(2)(c) is a relevant amount to be taken into account under s.392(2)(g) in accordance with the Sprigg formula.

[78] The applicant has received no earnings since his dismissal. Given his circumstances, I consider it unlikely that he will be able to obtain much work prior to the end of the period of anticipated period of employment. I do consider however that the figure of $75,000 should be discounted by 20% for contingencies making it $60,000.

[79] The applicant’s length of service would support the award of a higher than average amount of compensation.

[80] An order for compensation would not affect the viability of the respondent’s enterprise.

[81] The respondent made no submissions that any adjustment should be made because of the applicant’s efforts to mitigate his loss, and I do not propose to do so.

[82] The applicant did not receive any payment in lieu of notice.

[83] The compensation cap is $37,500 (the applicant’s annual salary divided by two).

[84] I consider that I should make a small discount to the amount of compensation payable because of the applicant’s misconduct in relation to the incident involving Mr Hornery. I do not consider there are any other circumstances to which I should have regard. I have not included any amount for shock, distress etc.

[85] I conclude that the respondent should pay the amount of $32,000 plus superannuation as compensation to the applicant. I do not see any reason for this amount to be paid in instalments. An order to this effect will be issue separately.

SENIOR DEPUTY PRESIDENT

Appearances:

B Clarke, solicitor, for the applicant.

A Perigo, Counsel, for the respondent.

Hearing details:

Sydney:

3 October

2018.

Printed by authority of the Commonwealth Government Printer

<PR701610>

 1   PN1075

 2   PN1076

 3   Exhibit 2 at [9]

 4   Ibid at [10]

 5   Ibid at [11]

 6   Ibid at [13]

 7   Exhibit 14 at [3]

 8   Exhibit 10 at [3]

 9   Ibid at [5]-[6]

 10   Ibid at [9]-[13]

 11   Ibid at [14]

 12   PN738-745

 13   PN746-7

 14   Exhibit 2 at [30] – [38]

 15   Exhibit 1 at [12]-[13]

 16   PN259

 17   PN261

 18   PN278

 19   PN290

 20   Exhibit 12 at [8] – [17]

 21   PN1011

 22   Exhibit 10 at [15] – [20]

 23   PN790

 24   PN318

 25   PN320

 26   PN326

 27   PN331

 28   PN336

 29   Exhibit 10 at [21] – [23]

 30   Exhibit 2 at [44] – [46]

 31   Exhibit 1 at [11]

 32   PN455

 33   PN457

 34   PN465

 35   PN693

 36   PN700

 37   PN702

 38   PN810-812

 39   Exhibit 11 at [8] – [11]

 40   PN891-892

 41   PN893-899

 42   PN916

 43   Exhibit 9 at [8]

 44   Exhibit 2 at [41] – [43]

 45   Exhibit 1 at [8] – [9]

 46   PN372

 47   PN389

 48   PN398

 49   PN400

 50   PN431

 51   Exhibit 14 at [4]

 52   Exhibit 14 at [5]

 53   Exhibit 14 at [8]

 54   Exhibit 14 at [15] – [16]

 55   Exhibit 14 at [18]

 56   Exhibit 14 at [19]

 57   Exhibit 14 at [21]

 58   Exhibit 14 at [22]

 59   Exhibit 2, appendix A

 60   Exhibit 13 at [25]

 61   PN1087

 62   PN1088-89

 63   PN1128

 64   PN1431

 65   Exhibit 2 at [57]-[58]

66 Double N Equipment Hire Pty Ltd t/a A1 Distributions v Alan Humphries [2016] FWCFB 7206