1
Fair Work Act 2009
s.604—Appeal of decision
Steven Guthrie
v
AJ & T Pulbrook Pty Ltd T/A Brook Motors
(C2016/3043)
SENIOR DEPUTY PRESIDENT HAMBERGER
DEPUTY PRESIDENT HAMILTON
COMMISSIONER RIORDAN SYDNEY, 11 MAY 2016
Appeal against decision [2016] FWC 914 of Commissioner Saunders at Newcastle on
26 February 2016 in matter number U2015/13054.
[1] Mr Steven Guthrie (the appellant) has applied for permission to appeal a decision1 of
Commissioner Saunders dated 26 February 2016.
[2] Mr Guthrie was employed by AJ & T Pulbrook Pty Ltd T/A Brook Motors (the
respondent) from 17 February 2014 to 18 September 2015 when his employment was
terminated for serious misconduct.
[3] The Commissioner found that Mr Guthrie was not unfairly dismissed, as the
termination of his employment was consistent with the Small Business Fair Dismissal Code
(the Code).
The decision
[4] The Commissioner summarised the events leading up to the appellant’s dismissal as
follows:
‘(a) Mr Guthrie had a dispute with a customer on 21 August 2015 in relation to the
amount the customer should be charged for the work undertaken by Mr Guthrie at
Brook Motors. Mr Warren Pulbrook and Mr Guthrie agree that the customer acted
unreasonably in refusing to make any payment for the work that had been undertaken
on his car;
(b) On 21 August 2015, Mr Guthrie poured water into the customer’s fuel tank before
he returned the car to the customer. Mr Guthrie says he did so because he extracted
some water from the fuel tank in the customer’s car when he was working on it and he
was simply returning the car to the customer in the same condition as it was when it
arrived in the Brook Motors’ workshop;
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(c) Mr Warren Pulbrook was absent overseas at the time the incident took place on 21
August 2015. Mr Warren Pulbrook arrived back in Australia in early September 2015,
at which time he returned to work; and
(d) After Mr Warren Pulbrook’s return to work in early September 2015, he undertook
an investigation into the incident concerning Mr Guthrie’s dispute with the customer
and then dismissed Mr Guthrie on 18 September 2015.’2
[5] The Commissioner was satisfied that the respondent was, immediately before the time
of the appellant’s dismissal, a small business employer.3
[6] The Commissioner referred to the following extract from the Full Bench decision in
Pinawin v Domingo (Pinawin):4
‘[29] … There are two steps in the process of determining whether this aspect of the
Small Business Fair Dismissal Code is satisfied. First, there needs to be a
consideration whether, at the time of dismissal, the employer held a belief that the
employee’s conduct was sufficiently serious to justify immediate dismissal. Secondly
it is necessary to consider whether that belief was based on reasonable grounds. The
second element incorporates the concept that the employer has carried out a reasonable
investigation into the matter. It is not necessary to determine whether the employer
was correct in the belief that it held.
[30] Acting reasonably does not require a single course of action. Different employers
may approach the matter differently and form different conclusions, perhaps giving
more benefit of any doubt, but still be acting reasonably. The legislation requires a
consideration of whether the particular employer, in determining its course of action in
relation to the employee at the time of dismissal, carried out a reasonable
investigation, and reached a reasonable conclusion in all the circumstances. The
circumstances include the experience and resources of the small business employer
concerned.
…
[38] Normally in order to hold a belief on reasonable grounds it will be necessary to
have a discussion with the employee about the perceived serious misconduct and pay
regard to the explanations and views given by the employee. We are concerned in this
case that no discussions took place about the implications of Mr Domingo’s conduct
for his future employment. However this is a very unusual case. The employer was
very small. The owners knew Mr Domingo well …’
[7] The Commissioner was satisfied that the respondent had terminated the appellant
without notice on the grounds that he had committed serious misconduct.5 He was also
satisfied that the appellant had engaged in conduct sufficiently serious to justify immediate
dismissal.
‘In particular, Mr Warren Pulbrook believed that Mr Guthrie engaged in a wilful and
malicious act by pouring water into the customer’s fuel tank and, as a result of that
conduct, Mr Warren Pulbrook no longer had any trust or confidence in Mr Guthrie.’6
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[8] The Commissioner indicated that in his view conduct by a mechanic in pouring water
into a customer’s fuel tank following a dispute with the customer over the amount to be
charged to the customer constituted serious misconduct. In particular it was wilful and
deliberate behaviour and caused serious and imminent risk to the reputation and (potentially)
the profitability of the employer’s business.7
[9] The Commissioner then turned to whether the respondent had carried out a reasonable
investigation and reached a reasonable conclusion in all the circumstances. The
Commissioner reviewed the evidence, noting amongst other things that the manager of the
business had not spoken to the appellant directly about the incident involving water being
poured into the customer’s fuel tank other than to tell him that he was investigating the
matter.8 He noted the following:
‘Normally in order to hold a belief on reasonable grounds it will be necessary to have a
discussion with the employee about the perceived serious misconduct and pay regard
to the explanations and views given by the employee. That did not happen in this case
in relation to the allegation that Mr Guthrie poured water into the customer’s car.
However, this is an unusual case. For the following reasons, I am satisfied that Brook
Motors undertook a reasonable investigation and reached a reasonable conclusion in all
the circumstances:
(a) Mr Warren Pulbrook was informed during his investigation that Mr Guthrie poured
water into a customer’s fuel tank following a disagreement with the customer and Mr
Guthrie admits that he engaged in that conduct;
(b) For the reasons set out in paragraph [46] above, it did not matter to Mr Warren
Pulbrook how much water Mr Guthrie poured into the customer’s fuel tank. Mr
Warren Pulbrook’s opinion in relation to that issue is, in my view, sound and
reasonable;
(c) Detailed evidence was given by Mr Guthrie during the determinative conference in
relation to his actions on 21 August 2015 and his reasons for acting in that way. I am
satisfied that even if Mr Warren Pulbrook had discussed the water pouring incident
with Mr Guthrie prior to his dismissal and had heard everything Mr Guthrie had to say
about that issue, Mr Warren Pulbrook would not have changed his decision to bring
Mr Guthrie’s employment to an immediate end on 18 September 2015;
(d) Brook Motors conducts a small mechanical and spare parts business, the success of
which depends on the relationships it forms with customers and the reputation it has in
the area. The conduct in which Mr Guthrie engaged in pouring water into a customer’s
fuel tank caused serious and imminent risk to the reputation of the business of Brook
Motors;
(e) Both Mr Warren Pulbrook and Mr Anthony Pulbrook are very experienced in the
motor vehicle industry. They are well placed to make an assessment as to the risks to
the business of Brook Motors by reason of the conduct in which Mr Guthrie engaged
on 21 August 2015. Having said that, they are inexperienced in dealing with
employment law issues and investigations leading up to a potential dismissal;
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(f) Mr Warren Pulbrook knew Mr Guthrie well, having worked closely with him for
about 18 months; and
(g) Having regard to Mr Guthrie’s conduct in pouring water into the customer’s fuel
tank following a disagreement with the customer, as well as Mr Guthrie’s past
behaviour and conduct in the workplace and his disputes with employees of Brook
Motors, Mr Warren Pulbrook had, in my view, a legitimate concern as to how Mr
Guthrie would react if he confronted him directly in relation to what happened on 21
August 2015.’9
[10] The Commissioner concluded that the appellant’s dismissal was consistent with the
Code. Accordingly he found that Mr Guthrie was not unfairly dismissed and his application
was dismissed.
The application for permission to appeal
[11] The application for permission to appeal was heard on 13 April 2016. The appellant
filed written submissions on 5 April 2016 and appeared for himself on 13 April 2016. The
Respondent, as it is entitled to do, advised that it would not appear or file submissions on the
issue of permission to appeal.
[12] The Appellant at the hearing said:10
‘In Previsic v Australian Quarantine Inspection Services it was found that an employee
had a duty of care to explicitly inform the employee of the reason for dismissal.
Saunders C confirmed that I was not provided any reason for my dismissal at the time I
was dismissed, paragraph 19.’
[13] The Appellant considered Commissioner Saunders erred in his conclusions on the
Code by relying not on Previsic but on Pinawin v Domingo. The Appellant said11
“Yes. So Saunders C has relied on the Full Bench decision of Pinawin v Domingo,
which has found that as a small business employer knew the respondent well, there
was no need to have a discussion about the reason for termination. In the Pinawin v
Domingo matter, the applicant was a long-term friend, paragraph 9, however in this
matter, I Steven Guthrie, have only known Mr Warren Pulbrook since I commenced
employment with Brook Motors; that is, 19 months of the date of my dismissal.
Mr Warren Pulbrook was my boss and work associate. He was not my friend.
Therefore the decision in Pinawin v Domingo is not a valid reason for not discussing
the reason for my dismissal. Saunders C has also neglected to take into account that
an employee should be given the opportunity to defend the reason for an alleged
misconduct, Wadey v YMCA Canberra [1996] cited in Dover Ray v Real Insurance
Pty Ltd [2010], paragraph 85.”
[14] The Appellant went on to say12:
‘… Mr Warren Pulbrook did not ask me about the matter and if he had asked me about
it, as he had already made his decision to terminate my employment, this did not afford
me an opportunity to defend my conduct, therefore the decision by Saunders C
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establishes a dangerous precedent that small business employers do not have to
provide a reason for dismissal or validly discuss the reason for dismissal with
employees.
Based on Brook Motors' failure to follow the requirements of the Small Business Fair
Dismissal Code and the Fair Work Act and the precedent that Saunders C's decision
makes, it is therefore in the public interest to allow an appeal of the decision in the
matter of U2015/13054 Steven Guthrie v A J and T Pulbrook Pty Ltd.’
Consideration
[15] This appeal is one to which s.400 of the Fair Work Act 2009 (FW Act) applies.13
Section 400 provides:
‘(1) Despite subsection 604(2), the FWC must not grant permission to appeal from a
decision made by the FWC under this Part unless the FWC considers that it is in the
public interest to do so.
(2) Despite subsection 604(1), an appeal from a decision made by the FWC in relation
to a matter arising under this Part can only, to the extent that it is an appeal on a
question of fact, be made on the ground that the decision involved a significant error
of fact.’
[16] In the Federal Court Full Court decision in Coal & Allied Mining Services Pty Ltd v
Lawler and others, Buchanan J (with whom Marshall and Cowdroy JJ agreed) characterised
the test under s.400 as ‘a stringent one’.14 The task of assessing whether the public interest
test is met is a discretionary one involving a broad value judgment.15 In GlaxoSmithKline
Australia Pty Ltd v Makin a Full Bench of the Commission identified some of the
considerations that may attract the public interest:
‘... the public interest might be attracted where a matter raises issues of importance and
general application, or where there is a diversity of decisions at first instance so that
guidance from an appellate court is required, or where the decision at first instance
manifests an injustice, or the result is counter intuitive, or that the legal principles
applied appear disharmonious when compared with other recent decisions dealing with
similar matters.’16
[17] It will rarely be appropriate to grant permission to appeal unless an arguable case of
appealable error is demonstrated. This is so because an appeal cannot succeed in the absence
of appealable error.17
[18] Section 385 of the FW Act provides, in effect, that a dismissal is not unfair if the
Commission is satisfied that it was consistent with the Code.
[19] The Code provides:
‘Commencement
The Small Business Fair Dismissal Code comes into operation on 1 July 2009.
Summary dismissal
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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] It is clear that the dismissal in question is covered by the section of the Code entitled
‘Summary Dismissal’. How the Commission should approach dismissals such as this was
dealt with in Pinawin. We are satisfied that the Commissioner correctly followed the
approach as set out in that decision. In particular, he had regard to the fact that the respondent
did not have a discussion with the appellant about the perceived serious misconduct.
Consistent with Pinawin he noted that it would normally be necessary to hold such a
discussion in order to hold a belief on reasonable grounds that an employee had engaged in
conduct sufficiently serious to justify immediate dismissal. However, he considered that for a
number of specific reasons this was not necessary in what he described as the unusual
circumstances of this case. While it may have been prudent for the respondent to have sought
the appellant’s explanation for what had occurred, there is no explicit requirement under the
Code to hold a discussion with a dismissed employee. It is not possible to predict the manner
in which an employer can come to a belief on reasonable grounds or to set down rigid rules
about how this might occur. We can see no arguable case of appealable error in his reasoning
in this regard.
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[21] We note that the other decisions referred to by the appellant, such as Presivic, do not
concern the Code. The matters set out s.387 of the FW Act concerning whether a dismissal
was harsh, unjust or unreasonable have no application where a dismissal by a small business
employer is consistent with the Code.
[22] We are not satisfied that it would be in the public interest to grant permission to
appeal. Accordingly, we refuse permission to appeal and the application is dismissed.
SENIOR DEPUTY PRESIDENT
Appearances:
The Appellant, Mr S Guthrie, appeared for himself.
[There was no appearance for the respondent.]
Hearing details:
Sydney.
2016.
April 13.
Printed by authority of the Commonwealth Government Printer
Price code C, PR580091
1 [2016] FWC 914.
2 Ibid [4].
3 Ibid [14].
4 [2012] FWAFB 1359.
5 [2016] FWC 914 [31].
6 Ibid [39].
7 Ibid [43].
8 Ibid [48].
9 Ibid [52].
10 PN13.
11 PN39-PN40.
12 PN42.
13 See Australian Postal Corporation v Gorman [2011] FCA 975 [37].
14 (2011) 192 FCR 78 [43].
15 O’Sullivan v Farrer (1989) 168 CLR 210 per Mason CJ, Brennan, Dawson and Gaudron JJ; applied in Hogan v Hinch
(2011) 85 ALJR 398 [69] per Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ; Coal & Allied Mining Services Pty
Ltd v Lawler and others (2011) 192 FCR 78 [44]-[46].
OF THE FAIR WORK THE COMMISSION THE SEAL
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16 [2010] FWAFB 5343 [27].
17 Wan v AIRC (2001) 116 FCR 481 [30].
