| [2019] FWC 1454 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Aaron Duncan
v
Peter Kingsley Plumbing Pty Ltd ABN: 37 154 688 963
(U2018/10023)
COMMISSIONER CAMBRIDGE |
SYDNEY, 9 MAY 2019 |
Unfair dismissal - no valid reason for dismissal - applicant advised of dismissal during telephone conversation - dismissal harsh, unjust and unreasonable - compensation Ordered.
[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 27 September 2018. The application was made by Aaron Robert Duncan (the applicant) and it named the respondent employer as Peter Kingsley Plumbing Pty Ltd ABN: 37 154 688 963 (the employer).
[2] The application indicated that the date of effect of the applicant’s dismissal was 7 September 2018. Consequently, the application was, prima facie, made within the 21 day time limit prescribed by subsection 394 (2) of the Act.
[3] On 7 October 2018, the employer filed a Form F3 - Employer Response to Unfair Dismissal Application. The Form F3 indicated that the employer raised a jurisdictional objection on the basis that the application had been made out of time as it was asserted that the dismissal of the applicant occurred on 10 August 2018, being “The day Aaron Duncan lost his license 10/08/2018.”
[4] On 8 October 2018, a letter was sent to the employer on behalf of the Fair Work Commission (the Commission) which inter alia, inquired as to whether the employer did not intend to participate in conciliation that had been scheduled for 24 October 2018. Subsequently, the conciliation proceedings were cancelled.
[5] On 22 November 2018, Dean DP sent a letter to the applicant which asserted inter alia, that the application appeared to have been made 27 days beyond the 21 day time limit. Further, this letter required that the applicant provide documentary material upon which exceptional circumstances could be established in order to permit the matter to proceed over the out of time objection raised by the employer.
[6] On 26 November 2018, the applicant sent a documentary response to Dean DP and provided supporting evidentiary material which, in summary, supported the assertion that his dismissal occurred on 7 September 2018, and not 10 August 2018, as had been asserted by the employer. On 6 December 2018, the application was referred to the Commission as currently constituted to determine the effective date of the applicant’s dismissal and, if necessary, to hear the applicant’s extension of time application.
[7] On 13 December 2018, the application was the subject of a Pre-Hearing Conference. During the Pre-Hearing Conference, the issue of the date of dismissal of the applicant was traversed and it became apparent to the Commission that the date of the applicant’s dismissal was 7 September 2018, and not 10 August 2018, as had been asserted by the employer. The Commission issued Directions for the Parties to file and serve evidence and all material upon which each would rely in respect of the arbitration of the application which was scheduled for a Hearing on 14 February 2019.
[8] The Parties provided documentary material in accordance with the Directions that were issued in conjunction with the Notice of Listing for the Hearing scheduled for 14 February 2019. The Hearing commenced on 14 February 2019, and regrettably there was no appearance by or on behalf of the employer. Prior to the commencement of the proceedings on 14 February, the employer was contacted by telephone in order to ascertain his whereabouts, and strangely, Mr Peter Kingsley advised my associate that he was unaware of the Hearing.
[9] In the circumstances, evidence was taken from the applicant and the proceedings were adjourned and re-listed for further Hearing on 7 March 2019. The employer subsequently appeared at the further Hearing of the arbitration of the matter. The Commission has accepted evidence from the applicant in the form of documentary material that has been respectively marked as Exhibits 1, 2 and 3. The documentary material from the employer, which comprised both evidence and submissions, was admitted during the further Hearing and became Exhibit 4.
[10] The applicant had worked for the employer for a period of approximately 3 years and 9 months. The applicant worked as a plumber, engaged in the employer’s commercial plumbing trade business operating from the Sydney suburb of Seven Hills.
[11] On 10 August 2018, the applicant’s driver’s licence was suspended for a month, and this created certain difficulties in respect to the capacity of the applicant to perform his work as a plumber. As a result of these difficulties, the applicant commenced a period of annual leave that covered the period of the suspension of his driver’s licence.
[12] The applicant anticipated returning to work on Monday, 10 September 2018. On Friday, 7 September 2018, the applicant telephoned the employer to inquire about the location of his work as anticipated on the following Monday, 10 September. During this telephone conversation the applicant was advised that his services were no longer required, and that he was being made redundant.
[13] The applicant was not subsequently provided with any written confirmation of the termination of his employment.
[14] The applicant was not paid outstanding accrued entitlements. Since the dismissal, the applicant has sought alternative employment with some success.
[15] The circumstances of this case are uncomplicated, and important aspects of evidence were without contest, making the determination of the matter reasonably straightforward. The applicant was a person protected from unfair dismissal and, in particular, his claim for unfair dismissal remedy was made within the time prescribed by subsection 394 (2) (b) of the Act.
[16] The largely unchallenged evidence of the applicant has established that he had been dismissed from his employment in an extraordinarily abrupt manner during a telephone conversation, and without any proper explanation or reason being provided. Importantly, the employer did not provide evidence that challenged the applicant’s version of the telephone conversation that occurred on Friday, 7 September 2018, when the applicant called Mr Peter Kingsley to inquire about a work location for the following Monday.
[17] Section 385 of the Act stipulates that the Commission must be satisfied that 4 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.
[18] In this case, the employer was a small business. Therefore, the provisions of subsection 385 (c) of the Act require consideration. Specifically, by way of operation of s. 388 of the Act, it is necessary to determine whether the dismissal of the applicant was or was not consistent with the Small Business Fair Dismissal Code (the SBFD Code).
[19] The SBFD Code is in the following terms:
“Small Business Fair Dismissal Code
Summary Dismissal
It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.
Other Dismissal
In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee’s conduct or capacity to do the job.
The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement.
The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee’s response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer’s job expectations.
Procedural Matters
In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.
A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.”
[20] In this case, the applicant was advised that he had been dismissed from employment during a telephone call with the employer when he was told that he was not required to return to work following a period of annual leave. The period of leave had coincided with the suspension of the applicant’s driver’s licence and the employer asserted that the applicant had resigned from his employment at the time at which his licence had been suspended.
[21] Despite the employer’s assertion that it had assumed that the applicant had verbally resigned on or about 10 August 2018, at the time at which the applicant was verbally advised that he had been dismissed, 7 September 2018, the employer told him that he had been made redundant. However, no proper explanation, consultation or documentary advice was at any time, provided to the applicant in respect to the termination of his employment. These circumstances establish that the dismissal of the applicant was not consistent with the SBFD Code, nor could the dismissal of the applicant have been a case of genuine redundancy.
[22] The dismissal of the applicant was not consistent with the SBFD Code, nor was it a case of genuine redundancy. Therefore, the matter has required further consideration in respect to that element contained in subsection 385 (b) of the Act, being whether the dismissal of the applicant was harsh, unjust or unreasonable. 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.
[23] The reason provided by the employer for the abrupt dismissal of the applicant during a telephone conversation on 7 September 2018, has no basis in fact. The employer has subsequently asserted that the applicant’s workmanship and work ethic was below professional standards, and that his dismissal may have been related to unsatisfactory work performance.
[24] The evidence that was introduced by the employer did not provide any basis to establish a sound and comprehensible reason for the dismissal of the applicant that related to his capacity or conduct. As a result, the reason for dismissal of the applicant was not sound, defensible or well-founded. There was not a valid reason for the dismissal of the applicant.
[25] The employer has not provided notification of dismissal, nor has it provided any other documentary record of the termination of employment.
[26] The employer did not provide any opportunity for the applicant to respond or provide any form of explanation for any issue that surrounded the termination of employment.
[27] The applicant was not provided with an opportunity to have a support person present during the telephone discussion when he was advised of his dismissal.
[28] The applicant was not dismissed for unsatisfactory performance and therefore this factor is not relevant in this case.
[29] The employer is a small business employer, and appropriate recognition for a degree of informality and flexibility in respect to employment related procedures has been provided.
[30] There was no evidence that the employer did have dedicated human resource management specialists. The absence of human resource management specialists and the level of informality that would understandably exist in a small business enterprise, could not justify the adoption of severely flawed employment practices associated with the dismissal of the applicant.
[31] The employer made no calculation, let alone payment, of accumulated leave or other entitlements due upon termination of employment.
[32] The failure to properly calculate, record, and pay due entitlement at or shortly after the time of termination of employment, would likely render the dismissal to have been unlawful. Although these entitlements are matters that may be pursued in other forms of litigation, a dismissal that included unlawful elements such as the failure to make payment of accumulated leave and other recognised entitlements, would establish that the dismissal was unjust and unreasonable.
[33] The employer failed to properly advance a case in opposition to the application and its approach to the defence of the unfair dismissal proceedings was broadly consistent with and reflective of the evidence of the unacceptable circumstances of the applicant’s dismissal. The absence of any documentation regarding the termination of the applicant’s employment was particularly concerning.
[34] The applicant was verbally advised of his dismissal during a telephone call, and subsequently he was not provided with a letter of dismissal which disclosed any valid reason for dismissal albeit apparently arising as a result of a purported redundancy. Regrettably, the employer adopted severely flawed employment management practices.
[35] The evidence has not revealed any valid reason for the dismissal of the applicant. The largely uncontested evidence has established that; (a) the applicant was 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.
[36] Upon any reasonable and balanced analysis, and particularly in the absence of a valid reason for dismissal, the applicant’s dismissal was harsh, unjust and unreasonable.
[37] The applicant has not sought reinstatement as remedy for his unfair dismissal. Frankly, that is not surprising given the conduct of the employer. In the circumstances, I am satisfied that reinstatement of the applicant would be inappropriate, and that payment of compensation would represent an appropriate remedy for the applicant's unfair dismissal.
[38] Section 392 of the Act prescribes certain matters that deal with compensation as a remedy for unfair dismissal. I have approached the question of compensation having regard for the guidance that can be identified from the Full Bench Decisions of, inter alia; Sprigg v Paul’s Licensed Festival Supermarket 1 (Sprigg); Smith and Ors v Moore Paragon Australia Ltd 2 and more recently, the cases of; McCulloch v Calvary Health Care Adelaide3; Balaclava Pastoral Co Pty Ltd v Nurcombe;4 and Hanson Construction Materials v Pericich5 (Pericich).
[39] Firstly, I confirm that an Order for payment of compensation to the applicant will be made against the respondent employer in lieu of reinstatement of the applicant.
[40] Secondly, in determining the amount of compensation that I Order, I have taken into account all of the circumstances of the matter including the factors set out in paragraphs (a) to (g) of subsection 392 (2) of the Act.
[41] There was no specific evidence provided which established that an Order of compensation would impact on the viability of the employer’s enterprise.
[42] The applicant had been employed for a period of about three years and nine months. The applicant would have been likely to have received remuneration of approximately $1,432.00 gross per week if he had not been dismissed.
[43] I have determined that the employment of the applicant would have continued for at least a 26 week period after his unfair dismissal.
[44] For the purposes of calculation of remuneration that the applicant would have received or would have been likely to receive if he had not been dismissed, I have considered that the employment of the applicant would have continued for a further 26 weeks. Therefore, the total remuneration that the applicant would have received in the notional period of 26 weeks following dismissal amounted to a figure of $37,232.00.
[45] The total amount of remuneration received in alternative employment, as identified, and that which may be reasonably likely to be earned between dismissal and the making of the Order for compensation, has been calculated to be $30,590.00.
[46] Thirdly, in this instance there was no established misconduct of the applicant, and consequently I have decided to make no reduction to the amount of compensation to be provided to the applicant on account of any established misconduct.
[47] Fourthly, I confirm that any amount Ordered does not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt caused to the applicant by the manner of the dismissal.
[48] Fifthly, the amount Ordered does not exceed the compensation cap as prescribed by s. 392 (5) of the Act.
[49] Consequently, for the reasons outlined above, taking into account all of the circumstances of the case, and having cognisance so as not to apply the approach taken in the Decision in Sprigg in a rigid, determinative manner, as was cautioned in the Decision in Pericich, I have decided that the amount of compensation to be provided to the applicant should be a gross figure of $6,642.00.
[50] Accordingly, separate Orders [PR705562] providing for unfair dismissal remedy in these terms will be issued.
COMMISSIONER
Appearances:
Mr A Duncan appeared unrepresented.
Mr P Kingsley and Ms B Kingsley, owners appeared for the employer.
Hearing details:
2019.
Sydney:
February, 14
March, 7.
Printed by authority of the Commonwealth Government Printer
<PR705560>
1 Sprigg v Paul’s Licensed Festival Supermarket, (Munro J, Duncan DP and Jones C), (1998) 88IR 21.
2 Smith and Ors v Moore Paragon Australia Ltd, (Lawler VP, Kaufman SDP and Mansfield C), (2004) PR942856.
3 John McCulloch v Calvary Health Care Adelaide, (Ross P, Hatcher VP and Gostencnik DP), [2015] FWCFB 873.
4 Balaclava Pastoral Co Pty Ltd t/a Australian Hotel Cowra v Darren Nurcombe, (Hatcher VP, Gostencnik DP and Cribb C) [2017] FWCFB 429.
5 Hanson Construction Materials Pty Ltd v Darren Pericich, (Ross P, Masson DP and Lee C), [2018] FWCFB 5960.