1
Fair Work Act 2009
s.394—Unfair dismissal
Zack Bentley-Gates
v
El Gringos Locos Pty Ltd
(U2021/8813)
COMMISSIONER MATHESON SYDNEY, 7 MARCH 2022
Application for unfair dismissal remedy.
[1] On 3 October 2021, Mr Zack Bentley-Gates (Applicant) made an application to the Fair
Work Commission (Commission) under s.394 of the Fair Work Act 2009 (Cth) (FW Act) for a
remedy, alleging that he had been unfairly dismissed from his employment with El Gringos
Locos Pty Ltd (Respondent). The Applicant seeks financial compensation.
When can the Commission order a remedy for unfair dismissal?
[2] Section 390 of the FW Act provides that the Commission may order a remedy if:
(a) the Commission is satisfied that the Applicant was protected from unfair dismissal
at the time of being dismissed; and
(b) the Applicant has been unfairly dismissed.
[3] Both limbs must be satisfied. I am therefore required to consider whether the Applicant
was protected from unfair dismissal at the time of being dismissed and, if I am satisfied that the
Applicant was so protected, whether the Applicant has been unfairly dismissed.
When is a person protected from unfair dismissal?
[4] Section 382 of the FW Act provides that a person is protected from unfair dismissal if,
at the time of being dismissed:
(a) the person is an employee who has completed a period of employment with his or
her employer of at least the minimum employment period; and
(b) one or more of the following apply:
(i) a modern award covers the person;
(ii) an enterprise agreement applies to the person in relation to the employment;
[2022] FWC 501 [Note: An appeal pursuant to s.604 (C2022/1980) was
lodged against this decision – refer to Full Bench decision dated 11 May 2022
[[2022] FWCFB 70] for result of appeal.]
DECISION
AUSTRALIA FairWork Commission
http://www.fwc.gov.au/documents/decisionssigned/html/2022FWCFB70.htm
[2022] FWC 501
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(iii) the sum of the person’s annual rate of earnings, and such other amounts (if
any) worked out in relation to the person in accordance with the regulations,
is less than the high income threshold.
When has a person been unfairly dismissed?
[5] Section 385 of the FW Act provides that a person has been unfairly dismissed if the
Commission is satisfied that:
(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.
Background
[6] The uncontested factual background to the matter is as follows:
The Applicant commenced working for the Respondent on 24 February 2021 and, at
the time of his employment coming to an end, was employed full time as a Bar
Manager.
On 27 June 2021, the Respondent’s business temporarily ceased operation due to
public health orders implemented as a result of the COVID-19 pandemic and it stood
down its workforce for this period.
The Applicant was notified of his dismissal via email on 13 September 2021 and his
employment came to an end on 19 September 2021.
The Respondent recommenced its operations on 11 October 2021.
[7] In correspondence dated 13 September 2021, the Respondent stated, in summary, that
the reason for the dismissal was redundancy as result of economic downturn due to the COVID-
19 pandemic, reduced customer capacities placed on the hospitality industry and the impact of
the public health order.
[8] The Applicant claims that the dismissal was not a case of genuine redundancy and that
he has been unfairly dismissed.
[9] The Respondent denies that the Applicant has been unfairly dismissed as the dismissal
was a case of genuine redundancy.
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The conference
[10] There being contested facts involved, the Commission is obliged by s.397 of the FW
Act to conduct a conference or hold a hearing.
[11] After taking into account the views of the Applicant and the Respondent and whether a
hearing would be the most effective and efficient way to resolve the matter, I considered it
appropriate to hold a determinative conference for the matter (s.399 of the FW Act).
[12] At the conference on 10 January 2022, the Applicant and Respondent were self-
represented, with Ms Monique Annetts, Director of the Respondent, appearing for the
Respondent.
Witnesses
[13] During the conference, the Applicant gave evidence on his own behalf and Ms Annetts
gave evidence on the Respondent’s behalf.
Submissions
[14] The Applicant filed submissions in the Commission on 10 December 2021. The
Respondent filed submissions in the Commission on 22 December 2021. Final written
submissions in reply were filed by the Applicant on 7 January 2022.
Has the Applicant been dismissed?
[15] A threshold issue to determine is whether the Applicant has been dismissed from his
employment.
[16] Section 386(1) of the FW Act provides that the Applicant has been dismissed if:
(a) the Applicant’s employment with the Respondent has been terminated on the
Respondent’s initiative; or
(b) the Applicant has resigned from their employment but was forced to do so because
of conduct, or a course of conduct, engaged in by the Respondent.
[17] Section 386(2) of the FW Act sets out circumstances where an employee has not been
dismissed, none of which are presently relevant.
[18] There was no dispute and I find that the Applicant’s employment with the Respondent
terminated at the initiative of the Respondent.
[19] I am therefore satisfied that the Applicant has been dismissed within the meaning of
s.386 of the FW Act.
[2022] FWC 501
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Initial matters
[20] Under s.396 of the FW Act, the Commission is obliged to decide the following matters
before considering the merits of the application:
(a) whether the application was made within the period required in subsection 394(2);
(b) whether the person was protected from unfair dismissal;
(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;
(d) whether the dismissal was a case of genuine redundancy.
Was the application made within the period required?
[21] Section 394(2) of the FW Act requires an application to be made within 21 days after
the dismissal took effect.
[22] It is not disputed and I find that the Applicant was dismissed from his employment on
19 September 2021 and made the application on 3 October 2021. I am therefore satisfied that
the application was made within the period required in s.394(2).
Was the Applicant protected from unfair dismissal at the time of dismissal?
[23] I have set out above when a person is protected from unfair dismissal.
Minimum employment period
[24] It was not in dispute and I find that the Respondent is not a small business employer,
having 15 or more employees at the relevant time.
[25] It was not in dispute and I find that the Applicant was an employee, who commenced
his employment with the Respondent on 24 February 2021 and was dismissed on 19 September
2021, a period in excess of 6 months.
[26] It was not in dispute and I find that the Applicant was an employee.
[27] I am therefore satisfied that, at the time of dismissal, the Applicant was an employee
who had completed a period of employment with the Respondent of at least the minimum
employment period.
[28] It was not in dispute and I find that, at the time of dismissal, the Applicant was covered
by an award, being the Restaurant Industry Award 2020 (Award).
[29] I am therefore satisfied that, at the time of dismissal, the Applicant was a person
protected from unfair dismissal.
[2022] FWC 501
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Was the dismissal consistent with the Small Business Fair Dismissal Code?
[30] Section 388 of the FW Act provides that a person’s dismissal was consistent with the
Small Business Fair Dismissal Code if:
(a) immediately before the time of the dismissal or at the time the person was given
notice of the dismissal (whichever happened first), the person’s employer was a
small business employer; and
(b) the employer complied with the Small Business Fair Dismissal Code in relation to
the dismissal.
[31] As mentioned above, I find that the Respondent was not a small business employer
within the meaning of s.23 of the FW Act at the relevant time, having in excess of 14 employees
(including casual employees employed on a regular and systematic basis).
[32] I am therefore satisfied that the Small Business Fair Dismissal Code does not apply, as
the Respondent is not a small business employer within the meaning of the FW Act.
Was the dismissal a case of genuine redundancy?
[33] Under s.389 of the FW Act, a person’s dismissal was a case of genuine redundancy if:
(a) the employer no longer required the person’s job to be performed by anyone because
of changes in the operational requirements of the employer’s enterprise; and
(b) the employer has complied with any obligation in a modern award or enterprise
agreement that applied to the employment to consult about the redundancy.
Section 389(1)(a) – did the Respondent no longer require the Applicant’s job to be performed
by anyone because of changes in the operational requirements of the employer’s enterprise?
[34] In Ulan Coal Mines Limited v Howard and ors1a Full Bench of the Commission referred
to the observation of Ryan J in Jones v Department of Energy and Minerals2 that a job involves
“a collection of functions, duties and responsibilities entrusted, as part of the scheme of
employees’ organisation, to a particular employee”. The Full Bench went on to His Honour’s
statement that:
“What is critical for the purpose of identifying a redundancy is whether the holder of the
former position has, after the re-organisation, any duties left to discharge. If there is no
longer any function or duty to be performed by that person, his or her position becomes
redundant…”3
1 [2010] FWAFB 3488, [17].
2 (1995) 60 IR 304, 308.
3 Ulan Coal Mines Limited v Henry Job Howarth and others [2010] FWAFB 3488, [17], citing Jones v Department of
Energy and Minerals (1995) 60 IR 304, 308.
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[35] The Full Bench cited Dibb v Commissioner of Taxation4 in stating that this does not
mean that if any aspect of the employee’s duties is still to be performed by somebody, they
cannot be redundant and observed that the examples in the Explanatory Memorandum illustrate
circumstances where tasks and duties of a particular employee continue to be performed by
other employees but that nevertheless the “job” of the employee no longer exists.5
[36] The test to be applied is whether the Applicant’s job has survived the restructure or
downsizing, not whether the duties survive.6
[37] Ms Annetts gave evidence during the conference that:
the decision to dismiss the Applicant was made by her and that the Respondent
dismissed the Applicant because the business was impacted by the COVID-19
pandemic, which resulted in a financial impact and need to reduce staff costs. Ms
Annetts said there were no other reasons for the dismissal of the Applicant;
she formed the view that she did not require the Applicant’s job as Bar Manager to
be performed by anyone, particularly as the Respondent’s business would be
operating at reduced capacity upon reopening; and
there was only one Bar Manager employed at the time of the Applicant’s dismissal,
being the Applicant, and the role has not been replaced since the Applicant’s
dismissal.
[38] The Applicant gave evidence during the conference that:
while the role of Bar Manager was given to him by the Respondent, his role was not
simply one of a ‘Bar Manager’ and there were times throughout the week where was
doing more than his role. In particular, he said that his position involved training staff
to look after the bar, undertake ordering and ensuring progression of the business;
he was the only one in the business who had lost his position other than those
employees who did not come back to work following the stand down period that
resulted from the COVID-19 pandemic and this came as a shock to him because he
was a large part of the business and worked in it on more days than any other staff;
throughout the stand down period, he had formed the view that he would be returning
to work and Ms Annetts had had conversations with him about this; and
he believed he was dismissed because had made comments about his vaccination
status and requests for medical information in a Facebook ‘chat’ which had become
‘quite negative’ and which he believed had upset Ms Annetts.
4 (2004) FCR 388, 404-405.
5 Ulan Coal Mines Limited v Henry Job Howarth and others [2010] FWAFB 3488, [17].
6 Ibid, citing Kerkeris v A.Hartrodt Australia Pty Ltd [2010] FWA 674, [27].
[2022] FWC 501
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[39] I accept the evidence of the Respondent that its business was adversely impacted by the
COVID-19 pandemic, including because of mandatory closures and reduced operating capacity
as a result of public health orders. The Respondent sought to reduce operating costs as a result
of these impacts and restructured its business to remove the role of Bar Manager. This does not
necessarily mean that the functions or duties previously performed by the Applicant were no
longer required to be performed. However, the job of Bar Manager is no longer in the
Respondent’s business structure and has not been replaced.
[40] On the basis of the materials and evidence before the Commission, I find that the
Respondent no longer required the Applicant’s job to be performed by anyone because of
changes in the operational requirements of the Respondent’s enterprise, those changes having
been brought about as a result of the impact of the COVID-19 pandemic upon the Respondent’s
business.
Section 389(1)(b) – has the Respondent complied with any obligation in a modern award or
enterprise agreement that applied to the employment to consult about the redundancy?
[41] The obligation of an employer to consult about redundancy arises where a modern award
or enterprise agreement applied to an employee and that instrument contains requirements to
consult about redundancy.
[42] It was not in dispute, and I find that, at the time of dismissal, the Applicant was covered
by the Award.
[43] The Award sets out consultation obligations at clause 32. In particular, that clause states:
“32.1 If an employer makes a definite decision to make major changes in production,
program, organisation, structure or technology that are likely to have significant effects
on employees, the employer must:
(a) give notice of the changes to all employees who may be affected by them and their
representatives (if any); and
(b) discuss with affected employees and their representatives (if any):
(i) the introduction of the changes; and
(ii) their likely effect on employees; and
(iii) measures to avoid or reduce the adverse effects of the changes on employees;
and
(c) commence discussions as soon as practicable after a definite decision has been
made.
32.2 For the purposes of the discussion under clause 32.1(b), the employer must give
in writing to the affected employees and their representatives (if any) all relevant
information about the changes including:
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(a) their nature; and
(b) their expected effect on employees; and
(c) any other matters likely to affect employees.
32.3 Clause 32.2 does not require an employer to disclose any confidential
information if its disclosure would be contrary to the employer’s interests.
32.4 The employer must promptly consider any matters raised by the employees or
their representatives about the changes in the course of the discussion under
clause 32.1(b).
32.5 In clause 32 significant effects, on employees, includes any of the following:
(a) termination of employment; or
(b) major changes in the composition, operation or size of the employer’s workforce or
in the skills required; or
(c) loss of, or reduction in, job or promotion opportunities; or
(d) loss of, or reduction in, job tenure; or
(e) alteration of hours of work; or
(f) the need for employees to be retrained or transferred to other work or locations; or
(g) job restructuring.
32.6 Where this award makes provision for alteration of any of the matters defined at
clause 32.5, such alteration is taken not to have significant effect”.
[44] I am satisfied that the definite decision to remove the role of Bar Manager from the
structure of the business constituted a major change to its structure and organisation and that
this major change would have a significant effect on the Applicant, being the termination of his
employment. As such, I find that the consultation obligations under clause 32 of the Award
were enlivened.
[45] During the conference, I asked Ms Annetts to describe what steps, if any, were taken to
comply with the consultation obligations in the Award. Ms Annetts’ evidence was that:
several phone calls were made to the Applicant from herself and ‘MJ’, a former
employee and administrative assistant of Ms Annetts, and these were followed by an
email to the Applicant and then a letter;
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https://asset.fwc.gov.au/documents/documents/modern_awards/award/ma000119/ma000119-40.htm#P965_85869
https://asset.fwc.gov.au/documents/documents/modern_awards/award/ma000119/ma000119-40.htm#P979_87198
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she made the phone calls seven days prior to her sending an email to the Applicant
advising of his dismissal however he did not answer the phone;
MJ made phone calls to the Respondent twice a day, every day during this period
and, during the last call answered by the Applicant, he indicated he was working for
someone else;
at the time of these events, the Respondent was impacted by a lockdown and public
health orders, which meant that persons were not able to drive more than five
kilometres from their home address and, as a result, she considered it inappropriate
to require the Applicant to come into the office to have a conversation; and
she considered that the communications with the Respondent were “enough” to meet
her obligations.
[46] The Applicant gave evidence at the conference that:
he did not receive two or three phone calls a day from the Respondent;
he did receive a phone call from Ms Annetts in which she asked him whether he had
heard from MJ and whether he intended to get in contact with her;
he missed a phone call from MJ and returned her call after she left a voicemail. During
that call, he found out who MJ was and what her role with the Respondent was and a
time was organised for him to call her back, as he was assisting his father with work
that day;
the call with MJ did not occur as planned. The following day, Ms Annetts called the
Applicant and asked him if he had been in contact with MJ and asked what his stance
was regarding returning to work. Ms Annetts explained MJ would be calling him to
discuss details in relation to his return to work. The Applicant understood this call
would be to discuss whether he was vaccinated at that time and matters related to his
return to work; and
when he received the email notifying him of the redundancy, he had not received any
prior communication or notification about this.
[47] During the conference, I took the parties to a letter dated 13 September 2021 and titled
“Termination of your employment by reason of redundancy”, filed with the Applicant’s
materials, which states:
“The purpose of this letter is to confirm the outcome of a recent review by El Gringos
Locos Pty Ltd (the employer) of its operational requirements, and what this means for
you.
As a result of economic downturn due to the Coronavirus Pandemic and the reduced
customer capacities placed on the hospitality industry and Penrith LGA for re-opening
as per the NSW Public Health Order, the position of Bar Manager is no longer needed.
[2022] FWC 501
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Regrettably this means your employment will terminate. This decision is not a reflection
on your performance.
The employer has made the following attempts to find you an alternative position within
the enterprise and any associated entities we have considered all other positions within
this and other businesses however due to the coronavirus pandemic and reduced
customer capacity placed on the hospitality and events industries and Penrith and our
other operating LGAs for re-opening as per NSW public health order we are unable to
find a suitable option.
Based on your length of service, your notice period is 1 week. Therefore your
employment will end on 19th September 2021
Due to your employment ending because of redundancy, you will be paid redundancy
pay of $1292.00 in accordance with Restaurant Industry Award. This amount represents
1 weeks’ pay which is based on your 7 months of service.
…..”
[48] The Applicant confirmed that he received this letter via email. The Applicant’s evidence
was that he received a payment in his account which prompted him to check his email and,
upon doing so, he found the letter of termination. The Applicant’s evidence was that this was
the first time he learned about the termination of his employment.
[49] Ms Annetts’ evidence was that the termination payment was made to the Applicant 10
minutes after the email was sent to the Applicant notifying him of the termination of his
employment and no other discussions about the termination of his employment took place.
[50] As noted above, if an employer makes a definite decision to make major changes in
production, program, organisation, structure or technology that are likely to have significant
effects on employees, the Award provides that the employer must (among other things):
(a) give notice of the changes to all employees who may be affected by them and their
representatives (if any); and
(b) discuss with affected employees and their representatives (if any):
(i) the introduction of the changes; and
(ii) their likely effect on employees; and
(iii) measures to avoid or reduce the adverse effects of the changes on employees;
and
(c) commence discussions as soon as practicable after a definite decision has been
made.
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[51] For the purposes of the discussion under clause 32.1(b) of the Award, the employer
must give in writing to the affected employees and their representatives (if any) all relevant
information about the changes including:
(a) their nature; and
(b) their expected effect on employees; and
(c) any other matters likely to affect employees.
[52] There is confusion around whether the Applicant was required to return the call of ‘MJ’
or whether the Respondent was to call the Applicant when he indicated he was not available
and a new time was coordinated. Regardless, even if the Applicant did not call back at the
coordinated time, I find that it would not have been unreasonable for the Respondent to make
a further call to the Applicant in the circumstances of a definite decision having been made to
terminate his employment and that making a further call would have assisted the Respondent
in meeting its consultation obligations under the Award. Further, I accept the evidence of the
Applicant that he believed the call was to discuss his return to work upon the easing of
restrictions and, had the Respondent explained to the Applicant why it was seeking to have this
conversation, it is likely that the conversation would have been prioritised by the Applicant who
was unaware he was facing the loss of his employment.
[53] However, there were no discussions with the Applicant about the decision to remove
the role of Bar Manager from the structure of the Respondent’s business or to terminate the
Applicant’s employment. Rather, the Applicant was advised of the decision that his role would
be made redundant and his employment terminated when the Respondent communicated this
to him via email on 13 September 2021, attaching the letter of termination.
[54] During the conference, Ms Annetts conceded that she did not fulfil the consultation
process in the Award to the extent that she could have and indicated that this was due to her
inexperience. Ms Annetts did however indicate that she had contacted the Fair Work
Ombudsman about the process and that the Ombudsman is where she had sourced the template
letter used to communicate the dismissal. Ms Annetts stated that, at the time, she believed she
did everything she could to comply with her obligations.
[55] In these circumstances, the Respondent failed to meet a technical requirement of the
consultation provision in the Award. I am therefore satisfied that the dismissal was not a case
of genuine redundancy for the purposes of s.389 of the FW Act. The Respondent’s jurisdictional
objection is dismissed.
[56] Given the conclusion reached, it is unnecessary to consider s.389(2) of the FW Act,
being whether it would have been reasonable in all the circumstances for the Applicant to have
been redeployed within the Respondent or an associated entity.
Was the dismissal harsh, unjust or unreasonable?
[57] The jurisdictional objection has been determined and rejected and it is therefore
necessary to turn to the substantive merits of the application.
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[58] Section 387 of the FW Act provides that, in considering whether it is satisfied that a
dismissal was harsh, unjust or unreasonable, the Commission must take into account:
(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.
[59] I am required to consider each of these criteria, to the extent they are relevant to the
factual circumstances before me.7
[60] I set out my consideration of each below.
Section 387(a) - was there a valid reason for the dismissal related to the Applicant’s capacity
or conduct?
[61] The reason for the Applicant’s dismissal was not related to the Applicant’s capacity or
conduct. Accordingly, there cannot have been and was not a valid reason for his dismissal
related to his capacity or conduct. In the circumstances of this case, I regard it as a neutral matter
in relation to my consideration of whether the Applicant’s dismissal was harsh, unjust or
unreasonable.
7 Sayer v Melsteel Pty Ltd [2011] FWAFB 7498, [14]; Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP,
Lacy SDP, Simmonds C, 21 March 2002), [69].
https://www.fwc.gov.au/documents/alldocuments/pr915674.htm
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Sections 387(b) and (c) - was the Applicant notified of the valid reason and given an
opportunity to respond to any valid reason related to their capacity or conduct?
[62] The matters in s.387(b) and (c) of the FW Act deal with whether there was procedural
fairness in relation to a reason for dismissal related to capacity or conduct. As noted above, the
reason for the Applicant’s dismissal was not related to the Applicant’s capacity or conduct. As
such, I regard these as neutral matters in relation to my consideration of whether the Applicant’s
dismissal was harsh, unjust or unreasonable.
Section 387(d) - did the Respondent unreasonably refuse to allow the Applicant to have a
support person present to assist at discussions relating to the dismissal?
[63] In relation to s.387(d) of the FW Act, there were no discussions related to the dismissal
and no unfairness arises with response to a support person. I regard it as a neutral matter in
relation to my consideration of whether the Applicant’s dismissal was harsh, unjust or
unreasonable.
Section 387(e) - if the dismissal related to unsatisfactory work performance, was the
Applicant warned about that unsatisfactory performance before the dismissal?
[64] The reason for the Applicant’s dismissal was not related to unsatisfactory work
performance. I regard this as a neutral matter in relation to my consideration of whether the
Applicant’s dismissal was harsh, unjust or unreasonable.
Sections 387(f) and (g) - to what degree would the size of the Respondent’s enterprise and
absence of dedicated human resource management specialists or expertise in the
Respondent’s enterprise be likely to impact on the procedures followed in effecting the
dismissal?
[65] With respect to s.387(f) of the FW Act, neither party submitted that the size of the
Respondent’s enterprise was likely to impact on the procedures followed in effecting the
dismissal and I find that the size of the Respondent’s enterprise had no such impact. I regard
this as a neutral matter in my consideration of whether the Applicant’s dismissal was harsh,
unjust or unreasonable
[66] With respect to s.387(g) of the FW Act, I accept the evidence of Ms Annetts that the
Respondent did not have dedicated human resources management specialists at the time of the
Applicant’s dismissal. Ms Annetts conceded that her inexperience impacted the procedures
followed and indicated that, had she had obtained advice, she would have coordinated a Zoom
call with the Applicant to discuss the decision to make him redundant, however the outcome
would not have been different.
[67] I find that the likely impact of the absence of human resources specialists on the manner
in which the Applicant’s dismissal was dealt with is that the consultation provision in the Award
was not complied with.
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Section 387(h) - what other matters are relevant?
[68] Section 387(h) of the FW Act requires the Commission to take into account any other
matters that the Commission considers relevant.
[69] I am satisfied that the Respondent had a bona fide reason to dismiss the Applicant having
regard to its operational requirements and the impacts of the COVID-19 pandemic. While the
reason is not related to the Applicant’s capacity or conduct, it is nevertheless a bona fide reason
and weighs against a finding that the dismissal was unfair.
[70] However, the Respondent failed to meet a technical requirement in the consultation
provision of the Award in that no discussions were held with the Applicant of the nature
prescribed by the Award. I accept the Respondent’s evidence that its business had been
adversely affected by the COVID-19 pandemic and that it reduced its wage costs to deal with
this, including by not replacing employees that left, reducing hours of casual staff and making
the Applicant redundant, and that the outcome, being the decision to dismiss the Applicant,
would not have changed had the Respondent held discussions with the Applicant as
contemplated by the consultation provision in the Award. However, discussions should have
been held with the Applicant about the decision to make his role redundant and the fact that the
dismissal was conducted in breach of the consultation provisions of the Award weighs in favour
of a finding that the dismissal was harsh, unjust or unreasonable.
[71] I have also had regard to the Applicant’s length of service of approximately seven
months, noting this is not a lengthy period of time.
Is the Commission satisfied that the dismissal of the Applicant was harsh, unjust or
unreasonable?
[72] I have made findings in relation to each matter specified in s.387 as relevant.
[73] I must consider and give due weight to each as a fundamental element in determining
whether the termination was harsh, unjust or unreasonable.8
[74] Having considered each of the matters specified in s.387 of the FW Act, I am satisfied
that the dismissal of the Applicant was unjust, the primary reason being the failure to consult
with the Applicant as required by the consultation provision in the Award.
[75] Having found that the dismissal was unjust, I am therefore satisfied that the Applicant
was unfairly dismissed within the meaning of s.385 of the FW Act.
Remedy
[76] Being satisfied that the Applicant:
made an application for an order granting a remedy under s.394;
8 ALH Group Pty Ltd t/a The Royal Exchange Hotel v Mulhall (2002) 117 IR 357, [51]. See also Smith v Moore Paragon
Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002), [92]; Edwards v Justice Giudice
[1999] FCA 1836, [6]–[7].
[2022] FWC 501
15
was a person protected from unfair dismissal; and
was unfairly dismissed within the meaning of s.385 of the FW Act,
I may, subject to the FW Act, order the Applicant’s reinstatement, or the payment of
compensation to the Applicant.
[77] Under s.390(3) of the FW Act, I must not order the payment of compensation to the
Applicant unless:
(a) I am satisfied that reinstatement of the Applicant is inappropriate; and
(b) I consider an order for payment of compensation is appropriate in all the
circumstances of the case.
Is reinstatement of the Applicant inappropriate?
[78] The mere fact that the position that was occupied by the Applicant no longer exists does
not render an order for reinstatement inappropriate.9 As a Full Bench of the Australian Industrial
Relations Commission observed, the adoption of such an approach “would tend to defeat the
remedial purpose of the legislation.”10
[79] However, I accept the evidence of the Respondent that its business has suffered adverse
effects arising from the COVID-19 pandemic in which it has needed to reduce the size and cost
of its workforce. I also find that, had the Respondent held discussions with the Applicant to
consult about the decision to dismiss him on the grounds of redundancy in compliance with the
Award, the outcome would not have changed and in those circumstances the dismissal would
not have been harsh, unjust or unreasonable, and therefore not unfair. The Applicant did not
seek reinstatement.
[80] In the circumstances, I find that reinstatement is inappropriate.
Is an order for payment of compensation appropriate in all the circumstances of the case?
[81] Having found that reinstatement is inappropriate, it does not automatically follow that a
payment for compensation is appropriate. As noted by the Full Bench, “[t]he question whether
to order a remedy in a case where a dismissal has been found to be unfair remains a discretionary
one”.11
9 Nguyen v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter [2014]
FWCFB 7198, [17].
10 Smith v Moore Paragon Australia Ltd PR942856 (AIRCFB, Lawler VP, Kaufman SDP, Mansfield C, 20 January 2004),
[15].
11 Nguyen v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter [2014]
FWCFB 7198, [9].
[2022] FWC 501
16
[82] Where an applicant has suffered financial loss as a result of the dismissal, this may be a
relevant consideration in the exercise of this discretion.12
[83] I now deal with the issue of compensation.
Compensation - what must be taken into account in determining an amount?
[84] Section 392(2) of the FW Act requires all of the circumstances of the case to be taken
into account when determining an amount to be paid as compensation to the Applicant in lieu
of reinstatement including:
(a) the effect of the order on the viability of the Respondent’s enterprise;
(b) the length of the Applicant’s service;
(c) the remuneration that the Applicant would have received, or would have been likely
to receive, if the Applicant had not been dismissed;
(d) the efforts of the Applicant (if any) to mitigate the loss suffered by the Applicant
because of the dismissal;
(e) the amount of any remuneration earned by the Applicant from employment or other
work during the period between the dismissal and the making of the order for
compensation;
(f) the amount of any income reasonably likely to be so earned by the Applicant during
the period between the making of the order for compensation and the actual
compensation; and
(g) any other matter that the Commission considers relevant.
[85] I consider all the circumstances of the case below.
Section 392(2)(a) - effect of the order on the viability of the Respondent’s enterprise
[86] While I accept that the Respondent suffered adverse effects from the COVID-19
pandemic and its impacts, there is no evidence to suggest that an award of compensation would
have an effect on the viability of the Respondent’s enterprise.
Section 392(2)(b) - length of the Applicant’s service
[87] The Applicant’s length of service was approximately seven months. This is not a long
period of time. I consider that the Applicant’s very short period of service warrants reducing
the amount of any compensation ordered.
12 Vennix v Mayfield Childcare Ltd [2020] FWCFB 550, [20]; Jeffrey v IBM Australia Ltd [2015] FWCFB 4171, [5]-[7].
[2022] FWC 501
17
Section 392(2)(c) - remuneration that the Applicant would have received, or would have been
likely to receive, if the Applicant had not been dismissed
[88] As stated by a majority of the Full Court of the Federal Court, “[i]n determining the
remuneration that the Applicant would have received, or would have been likely to receive…
the Commission must address itself to the question whether, if the actual termination had not
occurred, the employment would have been likely to continue, or would have been terminated
at some time by another means. It is necessary for the Commission to make a finding of fact as
to the likelihood of a further termination, in order to be able to assess the amount of
remuneration the employee would have received, or would have been likely to receive, if there
had not been the actual termination.”13
[89] I am satisfied that, had the Respondent consulted with the Applicant in compliance with
the consultation provision of the Award, it still would have dismissed the Applicant and this
would have been fair in the circumstances.
[90] Had the Respondent undertaken such consultation, I find that this would have taken
place over approximately one week. As such, I find that the Applicant’s employment would
likely only have continued for a further period of one week and, had the Applicant been
working, the amount of remuneration that the Applicant would have received or would have
been likely to receive during that period is $1,292.00.
[91] However, in the circumstances of this matter, the Respondent had stood down its
workforce on account of public health orders and did not reopen until 11 October 2021, after
the Applicant was dismissed. Employees had been stood down during this period. As such, the
Applicant would not have been in receipt of any remuneration during this period.
Section 392(2)(d) - efforts of the Applicant to mitigate the loss suffered by the Applicant
because of the dismissal
[92] The Applicant must provide evidence that he has taken reasonable steps to minimise the
impact of the dismissal.14 What is reasonable depends on the circumstances of the case.15
[93] Having decided that the Applicant’s employment would have continued for an
additional week, I only need to consider the efforts made to mitigate the loss in this week. The
Applicant indicated he had been searching for employment and he was finding it difficult to
secure a role. I find that the Applicant had taken reasonable steps to minimise the impact of the
dismissal.
13 He v Lewin [2004] FCAFC 161, [58].
14 Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34], citing
Lockwood Security Products Pty Ltd v Sulocki and Ors PR908053 (AIRCFB, Giudice J, Lacy SDP, Blair C, 23 August
2001), [45].
15 Ibid, citing Payzu Ltd v Saunders [1919] 2 KB 581.
[2022] FWC 501
18
Section 392(2)(e) - amount of remuneration earned by the Applicant from employment or
other work during the period between the dismissal and the making of the order for
compensation
[94] The evidence does not establish that the Applicant earned any remuneration from
employment or other work in the week following his dismissal. The Applicant was paid one
weeks’ severance pay which constitutes remuneration and he would have received this same
payment following one weeks’ consultation, had it occurred.
Section 392(2)(f) - amount of income reasonably likely to be so earned by the Applicant
during the period between the making of the order for compensation and the actual
compensation
[95] This factor is not relevant in the circumstances of this matter.
Section 392(2)(g) - other relevant matters
[96] I do not consider there are any other relevant matters beyond those already addressed
above.
Compensation – how is the amount to be calculated?
[97] As noted by the Full Bench, “[t]he well-established approach to the assessment of
compensation under s.392 of the FW Act… is to apply the “Sprigg formula””, derived from the
Australian Industrial Relations Commission Full Bench decision in Sprigg v Paul’s Licensed
Festival Supermarket (Sprigg).16 This approach was articulated in the context of the FW Act in
Bowden v Ottrey Homes Cobram and District Retirement Villages.17
[98] The approach in Sprigg is as follows:
Step 1: Estimate the remuneration the employee would have received, or have been
likely to have received, if the employer had not terminated the employment
(remuneration lost).
Step 2: Deduct monies earned since termination. Workers’ compensation payments are
deducted but not social security payments. The failure of an applicant to mitigate his or
her loss may lead to a reduction in the amount of compensation ordered.
Step 3: Discount the remaining amount for contingencies.
Step 4: Calculate the impact of taxation to ensure that the employee receives the actual
amount he or she would have received if they had continued in their employment.
[99] I find that the Applicant would likely have remained in employment for a further period
of one week. This estimate of how long the Applicant would have remained in employment is
16 (1998) 88 IR 21.
17 [2013] FWCFB 431.
[2022] FWC 501
19
the “anticipated period of employment”.18 However, I also find that the Applicant would not
have earned any remuneration during the anticipated period of employment, as the Respondent
had stood down its workforce and did not recommence operations until 11 October 2021 in line
with public health orders. As such, there is no amount from which I can make adjustments for
the purposes of calculating compensation in accordance with the method above.
[100] Further, even if the Applicant had been entitled to earn his usual weekly pay during this
period of one week, I would have reduced this amount, noting the Applicant’s very short period
of service, including the period of stand down in which he was not working for the Respondent,
which would warrant reducing the amount of compensation ordered.
[101] In light of the above, I do not consider it appropriate in the circumstances of this matter
to order payment of compensation and decline to do so.
COMMISSIONER
Appearances:
Mr Z Bentley-Gates on his own behalf.
Ms M Annetts on behalf of the Respondent.
Hearing details:
2022.
Sydney (By Video Using Microsoft Teams).
January 10.
Printed by authority of the Commonwealth Government Printer
PR739091
18 Ellawala v Australian Postal Corporation Print S5109 (AIRCFB, Ross VP, Williams SDP, Gay C, 17 April 2000), [34].
E FAIR F THE FAIR WORK COMME SSION THE SEAL
