1
Fair Work Act 2009
s.394—Unfair dismissal
Bryan Nicholas Hartley
v
CPS NSW Pty Ltd
(U2024/8648)
COMMISSIONER CRAWFORD SYDNEY, 22 NOVEMBER 2024
Application for relief from unfair dismissal – whether genuine redundancy – whether
dismissal consistent with Small Business Fair Dismissal Code - dismissal unfair –
compensation ordered.
BACKGROUND
[1] CPS NSW Pty Ltd (CPS) operates a plumbing business. Bryan Hartley commenced
employment with CPS on around 15 March 2021 as a plumber. Mr Hartley was dismissed by
CPS on 8 July 2024. The reason for dismissal is in dispute. CPS says Mr Hartley’s position was
made redundant. Mr Hartley alleges he was dismissed because he had raised underpayment
issues. Mr Hartley filed an unfair dismissal application on 26 July 2024, which was within 21
days of his dismissal taking effect. Mr Hartley seeks compensation for what he says was an
unfair dismissal. CPS submits Mr Hartley’s dismissal was a case of genuine redundancy. CPS
also submits it had only 14 employees when Mr Hartley was dismissed, and that the dismissal
was consistent with the Small Business Fair Dismissal Code (SBFDC). CPS otherwise submits
the Mr Hartley’s dismissal was not unfair and that no compensation should be awarded.
[2] I issued directions for the filing of material and listed a determinative
conference/hearing on 13 November 2024 in person. I granted permission for Mr Hartley to be
represented by Daniel Garan from Berrigan Doube Lawyers on the basis that would enable the
matter to be dealt with more efficiently. This was not opposed by CPS. CPS was represented
by Alexandra Gray (Director) and her husband, Christopher Gray (Operations Manager). I
heard from the parties about whether the proceeding should be conducted as a hearing or a
determinative conference. I decided it was appropriate to conduct a hearing.
EVIDENCE
Mr Hartley
[3] Mr Hartley provided a witness statement dated 27 September 2024 containing his
evidence about the relevant events.
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DECISION
AUSTRALIA FairWork Commission
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[4] Mr Hartley states he had no performance issues during his employment with CPS and
had not been advised that his role was at risk of being made redundant prior to 8 July 2024. Mr
Hartley states he was working on a worksite in North Sydney prior to his dismissal and that the
job had not been completed when he was dismissed on 8 July 2024. Mr Hartley was assigned
to work at various residential and commercial worksites during his employment with CPS.
[5] Mr Hartley says he started raising concerns about superannuation contributions with
Noah Wright (Supervisor) in March 2024. Mr Hartley states Mr Wright attended the North
Sydney worksite on about 20 June 2024 and took the four CPS staff members for a coffee. Mr
Wright enquired about whether CPS had been making superannuation contributions and the
employees indicated contributions had not been made. Mr Wright stated he would get back to
the employees.
[6] Mr Hartley attended a Plumbers’ Union meeting in Alexandria on 1 July 2024. During
the meeting the workers in attendance voted in support of a new enterprise agreement and
elected Mr Wright as their delegate. The employees also raised underpayment concerns and
were provided with a form to complete and submit back to the union. After the meeting Mr
Hartley says he stated to other workers on the street that he thinks he is owed around $20,000
and that all employees should submit their claims to the union.
[7] Mr Hartley states he missed a phone call from Mr Gray on 3 July 2024 while he was
working. Mr Hartley says he called Mr Gray back and Mr Gray indicated he would give Mr
Hartley cash if he was in financial hardship. Mr Hartley says he indicated he would not accept
a cash payment and that it had to go “through the right channels.” Mr Hartley states Mr Gray
did not specifically refer to his alleged underpayment claims during the call, but he suspected
that was why Mr Gray made contact.
[8] Mr Hartley says he spoke with Mr Wright about the phone call during his lunch break
and that when he explained what had been said Mr Wright stated Mr Gray “is just not getting
it.”
[9] Mr Hartley says Mr Wright sent a text message to the CPS employees on 3 July 2024
inviting employees who had attended the union meeting on 1 July 2024 to submit their
underpayment form to him. Mr Hartley sent a form via text message to Mr Wright on 4 July
2024 which claimed he was owed a total of around $24,000 for superannuation, travel
allowance, and redundancy contributions to IncoLink. Mr Hartley provided screenshots of the
relevant text messages and screenshots of the form that he submitted to Mr Wright.
[10] Mr Hartley states he attended the North Sydney worksite on 8 July 2024 and started
working. Jack Pritchard (Leading Hand) then approached him and stated: “both our names are
not on the board” and indicated he would call Mr Gray to discuss why. Around 15 minutes later,
Mr Pritchard told Mr Hartley that he had been made redundant. After hearing this from Mr
Pritchard, Mr Hartley immediately sent a text message to Mr Gray asking if he was in the same
situation as Mr Pritchard. Mr Hartley provided a screenshot of this text message. Mr Gray
subsequently called Mr Hartley. Mr Hartley asked if he was in the same situation as Mr
Pritchard and alleges that Mr Gray stated: “It’s best to pull the pin.” Mr Hartley asked if his last
day of work is today, and Mr Gray stated: “yes.”
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[11] Mr Hartley states he understood CPS had employees working on at least nine different
projects at the time of his dismissal.
[12] Mr Hartley provided evidence about challenging personal and financial circumstances.
Mr Hartley also provided evidence that he was suffering from an infected ingrown toenail from
13 July 2024 to 2 August 2024 and provided a medical certificate to confirm the condition. Mr
Hartley states he was actively looking for work on employment websites after being dismissed
and commenced employment with Jennings Plumbing Services on 2 September 2024. Mr
Hartley’s rate of pay in the new employment is the same as that he received from CPS.
[13] I marked Mr Hartley’s statement Exhibit A1. Mr Hartley’s evidence was not challenged
in cross-examination by CPS.
CPS
[14] Ms Gray provided a submission containing evidence about CPS’ version of events dated
18 October 2024.
[15] Ms Gray states CPS currently employs 12 staff including herself and her husband. Ms
Gray states Mr Hartley was dismissed due to no work being available and that he was informed
work was running low prior to being dismissed. Ms Gray states Mr Hartley was informed that
he was a daily hire employee when he commenced employment with CPS in March 2021.
[16] Ms Gray states she and her husband met with employees onsite on 25 June 2024 and
advised employees that things were “tight.” An impending new enterprise agreement was
discussed. Ms Gray raised concerns about union fees under the new agreement.
[17] Ms Gray states a union meeting was held on 1 July 2024 and the employees unanimously
endorsed the new enterprise agreement. Ms Gray met with an accountant and financial advisor
on 4 July 2024 to discuss the financial impacts of the new agreement and states a decision was
made to let some employees go. The workers picked were those working on a project at North
Sydney because that job was coming to an end, with only rectifications remaining.
[18] Ms Gray states Mr Hartley contacted Mr Wright on 5 July 2024 to advise that he would
not be attending work on that date.
[19] Ms Gray states Mr Hartley attended work on 8 July 2024 without notifying supervisors
or management that he was returning to work. Ms Gray states Mr Hartley was then informed
during a phone call that unfortunately there was no longer work available and he would be given
until the end of the day to pack up his tools. Mr Hartley’s final pay and leave entitlements were
processed on 8 July 2024.
[20] Ms Gray gives evidence about the intermittent nature of work in the construction
industry and that CPS has not employed anyone since Mr Hartley was dismissed. Ms Gray
refers to Mr Hartley being able to access redundancy payments through IncoLink.
[21] I marked the document provided by Ms Gray as Exhibit R1. Ms Gray was cross-
examined during the hearing on 13 November 2024.
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Mr Hartley
[22] Mr Hartley provided a reply witness statement dated 24 October 2024.
[23] Mr Hartley disputed Ms Gray’s evidence about the number of employees engaged by
CPS and states there were 17 employees when he was dismissed. Mr Hartley denies being told
work was “running low” and denies being informed he was a daily hire employee. Mr Hartley
denies Ms Gray told employees: “things were tight” when she attended the worksite but
accepted a meeting was held where CPS’ concerns about the union fees in the new agreement
were raised.
[24] Mr Hartley states he advised Mr Wright that he could not attend work on 5 July 2024
because his daughter was unwell but stated he gave no indication that he would not be working
the following week.
[25] Mr Hartley denies he has been paid all outstanding entitlements by CPS and states he is
still owed superannuation, redundancy pay, and travel allowance.
[26] I marked Mr Hartley’s reply statement Exhibit A2. Mr Hartley’s reply evidence was
not challenged in cross-examination by CPS.
CONSIDERATION – INITIAL MATTERS
Dismissal and eligibility to make the application
[27] I am satisfied that Mr Hartley was dismissed at the initiative of CPS on 8 July 2024.
[28] I am satisfied Mr Hartley was a person protected from unfair dismissal because:
• Mr Hartley had completed more than three years of service at the time of his dismissal;
and
• The CPS NSW Pty Ltd & CEPU Plumbing Division – NSW Branch Mechanical
Enterprise Agreement 2019 – 2023 (2019 Agreement) covered and applied to Mr
Hartley’s employment with CPS until his dismissal on 8 July 2024. The CPS NSW Pty
Ltd and CPEU Plumbing Division NSW Branch Mechanical (HVAC) Enterprise
Agreement 2023 – 2027 (2023 Agreement) was not approved by the Commission
until 18 July 2024 and it commenced operating on 25 July 2024. The 2023 Agreement
never covered or applied to Mr Hartley because he was dismissed before it
commenced operating.
[29] I am required to consider CPS’ argument that Mr Hartley’s dismissal was a case of
genuine redundancy before I assess the merits of Mr Hartley’s application. If I do not find Mr
Hartley’s dismissal was a case of genuine redundancy I am required to then consider whether
Mr Hartley’s dismissal was consistent with the SBFDC, if I determine that CPS had less than
15 employees when Mr Hartley was dismissed. If the SBFDC applied and Mr Hartley’s
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dismissal was not consistent with the SBFDC, I can then assess the merits of Mr Hartley’s
application.1
Genuine redundancy
[30] There are three matters that need to be considered to determine whether the definition
of a “genuine redundancy” is satisfied in relation to a dismissal.2
[31] Firstly, it must be established that CPS no longer required Mr Hartley’s job to be
performed by anyone because of changes to its operational requirements. I am prepared to
accept on the limited evidence provided by CPS that this element has been satisfied. Ms Gray
provided evidence that CPS had 12 employees when she signed CPS’ submissions on 18
October 2024. The evidence of Mr Hartley and Ms Gray indicates CPS had a higher number of
employees remaining after Mr Hartley and Mr Pritchard were dismissed. That suggests Mr
Hartley has not been replaced and that CPS no longer required as many plumbers as it had
employed prior to Mr Hartley’s dismissal.
[32] Secondly, it must be established that CPS complied with the consultation obligations in
clause 43 of the 2019 Agreement. I consider it is clear this element has not been satisfied. Ms
Gray’s evidence suggests that the increased costs arising from the imminent operation of the
2023 Agreement was the reason for CPS’ decision to reduce the number of plumbers it
employed. That is clearly a change to the organisation or structure of CPS and falls within
clause 43.1 of the 2019 Agreement. The change clearly had a significant effect on the
employees within the meaning of clause 43.9 of the 2019 Agreement because it resulted in the
dismissal of Mr Hartley and Mr Pritchard. That means the consultation obligations in clauses
43.2, 43.3, 43.5, and 43.7 of the 2019 Agreement were triggered. I do not consider CPS
complied with any of these obligations. The uncontested evidence is that Mr Hartley’s name
was removed from a board listing people working on 8 July 2024, followed by Mr Gray telling
Mr Hartley in a phone call that “it’s best to pull the pin” and that it was Mr Hartley’s last day.
That is not the consultation process required under clause 43 of the 2019 Agreement. This
finding means Mr Hartley’s dismissal does not meet the definition of a “genuine redundancy.”
[33] For completeness, I would also not conclude on the evidence that it was not reasonable
for Mr Hartley to be redeployed. Mr Hartley was not cross-examined on his evidence that CPS
had employees working on at least nine projects at the time of his dismissal. Ms Gray disputed
this during her cross-examination but did not provide clear and definitive evidence about the
number of projects. It is also conceivable that if a proper process had been followed, other
plumbers may have been prepared to take a voluntary redundancy allowing Mr Hartley to
remain employed. There is insufficient evidence to properly determine if it would have
reasonable for Mr Hartley to be redeployed.
Small Business Fair Dismissal Code
[34] I am marginally satisfied on the evidence that CPS had less than 15 employees when Mr
Hartley was dismissed. Ms Gray has maintained this and she presented as a credible witness
during the hearing. I do not consider the list of names provided in Mr Hartley’s witness
statement to be sufficient evidence to conclude that CPS had 15 or more employees. My finding
means I must consider whether the dismissal was consistent with the SBFDC.
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[35] Mr Hartley submitted CPS failed to comply “with question 3 of the Code.” However,
that appears to be a reference to a checklist produced to assist parties, rather than the actual
SBFDC.3
[36] In any event, the SBFDC states: “in discussions with an employee in circumstances
where dismissal is possible, the employee can have another person present to assist.” I take this
to mean that the SBFDC requires discussions to occur with an employee prior to the final
dismissal decision being made and the employee can have a person present to assist in the
discussions. CPS did not have any discussions with Mr Hartley prior to his name being removed
from the “board” identifying its employees. Mr Hartley had to actively contact Mr Gray to find
out what had happened. There were no discussions and the opportunity to have a person present
to assist did not arise.
[37] I find that Mr Hartley’s dismissal was not consistent with the SBFDC because of the
severely defective procedure CPS followed when terminating Mr Hartley’s employment.
CONSIDERATION - HARSH, UNJUST, OR UNREASONABLE
[38] I have found that Mr Hartley’s dismissal was not a case of “genuine redundancy” and
that the dismissal was not consistent with the SBFDC. That means I must proceed to determine
whether Mr Hartley’s dismissal was harsh, unjust, or unreasonable taking into account the
factors listed in s.387 of the FW Act. Each factor is dealt with below.
Valid reason
[39] In order to be a valid reason, the reason for the dismissal should be “sound, defensible
or well founded”4 and should not be “capricious, fanciful, spiteful or prejudiced.”5 However,
the Commission will not stand in the shoes of the employer and determine what the Commission
would do if it was in the position of the employer.6
[40] Although CPS provided minimal evidence regarding why Mr Hartley was dismissed, I
accept on balance that there was a valid reason for his dismissal. I accept Ms Gray’s evidence
that the increased costs that would arise from the 2023 Agreement triggered the decision to
reduce the headcount of employees. I consider that was a valid reason for the dismissal.
Notification of the reason for dismissal
[41] Proper consideration of s.387(b) requires a finding to be made as to whether Mr Hartley
“was notified of that reason.” Contextually, the reference to “that reason” is the valid reason
found to exist under s.387(a).7
[42] Notification of a valid reason for termination must be given to an employee protected
from unfair dismissal before the decision is made to terminate their employment,8 and in
explicit9 and plain and clear terms.10
[43] I consider it is clear CPS did not notify Mr Hartley of the reason for his dismissal prior
to making the decision to terminate his employment. Mr Hartley’s name was simply removed
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from a board listing CPS’ employees. Mr Hartley had to contact Mr Gray to find out what had
occurred. Mr Hartley was not afforded any degree of procedural fairness.
Opportunity to respond
[44] An employee protected from unfair dismissal should be provided with an opportunity
to respond to any reason for their dismissal relating to their conduct or capacity. An opportunity
to respond is to be provided before a decision is taken to terminate the employee’s
employment.11
[45] The opportunity to respond does not require formality and this factor is to be applied in
a common-sense way to ensure the employee is treated fairly.12 Where the employee is aware
of the precise nature of the employer’s concern about his or her conduct or performance and
has a full opportunity to respond to this concern, this is enough to satisfy the requirements.13
[46] I consider it is clear CPS did not provide Mr Hartley with an opportunity to respond to
the reason for his dismissal prior to making the decision to terminate his employment. Mr
Hartley’s name was simply removed from a board listing CPS’ employees. Mr Hartley had to
contact Mr Gray to find out what had occurred. Mr Hartley was not afforded any degree of
procedural fairness.
Unreasonable refusal to have a support person present to assist at discussions
[47] Given there were no discussions between CPS and Mr Hartley about the dismissal, I
consider this is a neutral factor.
Warnings about unsatisfactory performance
[48] This factor is not relevant to the present circumstances because Mr Hartley was not
dismissed for unsatisfactory performance.
To what degree would the size of CPS’ enterprise be likely to impact on the procedures
followed
[49] I accept CPS is a very small business and that this had an impact on the defective
procedures followed in effecting the dismissal.
To what degree would the absence of dedicated human resource management specialists or
expertise in CPS’ enterprise be likely to impact on the procedures followed
[50] I find that a lack of dedicated human resource management specialists contributed to a
significant degree to the defects in the procedures followed by CPS in effecting the dismissal.
Other relevant matters
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[51] I consider there are other relevant matters of importance in this case.
[52] Mr Hartley’s evidence that Mr Gray had offered to make a cash payment to satisfy his
underpayment issues was not contested by CPS. I say that because Mr Hartley was not cross-
examined on his evidence and Mr Gray did not provide a witness statement disputing that the
conversion occurred. That suggests that Mr Hartley’s underpayment claim may have been a
factor in why he was selected as one of the plumbers to be made redundant. I consider this is a
matter that weighs in favour of finding Mr Hartley’s dismissal was unfair.
[53] I also consider it is relevant that Mr Hartley was dismissed on Monday, 8 July 2024
after being absent on Friday, 5 July 2024 to care for his unwell daughter. Mr Hartley’s evidence
about this absence was not contested by CPS via cross-examination. I find Ms Gray’s criticism
in her submission of Mr Hartley attending the North Sydney site on Monday, 8 July 2024
“without notifying supervisors or management” to be completely unfounded. Although Mr
Hartley was a daily hire employee under the 2019 Agreement, he had been working on a full-
time basis for over three years. There was no basis for CPS to assume Mr Hartley would not be
attending work on Monday, 8 July 2024 simply because his daughter was unwell on Friday, 5
July 2024. To the contrary, CPS should have assumed Mr Hartley would be attending work on
the Monday, 8 July 2024 unless Mr Hartley contacted them again to say that his absence would
extend beyond Friday, 5 July 2024. I consider this is a matter that weighs in favour of finding
Mr Hartley’s dismissal was unfair.
[54] I have considered Mr Hartley’s evidence about his personal circumstances and accept
he is dealing with some challenging issues. However, I do not consider these challenges are
quite to the extent where they should be taken into account as an “other relevant matter.”
CONCLUSION - HARSH, UNJUST OR UNREASONABLE
[55] I have made findings in relation to each matter specified in s.387. I must consider and
give due weight to each as a fundamental element in determining whether the termination was
harsh, unjust or unreasonable.14
[56] Having considered each of the matters specified in s.387 of the FW Act, I am satisfied
that the dismissal of Mr Hartley was harsh, unjust, and unreasonable. Although I have found
there was a valid reason for Mr Hartley’s dismissal associated with CPS needing to reduce its
employment costs, Mr Hartley was denied any semblance of procedural fairness. The other
relevant matters I have identified above also trouble me, and I consider it is highly likely CPS
would have handled the matter differently if Mr Hartley had not raised underpayment issues.
This weighs strongly in favour of finding that Mr Hartley was unfairly dismissed. I
acknowledge CPS is a small business without human resource specialists and ordinarily that
would mitigate the severity of the procedural fairness issues I have identified. However, given
my findings above, I conclude that the main reason for the procedural fairness deficiencies was
not the size of CPS or its lack of human resource specialists. I consider Mr Hartley’s
underpayment claim was the main contributing factor.
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[57] I am satisfied that Mr Hartley was unfairly dismissed within the meaning of s.385 of the
FW Act.
REMEDY
Is reinstatement of Mr Hartley inappropriate?
[58] Mr Hartley does not seek reinstatement on the basis that the employment relationship
has been irreparably damaged. I agree with this position and find that reinstatement is
inappropriate.
Is an order for payment of compensation appropriate in all the circumstances of the
case?
[59] 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…”15
[60] 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.16
[61] Mr Hartley has suffered financial loss in circumstances where I have found he was
unfairly dismissed. In all the circumstances, I consider that an order for payment of
compensation is appropriate.
Consideration – compensation
Effect of the order on the viability of CPS’ enterprise
[62] I accept Ms Gray’s evidence that CPS is struggling to meet its financial obligations. Ms
Gray confirmed that CPS is three months behind in payments to IncoLink and that it recently
fell behind in making superannuation contributions. I consider this factor weighs in favour of a
lower compensation order.
Length of service
[63] Mr Hartley was what I would call a “mid-term employee” with around three years and
four months of service with CPS. I consider this is a neutral factor.
Remuneration that would have been received, or would have been likely to be received
[64] As stated by a majority of the Full Court of the Federal Court, “[i]n determining the
remuneration that the employee 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
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remuneration the employee would have received, or would have been likely to receive, if there
had not been the actual termination.”17 This is referred to as the “anticipated period of
employment.”
[65] I have found it difficult in this case to assess how long Mr Hartley would have remained
employed by CPS if he was not unfairly dismissed on 8 July 2024. I consider the following
factors are relevant:
• Although Mr Hartley worked full-time hours continuously since 2021, the 2019
Agreement states any employee not specifically identified as a casual employee will
be a daily hire employee. I consider Mr Hartley was engaged as a daily hire employee,
even if this was never made clear to him by CPS. That means Mr Hartley had less
employment security than a permanent employee.
• I have accepted CPS is facing financial difficulties and that this was the reason it
wanted to reduce its employee headcount. This increases the risk of an employee being
made redundant by CPS.
• There is no evidence of performance or conduct issues in relation to Mr Hartley’s
employment.
• There is no evidence Mr Hartley intended to resign from his employment with CPS in
the near future.
[66] I find that the “anticipated period of employment” is six months, or until 8 January 2024.
I consider this period strikes an appropriate balance based on the various factors identified
above. Based on his salary rate of $101,256.00 with CPS, Mr Hartley would have earned
$50,628.00 gross plus superannuation if he remained employed with CPS from 8 July 2024 to
8 January 2024.
Efforts to mitigate loss
[67] Mr Hartley must provide evidence that he has taken reasonable steps to minimise the
impact of the dismissal.18 What is reasonable depends on the circumstances of the case.19
[68] Mr Hartley provided unchallenged evidence that he searched for work after being
dismissed and that an injured toe made this more difficult than usual. Mr Hartley commenced
employment with Jennings Plumbing Services on 2 September 2024. That was around two
months after his dismissal.
[69] I am satisfied Mr Hartley has made considerable efforts to mitigate his loss. I do not
consider any deduction should be made for failure to mitigate loss.
Amounts earned from employment or other work during the anticipated period of
employment
[70] Mr Hartley’s annual salary rate with Jennings Plumbing Services is $101,256.48 or
$8,438.04 per month.
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[71] There is no evidence to suggest that Mr Hartley is likely to cease working for Jennings
Plumbing Services prior to the anticipated period of employment ending on 8 January 2024.
[72] I find the total amount Mr Hartley has earned and is likely to earn during the anticipated
period of employment is $33,752.16 gross plus superannuation.
Amount of income reasonably likely to be earned between the making of the order for
compensation and the actual compensation
[73] Mr Hartley is reasonably likely to continue earning around $1,947.24 per week plus
superannuation through his employment with Jennings Plumbing Services during the period
between the making of the compensation order and the compensation being paid.
Other relevant matters
[74] Neither party submitted that there were any other relevant matters.
Compensation – how is the amount to be calculated?
[75] 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).20 This approach was articulated in the context of the FW Act in
Bowden v Ottrey Homes Cobram and District Retirement Villages21.”22
[76] 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 to mitigate 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.
Step 1
[77] I have estimated that Mr Hartley would have earned $50,628.00 gross plus
superannuation between his dismissal on 8 July 2024 and the end of the anticipated period of
employment with CPS on 8 January 2024.
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Step 2
[78] Only monies earned since termination for the anticipated period of employment are to
be deducted.23
[79] I have calculated Mr Hartley has earned and is likely to earn a total of $33,752.16 gross
plus superannuation during the anticipated period of employment.
[80] An amount of $16,875.84 gross plus superannuation remains after the earnings and
expected earnings are deducted.
[81] For the reasons outlined above, I have not applied a deduction because Mr Hartley has
taken significant steps to mitigate his loss.
[82] I consider it is appropriate to make a deduction of 20% to the compensation amount
because of my concerns about the impact of an order of $16,875.84 plus superannuation on the
viability of CPS. That leaves an amount of $13,500.67 plus superannuation.
Step 3
[83] I now need to consider the impact of contingencies on the amounts likely to be earned
by Mr Hartley for the remainder of the anticipated period of employment.24 It appears Mr
Hartley has been working full-time hours in his employment with Jennings Plumbing Services
from 2 September 2024 until when the application was heard on 13 November 2024. Given the
stability in Mr Hartley’s earnings, I do not consider it is necessary to make a deduction for
contingencies.
Step 4
[84] I have considered the impact of taxation but have elected to settle a gross amount of
$13,500.67 plus superannuation of $1,552.57 and leave taxation for determination.
Compensation – is the amount to be reduced on account of misconduct?
[85] Mr Hartley was not dismissed for misconduct and no deduction for misconduct is
appropriate.
Compensation – how does the compensation cap apply?
[86] Section 392(5) of the FW Act provides that the amount of compensation ordered by the
Commission must not exceed the lesser of:
(a) the amount worked out under s.392(6); and
(b) half the amount of the high income threshold immediately before the dismissal.
[87] Section 392(6) of the FW Act provides:
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(6) The amount is the total of the following amounts:
(a) the total amount of remuneration:
(i) received by the person; or
(ii) to which the person was entitled;
(whichever is higher) for any period of employment with the employer during
the 26 weeks immediately before the dismissal…
[88] Given Mr Hartley’s annual salary of $101,256.00 a compensation cap of $50,628.00
plus superannuation applies in accordance with s.392(6) of the FW Act.
Conclusion – compensation
[89] Having applied the formula in Sprigg, I am nevertheless required to ensure that “the
level of compensation is an amount that is considered appropriate having regard to all the
circumstances of the case.”25
[90] The application of the Sprigg formula and the 20% deduction due to my concerns about
the viability of CPS has resulted in an outcome where Mr Hartley would be awarded
compensation of $13,500.67 plus superannuation of $1,552.57.
[91] I am satisfied that the amount of compensation that I have determined above takes into
account all the circumstances of the case as required by s.392(2) of the FW Act.
Compensation order
[92] Given my findings above, I will make an order that CPS must pay Mr Hartley
$13,500.67 less taxation as required by law, plus superannuation of $1,552.57 to be paid into
Mr Hartley’s nominated fund, with both payments to be made within 28 days of the date of this
decision.
COMMISSIONER
MISSION COM THE SEAL WORK
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Appearances:
Mr Garan representing Mr Hartley.
Ms Gray and Mr Gray on behalf of CPS.
Hearing details:
2024.
Sydney.
13 November.
Printed by authority of the Commonwealth Government Printer
PR781522
1 Fair Work Act 2009 (Cth), s 396.
2 Ibid, s 389.
3 Federal Register of Legislation - Fair Work Act 2009 - Declaration under subsection 388(1) - Small Business Fair Dismissal
Code.
4 Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373.
5 See ibid.
6 Walton v Mermaid Dry Cleaners Pty Ltd (1996) 142 ALR 681, 685.
7 Bartlett v Ingleburn Bus Services Pty Ltd [2020] FWCFB 6429, [19]; Reseigh v Stegbar Pty Ltd [2020] FWCFB 533, [55].
8 Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, 151.
9 Previsic v Australian Quarantine Inspection Services Print Q3730 (AIRC, Holmes C, 6 October 1998).
10 See ibid.
11 Crozier v Palazzo Corporation Pty Ltd t/a Noble Park Storage and Transport Print S5897 (AIRCFB, Ross VP, Acton
SDP, Cribb C, 11 May 2000), [75].
12 RMIT v Asher (2010) 194 IR 1, 14-15.
13 Gibson v Bosmac Pty Ltd (1995) 60 IR 1, 7.
14 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].
15 Nguyen v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter [2014]
FWCFB 7198, [9].
16 Vennix v Mayfield Childcare Ltd [2020] FWCFB 550, [20]; Jeffrey v IBM Australia Ltd [2015] FWCFB 4171, [5]-[7].
17 He v Lewin [2004] FCAFC 161, [58].
https://www.legislation.gov.au/F2009L02570/latest/downloads
https://www.legislation.gov.au/F2009L02570/latest/downloads
http://www.fwa.gov.au/documents/Benchbookresources/unfairdismissals/Walton_v_Mermaid_Dry_Cleaners.pdf
https://www.fwc.gov.au/documents/decisionssigned/html/2020fwcfb6429.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2020fwcfb533.htm
https://www.fwc.gov.au/documents/decisionssigned/html/pr915674.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2014fwcfb7198.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2014fwcfb7198.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2020fwcfb550.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2015fwcfb4171.htm
[2024] FWC 3227
15
18 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].
19 Biviano v Suji Kim Collection PR915963 (AIRCFB, Ross VP, O’Callaghan SDP, Foggo C, 28 March 2002), [34] citing
Payzu Ltd v Saunders [1919] 2 KB 581.
20 (1998) 88 IR 21.
21 [2013] FWCFB 431.
22 Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries [2016] FWCFB 7206, [16].
23 See ibid.
24 Enhance Systems Pty Ltd v Cox PR910779 (AIRCFB, Williams SDP, Acton SDP, Gay C, 31 October 2001), [39].
25 Double N Equipment Hire Pty Ltd t/a A1 Distributions v Humphries [2016] FWCFB 7206, [17].
https://www.fwc.gov.au/documents/decisionssigned/html/pr915963.htm
https://www.fwc.gov.au/documents/decisionssigned/html/pr908053.htm
https://www.fwc.gov.au/documents/decisionssigned/html/pr915963.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2013fwcfb431.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2016fwcfb7206.htm
https://www.fwc.gov.au/documents/decisionssigned/html/pr910779.htm
https://www.fwc.gov.au/documents/decisionssigned/html/2016fwcfb7206.htm
