1
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Daniel Klein
v
Australian Pharmaceutical Industries Ltd T/A API
(U2014/7874)
VICE PRESIDENT WATSON MELBOURNE, 16 OCTOBER 2014
Application for unfair dismissal remedy - Whether termination of employment harsh, unjust
or unreasonable - Whether valid reason for dismissal - Dismissal related to conduct and
performance - Application dismissed - Fair Work Act 2009, ss. 394 and 387.
[1] This decision is an amended version of a decision given in transcript on 9 October
2014 in relation to an unfair dismissal application under s.394 of the Fair Work Act 2009 (the
Act) by Daniel Klein in relation to the termination of his employment with Australian
Pharmaceutical Industries Ltd (API).
[2] The application for an unfair dismissal remedy by Mr Klein arises from the
termination of his employment with API by way of a letter dated 26 May 2014. Mr Klein had
been employed for approximately two years in a technical capacity. The termination, as is
evident from the evidence in this matter and the letter of termination, arose from a series of
meetings between Mr Klein and his immediate managers and representatives of the human
resources department over a period of some months.
[3] In many ways this is an unfortunate case. It appears that the employment relationship
between the company and Mr Klein degenerated in the later period of the employment. Mr
Klein is recognised as having particular expertise but the relationship between him and his
managers deteriorated as a result of management’s perception of his performance, not so
much in relation to technical competence but in relation to reliability and attendance issues
and compliance with directions relating to reporting and the progress of his work.
[4] Another complication which is important in this matter is the medical condition
suffered by Mr Klein. He has been diagnosed with a fatigue related condition which impacted
on his ability to perform normal hours of work. He also has made it clear to the company,
and as is evident in the proceedings today, that he has difficulties in hearing. These matters I
think clearly have impacted on the communications between the parties and have led to a
deterioration and level of frustration between the parties ultimately leading to the termination.
I note in particular that the termination of employment occurred in circumstances where Mr
Klein expected that this would occur because of the nature of discussions regarding his
employment that had preceded the termination meeting on Monday, 26 May 2014.
[2014] FWC 7251
DECISION
E AUSTRALIA FairWork Commission
[2014] FWC 7251
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[5] The task of the Commission is to determine whether the dismissal was harsh, unjust or
unreasonable. The Commission is required to apply that test by reference to the objects of
Part 3-2 of the Act, including the objective of ensuring that there is a fair go all round
accorded to both the employer and the employee in such matters. The Act also sets out the
criteria for considering whether a dismissal is harsh, unjust or unreasonable in s.387 of the
Act. Those criteria are clearly intended by the legislature to guide the conclusion on the
overall question of whether the termination was harsh, unjust or unreasonable.
[6] I propose to consider each of those matters as far as they are relevant in determining
the ultimate question that I must determine in this matter. The first consideration in s.387 is,
“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).” The authorities in
relation to this question make it clear that in determining this question, it is not a matter of the
Commission putting itself in the place of the employer and determining what it would have
done in the circumstances. It is a matter of evaluating the reasons relied on by the employer
and determining whether the reasons were valid, in the sense that they were sound, defensible
and well-founded rather than fanciful or not soundly based.
[7] The reasons for termination are set out in the letter of termination of 26 May 2014.
They are summarised as:
“Attitude and behaviour specifically lack of communication regarding late
arrival on Friday 23 May and failure to attend scheduled meeting.
Ongoing lack of engagement and non-compliance of processes put in place to
assist with task management.”
[8] The evidence in this matter establishes a considerable history of considerations by the
company as to working arrangements and its desired monitoring of work progress of Mr Klein
by way of a performance review process. Clearly the company formed the view that Mr Klein
was not performing to its expectations in relation to these matters even though it
acknowledges that he had the technical expertise to perform the requirements of the job.
[9] As I indicated earlier it is clearly relevant that Mr Klein had health issues at the time
and required some understanding and compensation in relation to those matters as they related
to the performance of his work. In my view, the evidence in this matter has established that
the company took appropriate measures to provide appropriate compensation and
consideration of those health issues. Yet the company found that its attempts to monitor and
consider Mr Klein’s performance were frustrated by the failure of Mr Klein to fully and
appropriately demonstrate his work performance in accordance with the work program that
had been put in place.
[10] Mr Klein considered that the company did not accept his explanations for the
shortcomings in his reliability and attendance. Mr Klein believed that it reached the point that
nothing he could say was going to alter the company’s view. It appears also that his
assessment was accurate because the company was not satisfied with the explanations and
was not satisfied with ongoing failures to comply with its directions regarding reporting on
progress and communications generally. There are other issues involved such as
disagreements regarding the performance of work, the hours in which work was performed
and the location of work which added to the tension between the parties.
[2014] FWC 7251
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[11] The company made its requirements clear. Mr Klein considered those to be
unreasonable. His view in relation to that matter appears to have contributed to the ongoing
difficulties between the parties and the ongoing failure of Mr Klein to meet the company’s
expectations. In all the circumstances, I consider that there was a valid reason for the
dismissal relating to Mr Klein’s conduct in the performance of his role. I make that finding
for the purposes of subsection (a).
[12] The next consideration is whether the employee was notified of that reason. The
evidence in this matter establishes that there was a long history of meetings and performance
counselling and, as recorded in the termination letter, an opportunity provided to Mr Klein to
provide his account of the situation. The responses he provided are also recorded in the
termination letter. The reasons for termination as I have indicted are multifaceted and relate
very generally to failures to follow directions in relation to reporting and communication. I
am satisfied that those matters were the subject of the earlier discussions and the company
notified Mr Klein of its reasons for termination.
[13] The next criterion is related. It is whether Mr Klein was given an opportunity to
respond to any reason relating to capacity or conduct. In relation to that matter, I find that Mr
Klein was given that opportunity. It is apparent that his responses were not viewed
favourably. He regarded that as quite unreasonable. In terms of whether an opportunity was
provided, I find that it was. I note in accordance with the termination letter, Mr Klein’s
representations where taken into account although it appears that were not given sufficient
weight to alter the decision that was ultimately reached in relation to the termination.
[14] The next matter is whether there was any unreasonable refusal by the employer to
allow Mr Klein to have a support person present to assist at any discussions relating to the
dismissal. The evidence in this matter establishes that on some occasions that opportunity
was expressly communicated. On some occasions it was not. Towards the end of the process
it was taken up. I am not of the view on the basis of the evidence that there was any request
by Mr Klein for representation that was unreasonably refused. I make those findings in
relation to that factor.
[15] The next criterion applies in the case of unsatisfactory performance, which is the basis
for termination in this matter. It is whether Mr Klein had been warned about that
unsatisfactory performance before the dismissal. This criterion relates to conduct and
behavioural issues that fall short of serious misconduct where unsatisfactory performance can
be a ground for termination provided there is appropriate communication of the areas of
unsatisfactory performance and an opportunity to improve on that performance to avoid the
consequences of termination.
[16] The evidence in this matter demonstrates that there was a long history of performance
counselling and management. There were formal meetings, there were formal written
warnings, and there were informal meetings and discussions. Many of those meetings may
have been unsatisfactory and involved a significant amount of tension. They may also have
been affected by communication difficulties between the parties. Nevertheless I consider that
in totality, Mr Klein was warned about his unsatisfactory performance before the dismissal. I
consider that he was also given the opportunity to improve on that performance by addressing
the performance inadequacies to avoid the consequences of dismissal.
[2014] FWC 7251
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[17] The next two factors relate to the size of the employer’s enterprise and the extent to
which the resources within the enterprise might impact on its ability to comply with
procedures effecting the dismissal. This employer was not a small employer. It has dedicated
human resource management specialists. Those specialists where involved in this matter and
I do not consider that those factors bear upon the ultimate conclusion in relation to this matter.
[18] I am also required to have regard to any other matters that the Commission considered
relevant. I have had regard to all of the circumstances and evidence in this matter and the
matters that I have summarised earlier. I have also had regard to what I have described as the
unfortunate circumstances, the clearly unhappy working arrangements which existed, the
impact of the health of Mr Klein and his personal circumstances and his ability to work in a
normal manner and the measures that were taken by the company to accommodate those
concerns. I have also had regard to Mr Klein’s acknowledged expertise in his specialist field.
[19] In all of the circumstances I am not of the view that the dismissal of Mr Klein was
harsh or unjust or unreasonable. In view of that finding, I propose to dismiss the unfair
dismissal application. An order to this effect is issued in conjunction with this decision
(PR556590).
VICE PRESIDENT WATSON
Appearances:
Mr D. Klein on his own behalf.
Ms T. Badley for Australian Pharmaceutical Industries Ltd.
Hearing details:
2014.
Melbourne.
9 October.
Printed by authority of the Commonwealth Government Printer
Price code A, PR556580
