Fair Work Act 2009
s 394 - Application for unfair dismissal remedy

Marrianne Reid
v
itac2 Pty Ltd t/as itac2
(U2014/4744)

Termination of employment - whether applicant resigned or was dismissed - heated verbal exchange between respondent and applicant - applicant dismissed - admissions of unfairness - no valid reason for dismissal - dismissal substantively and procedurally unfair - reinstatement inappropriate - compensation ordered.

[1] Ms Marrianne Reid (the ‘applicant’) was employed by itac2 Pty Ltd t/as itac2 (the ‘respondent’) from 1 March 2011 until 10 February 2014. The respondent claimed the applicant was employed under the Clerks - Private Sector Award 2010 [MA000002] (the ‘Award’). Her salary as a permanent part time employee at the relevant time was $31,200 per annum.

[2] On 18 February 2014, the applicant filed an application, pursuant to s 394 of the Fair Work Act 2009 (the ‘Act’), seeking a remedy from her alleged unfair dismissal. The applicant claims that she was dismissed during a heated verbal exchange with the respondent’s sole director, Mr Warren Gamble on 11 February 2014. The respondent objected that the Fair Work Commission (the ‘Commission’) has no jurisdiction to deal with this matter on the basis that applicant resigned her employment and was not dismissed from her position, or at all. The circumstances surrounding the events leading up to, and including 11 and 12 February 2014, will be the focus of findings as to whether the respondent’s jurisdictional objection is made out.

[3] At this point, I do not apprehend there to be any other jurisdictional objections which would otherwise prevent the application proceeding to arbitration, in that I am satisfied that:

(a) the application was filed within the 21 day time limit (s 396(a));

(b) the applicant was covered by a Modern Award (s 382(b)(i);

(c) the dismissal was not a case of genuine redundancy (s 396(d));

(d) the applicant earned less than the high income threshold (s 382(b)(iii);

(e) the respondent has served the minimum employment period (2 ½ years) (s 382(a)); and

(f) the respondent is a small business, as defined (ss 23 and 396(c)).

[4] Thus, two matters fall for consideration in this case. Firstly, was the applicant dismissed or did she resign and, secondly, if it was the former, was her dismissal ‘harsh, unjust or unreasonable’ within the meaning of s 387 of the Act.

THE EVIDENCE

[5] The following persons provided written and/or oral testimony in the proceeding:

For the applicant

• The applicant;
• Mr Michael Campbell, Company Secretary, Massereene Trading Company Pty Ltd; and
• Ms Lisa Deen, a friend of the applicant and a HR professional.

For the respondent

• Mr Warren Gamble, Director of itac2 Pty Ltd; and
• Mr William Egan, Factory Hand for itac2 Pty Ltd.

The applicant

[6] In her written statement, the applicant explained her unusual work arrangements with the respondent. She had ‘contracted’ with Mr Gamble on 1 March 2010 to work on accounts for a number of his companies. She worked four days per week and was paid $25 per hour. Subsequently, Mr Gamble asked her to work five days per week, but claimed that he could only pay her for four days. In return, he promised her 5% of one of his companies and a salary package, once the businesses became more viable.

[7] The applicant deposed that in July 2011, Mr Gamble had suggested that she be ‘employed’ three days per week and contract as a Market Consultant at $25 per hour for the other two days. This would enable Mr Gamble to claim 50% on an Export Marketing Development Grant (‘EDMG’). The applicant referred to a document purporting to be a contract, which Mr Gamble had promised to sign later. On 1 July 2012, Mr Gamble had suggested that this arrangement should continue. The applicant had some concerns as to the Australian Tax Office’s (ATO) rules on employees and contractors. However, she negotiated her ‘contracted’ Marketing Consultant hourly rate from $25 per hour to $35 per hour. Mr Gamble again said he would sign a contract once he could commit to a proper salary package. He wanted to continue with this arrangement in July 2013. The applicant left a copy of the contract on his desk, but it ‘disappeared’. She said that Mr Gamble ‘deferred my employment contract until November 2013 promoting me to General Manager until he could complete the employment contract.’

[8] The applicant referred to an incident on 20 October 2013, when Mr Gamble had phoned her outside of work hours while she was with a friend and ‘ordered’ her to meet him at the office. She replied that she could not do so. Mr Gamble had complained about how hard he was working and how he expected her to ‘step up’. The applicant was surprised at this complaint and challenged Mr Gamble as to whether he believed she worked hard enough. He responded that he thought she did. When she called him again later at home, he was apologetic. At this point, the applicant decided to ‘resign’ from the market consultancy. Mr Gamble accepted the notice she gave him the following day and said he would offer her an employment contract on 20 January 2014. He also gave her flowers, a lotto ticket and treated her to a ‘high tea’ at the RACV resort. When she approached him again on 20 January 2014, he had told her that they had agreed to deal with the issue in March 2014.

[9] The applicant said that Mr Gamble offered the ‘Market Consultant’ role to a Ms Janine Broben, again intending to claim part of her pay on the EDMG Grant. Mr Gamble had checked the relevant Award, as he was unhappy at the prospect of paying Ms Broben $28 per hour. He felt she should be paid $19.95 per hour. At the same time, he checked what the applicant should be paid and found it was $100,000. Mr Gamble expressed discomfort at this and said he would prefer the applicant to set up her own company. The applicant responded that this was not possible, as she was deemed to be an employee by the ATO.

[10] The applicant set out a number of incidents at work which she believed were relevant to the dispute she had with the respondent. These included:

• working 6 weekends in a row, in or around September 2011, to complete a successful EDMG grant application;
• assisting Mr Gamble’s wife with a letter for his daughter to be accepted to Silkwood School;
• an injury sustained from lifting a box at work, for which she did not seek workers’ compensation benefits;
• unparticularised incidents of Mr Gamble making ‘odd’ comments and his generally erratic and aggressive behaviour;
• dealing with angry customers;
• the vandalism of her car;
• Mr Gamble’s disputes with employees, other businesses and other people in the complex; and
• numerous complaints of being underpaid and of unpaid entitlements.

[11] The applicant claimed that she was hardworking, loyal and professional throughout her employment and denied she was ever unprofessional or abusive. She referred to the allegation of ‘trying to extort money from a company’ and said she had sent an invoice to Telecom and Bayer for $10,000 for time and stress incurred from a false outstanding debt. It was Mr Gamble who had suggested doing this and she accepted she had prepared it in work time.

[12] The applicant said that she had Mr Gamble’s permission to call the real estate agent in New Zealand twice on the work phone when she sold her house. Otherwise, she would use a free internet phone service. The applicant denied using the MYOB system for work for her other clients or having any ‘issue’ with the ATO, though there was some misunderstanding about her PAYG. This was in the process of being resolved.

[13] The applicant explained that in February 2013, she was owed approximately $14,500 in wages. She had approached Mr Gamble, as she needed a new car. Mr Gamble arranged for a car to be brought to her for a test drive and he suggested she buy it on finance. She declined to do so, as she would be able to purchase it outright if she had been paid her outstanding wages. Mr Gamble eventually agreed to purchase the car himself, on finance. They came to an arrangement under which he paid her approximately $6,000 over a few months, deducted $7,500 from the wages owed and used the $1,000 trade in from her old car.

The incident

[14] The applicant said that on Tuesday 11 February 2014, after arriving for work at 9:00am, Mr Gamble asked her to have six items ready for discussion at a 1:00pm meeting. They finished their morning meeting at 9:30am. Mr Gamble continued to talk about unrelated topics while the applicant responded to emails until approximately 10:15am. At 10:20am, Mr Gamble suddenly told the applicant that he wanted the wholesale website (an additional item) completed ‘now’. As she got up to get the relevant folder, she responded that she thought her priority was to get the relevant six issues ready for their meeting at 1:00pm. She told him it was incumbent on him to set out the priorities. Mr Gamble then told her to ‘Fuck off’’. The applicant complained about being spoken to in this manner. Mr Gamble threw up his hands, clipping her over the shoulder and told her to ‘Just fuck off and get out’. The applicant said she was frightened at Mr Gamble’s aggressive manner and left the office. As she stood outside the screen door, she asked him whether she was sacked. However, she left before his response in order to wait for him to calm down. The applicant denied that Mr Egan had witnessed this incident or was even in the office that day.

[15] The applicant explained that Mr Gamble left a voicemail message on 12 February 2014 asking her to come in to ‘finalise things’. He asked for the MYOB password. However, she claimed that there was no MYOB password. The applicant went in to the office at 10:30am, as she knew that Ms Broben would be there. She was still concerned at Mr Gamble’s behaviour. Mr Gamble took the keys from her and said he would finalise things with her the following week, as his daughter was ill. When he asked for the car back, she responded that she would give it back when he paid her the $8,500 she was owed. Mr Gamble agreed to this. She denied saying that she had to hurry to attend a job interview or that Mr Gamble had handed her the new rego sticker for the car.

[16] The applicant claimed that when she phoned Mr Gamble on returning home, Mr Gamble had referred to the termination as being by ‘mutual agreement’. She forwarded a letter to him on Thursday 13 February 2014. This outlined her view of the events of the previous two days. It said, in part:

‘You said you fired me because of mutual disagreement. I have never been fired before and it has caused me a great deal of distress as I do not understand the justification for this action.

I feel that I should be able to voice my concerns if the tasks given to me are expected in an unreasonable timeframe without being fired. However as the CEO / Owner I respect that the engaging and termination of staff is your decision.’

[17] The applicant said that she phoned Mr Gamble at approximately 10:00am on Friday 14 February to ask to meet him to resolve their issues. Mr Gamble said he felt ill and could not meet until the following week. At about 10:30am, she texted that she was sorry he was unwell, but, ‘If you do not wish to resolve this Warren there is nothing more I can do but look after myself.’ She also called Mr Egan at around 10:55am, as she was concerned about Mr Gamble. She forwarded a further email to Mr Gamble at 11:03am setting out their conversation. It was as follows:

‘Just confirming our telephone call this morning when I phoned to see if I could see you today to discuss the issues and receive the pay owing to me.

I am sorry to hear that you are feeling terrible. You stated that you would not meet with me, you would not be paying the amount owed to me, you were going to see Paul the Accountant next week and to do what I had to do.

It is disappointing that after three years we are unable to communicate.

Unfortunately you have left me with no choice but to phone Fairwork Australia.’

[18] The applicant said that she was writing a further email to Mr Gamble on Saturday 15 February 2014, when her internet and phone stopped working. Telstra subsequently told her that Mr Gamble had cut off her account. She said that Mr Gamble had never paid her account and he was not authorised to disconnect her services. He had asked for her account to be sent to the respondent two years earlier, as he had intended payment of her phone and internet would make up part of a salary package. She sent Mr Gamble an email on the morning of 16 February 2014 protesting strongly at him having stopped the account (which was reinstated and credited on 27 February 2014). She also forwarded the email she intended to send before her internet was cut off. In this email, she offered to come in and help train a replacement and made an offer to settle the dispute, under which she would come in two days per week, subject to her being paid outstanding entitlements for annual leave and notice.

[19] It was the applicant’s evidence she had received a number of phone calls from people who had been told by Mr Gamble that he had ‘fired’ her and had ‘locked her out’. He had also made allegations of her making excessive international phone calls, theft of cash and of a car. He had made reference to ‘heavies’ who would ‘deal’ with her. The applicant’s fear of Mr Gamble’s threats in relation to his ‘heavies’ and of having reported her to police in relation to the car affected her sleep. She had actually handed herself into a police station, where she had been assured that the car had not been reported as stolen. The relevant Constable had said that he had noted that the car was the subject of a civil dispute.

[20] The applicant said she was sad because ‘itac2 is a great product’. She felt that she had wasted three years of her life. She did not believe that Mr Gamble ever had any intention of keeping his word.

[21] The applicant filed witness statements in reply which specifically responded to the statements of Mr Gamble and Mr Egan. She denied that she had provided her own tools of trade or determined when she worked. She had used the respondent’s computer and software and was required to be at work at 7:30am. She was also required to fill in time sheets until 30 June 2012. She agreed that when she had performed ‘consultancy’ work, she was not an employee and that she continued to operate her own business under her own Australian Business Number (ABN).

[22] It was the applicant’s evidence that she had managed the respondent’s business, as Mr Gamble was often absent from the premises. Mr Gamble had told her that she was the General Manager, but he would occasionally refer to her as his secretary. She denied ever having been offended at his referring to her as his Personal Assistant. She clarified that from July 2011, she had worked three, rather than 2 ½ days per week, starting at 6:00am each day.

[23] The applicant denied that she had been directed to deal with Ms Broben as to the use of mobile phones during work hours. She said that she and Ms Broben ‘were aware of the problem and resolved it.’

[24] The applicant did not accept that Mr Gamble being in the office more from August 2013 meant that he was able to give her extra work; she was always busy. She denied routinely reacting in a hostile manner when he gave her further work to do.

[25] The applicant explained that Mr Gamble checked her computer and emails daily. She was required to obtain approval for all her work. She had permission to use the info@ email account to administer the estate of her late mother and in relation to travel arrangements to New Zealand before her mother had died, as well as other general personal emails. The applicant expressly denied carrying out her bookkeeping business while working for the respondent.

[26] The applicant stated that it was agreed between her and Mr Gamble that she should wait before putting in entries on the EMDG Grant, so as to avoid doubling up if there were changes in the law.

[27] The applicant denied becoming upset when Mr Gamble had suggested that Ms Broben should take over customer calls at the end of January 2014. Nor did she accept that this caused her to become increasingly agitated and sensitive in her dealings with Mr Gamble.

[28] The applicant claimed that Mr Egan would have known she was General Manager as she had confided in him as to the issues she was having with Mr Gamble. However, this went ‘horribly wrong’. She denied that she and Mr Egan swore regularly in their conversations - if he did, he would apologise. Nor did she complain about her working conditions, Mr Gamble or her holiday pay. The applicant strongly denied that Mr Egan was at the premises on the morning of 11 February 2014.

[29] In cross examination, the applicant was adamant that she had not been paid appropriately according to the relevant Award, that she had not provided her own tools of trade and that she had not determined when she worked. However, she agreed she had provided bookkeeping services to other clients.

[30] The applicant said that she had not been offended by being referred to as a ‘PA’. She denied requesting the title of General Manager, though she had referred jokingly in an email to becoming General Manager after throwing a ‘hissy fit’ in an email to a friend.

[31] The applicant agreed that Mr Gamble worked approximately 80% of his time out of the office. However, she would let herself into the office in the morning and attend to her work. Mr Gamble would give her tasks, but would not allocate times for them to be done. She claimed that she had permission to use the phone and email for personal use, due to her role as GM and the long hours she put in on weekends, public holidays and unpaid overtime. She added that Mr Gamble had actually had free use of her printer for nine months and the only way she could get her material to her accountant was to bring it to work, scan it and send it by email. The number of personal emails on the computer would have been clear to Mr Gamble at all times.

[32] The applicant denied that she had become more defensive around Mr Gamble from October 2013. She had been more ‘straight up’ with him, but this was because Mr Gamble had asked her to be so. The applicant said that she would not describe Mr Gamble as a passive person and that he could be aggressive. After the incident on 11 February 2014, she had left the office for the whole day, as she was giving him time to calm down.

[33] The applicant acknowledged that Mr Gamble had given her the car registration papers in the office on the day that she returned the keys. However, this was only because Mr Gamble did not want to get fined for an unregistered vehicle. She denied he had told her to contact the accountant for her wages, she did so. However, she had done so and the accountant had said that Mr Gamble had not given him permission to pay her.

Mr Michael Campbell

[34] In his written statement, Mr Campbell said that in 2011, Mr Gamble had recommended the applicant undertake some work in relation to his business’ bookkeeping and GST compliance. She had performed contract work for his business ever since. He described her as professional, trustworthy, and very efficient.

[35] In oral evidence, Mr Campbell clarified that he had been working in a factory near to the respondent. His brother had approached Mr Gamble and explained as to the kind of work performed by the applicant and recommended that they approach her. Mr Gamble was fully aware that she was performing work for them.

[36] In cross examination, Mr Campbell said he understood that the applicant was contracted separately to his business and that it was not linked to any work performed for the respondent.

Ms Leesa Deen

[37] Ms Deen works for the Department of Transport and Main Roads, specifically in HR and Finance. In her written statement, Ms Deen explained that the applicant had called her for support and advice over the second half of 2013 in relation to issues in her workplace. She spoke about vandalism, a disturbing letter placed under the door and urine on the screen door. The applicant also raised concerns about non-payment of weekly wages, recreational leave pay and unpaid superannuation.

[38] Ms Deen was with the applicant when Mr Gamble called her on a Sunday and demanded she meet him (See para [8]). The applicant had told Ms Deen that Mr Gamble wanted to terminate another employee by the name of Janine. The applicant had told her that Mr Gamble had said that nobody would employ her due to her age and the fact she was from New Zealand. The applicant called Ms Deen on 11 February 2014 to tell her that she had been ‘fired’. She had left the office immediately as she was scared of Mr Gamble’s abusive and erratic behaviour. Ms Deen understood that Mr Gamble had said something about sending his ‘heavies’ around.

[39] Ms Deen said that the applicant had also referred to a comment made by ‘Bill’ (a work colleague), that all women over 50 should have their ovaries removed. The applicant had also complained about abusive telephone calls from unhappy clients.

[40] In oral evidence, Ms Deen deposed that on the day the applicant was ‘fired’, she had told her that Mr Gamble had told her to ‘Fuck off’’ in an agitated fashion. The applicant now had issues sleeping. When she had wanted to contact Mr Gamble to resolve the issue, the applicant found that her internet and phone had been disconnected and she had to deal with Telstra to fix this. It took some time for her new phone to work properly.

[41] In cross examination, Ms Deen agreed that the applicant had made over 80 phone calls for periods of between 20 minutes and one hour to her from the office phone of the respondent.

For the respondent

Mr Warren Gamble

[42] In his written statement, Mr Gamble deposed that he had contracted with the applicant in March 2010 to provide bookkeeping services for three of his businesses - itac2 Pty Ltd, Kair Furniture Company Pty Ltd and Gamble & Sons French Polishers. She invoiced him and quoted her ABN. She would determine when she worked and she provided her own tools of trade.

[43] Mr Gamble stated that the applicant also provided market consultancy services to the respondent as an independent contractor from July 2011. They reviewed the contract every twelve months. She also maintained her own bookkeeping business which he believed she operated through her ABN. Around this time, she was also employed 2 ½ days per week to perform bookkeeping functions, general clerical duties and to assist Mr Gamble, as necessary. These changes arose from a growth in business manufacturing and distribution of a sports hand gel. The applicant was paid $25 per hour and worked largely unsupervised, as Mr Gamble focused on his other businesses, particularly Gamble & Sons French Polishers. He would work between 12-16 hours per day. When he saw the applicant, he would direct her as to what needed to be done and when it needed to be completed. However, the applicant did not complete timesheets. While she had no official title, he would have described her as his Personal Assistant.

[44] Mr Gamble explained that the applicant was the respondent’s only permanent employee, though occasionally he would employ casual factory hands and storemen. From mid 2013, he gradually began to wind down the French polishing business to focus on his other businesses.

[45] Mr Gamble claimed that in August 2013, the applicant had been offended at being referred to as a PA in front of clients and had requested the title of General Manager. While he agreed to this request, there was no substantive change to her duties.

[46] Mr Gamble said that after some difficulties with getting daily orders completed in time in February 2013, the applicant had complained that she was ‘snowed under’ and that she needed more help. A casual employee was hired. However, the applicant said that this person made too many mistakes and she was ‘let go’. Another casual employee was engaged in May 2013 - Ms Janine Broben. After she was hired, Mr Gamble had cause to speak to the applicant about the use of personal mobile phones in the office, stressing that they should only be used in emergencies. He directed the applicant to lead by example in this respect.

[47] Mr Gamble explained that after August 2013, a change in business focus meant that he spent more ‘hands-on’ time in the office. He would set out short and long term tasks for the applicant to work on and have regular meetings with her to discuss issues. He also was able to monitor her work more closely. He claimed the applicant reacted badly to this supervision. Increasingly, if he allocated her a further task, she would respond by saying, ‘What now?’, ‘Just put it on the pile!’ or ‘Fuck’en hell, more shit to do.’ Mr Gamble said he did not react to these comments.

[48] Mr Gamble deposed that when the applicant took personal leave in November 2013 to visit her dying mother in New Zealand, Mr Gamble discovered that she was receiving a large volume of personal emails in the Kair Furniture Company Pty Ltd email account.

[49] Mr Gamble said that immediately prior to the 2013 Christmas holiday period, he and the applicant had discussed leave arrangements. The applicant had suggested that she wanted to work through the holiday period (apart from the public holidays) in order to catch up. Mr Gamble agreed to this proposal and when he returned from leave early in the New Year, the applicant told him she had caught up on a lot of work. When she took leave to attend the Australian Open in Melbourne shortly after this, Mr Gamble had cause to use her computer and he found a number of personal emails, work in progress statements, GST reports and company paperwork that were not related to any of his businesses. From this information, he determined that the applicant had been working her own bookkeeping business on his time.

[50] Mr Gamble denied there had been any agreement with the applicant that she would ‘hold off’ on the entries to the EMDG application and associated documents, to see if there were any changes in the law. It was a requirement that the relevant data be entered each week. The applicant had made a unilateral decision not to complete the documents. He directed the applicant to do so. He also proposed that Ms Broben should take over customer email enquiries to free up the applicant’s time. The applicant was upset by this. Her hostile behaviour increased in the following weeks. She would make comments like, ‘Obviously my work isn’t good enough for you.’

[51] Mr Gamble said that the meeting on 11 February 2014 was arranged in order to follow up and review tasks set at a previous meeting on 4 February 2014. At 9:00am, he had asked the applicant to provide him with a spreadsheet of the Australian pole dancing client list and to confirm that all was ‘on track’ for the 10:00am meeting. The clients were listed alphabetically, rather than in accordance with Mr Gamble’s preference to have them listed under each state and territory. The applicant complained that this was not her fault. However, he stressed that it was her job to check Ms Broben’s work.

[52] Mr Gamble said that at 10:20am, after the time for the meeting had passed (10:00am), he asked the applicant if she could attend the meeting. The applicant grabbed some files, stood over him, thrust her arms in his direction and an exchange to the following effect took place.

Mr Gamble stated that he had remained seated and spoke calmly during this exchange. The applicant took her bag and left the workplace. She did not return to the office or contact him that day.

[53] It was Mr Gamble’s evidence that when he returned to work the following day, the applicant was not there. He believed that she had quit her job. He then left a message on her voicemail, asking her to return the office keys, provide the MYOB password and ‘finalise things’. The applicant arrived at 11:30am, gave him the office keys and packed her personal effects. She said she was in a hurry, as she had a job interview to get to. He told her that he would be in touch with the accountant. However, the accountant would not be back from leave until 17 February 2014 and she should contact him then in relation to her outstanding entitlements. As the applicant was leaving, he called out to her, and handed her the registration sticker for the car. He said goodbye and wished her well. He subsequently contacted the accountant on 18 February 2014 to inform him of what had occurred.

[54] Mr Gamble claimed that some time after the applicant left on 12 February 2014, he went through her computer and discovered numerous personal files and MYOB files unrelated to his businesses. The phone bill also showed a number of unauthorised phone calls to New Zealand and to a mobile number (later found to be that of Ms Deen) made while he was not in the office. As the applicant was responsible for the bookkeeping and she had paid the telephone bills, he had not been aware of what she had been doing.

[55] Mr Gamble referred to the applicant’s first statement and denied that he had had discussions with the applicant about ‘postponing’ her employment contract or that he had promised the applicant a full time employment contract. He said that she ‘worked as a contractor as well as on the payroll’. He clarified that she ‘worked under contract marketing for the MDG grant as well as payroll for your bookkeeping’. He denied he had intended she be given full time employment and Ms Broben be made marketing consultant after she resigned her market consultant role. He denied that he had called the applicant on a Sunday and ‘ordered’ her to work.

[56] Mr Gamble agreed that the applicant had forwarded him emails on Thursday 13 February and Friday 14 February 2014. However, neither email accurately reflected what had happened. Mr Gamble admitted that he had called Telstra to have the applicant’s name removed from the account.

[57] In cross examination, Mr Gamble suggested that he had arrived at the conclusion that the applicant was using the respondent’s MYOB to process other people’s work, due to the their being actual MYOB files on the computer. They were not scans or PDF documents.

[58] Mr Gamble was shown an organisational chart that showed him as Director/CEO/Owner of Itac Pty Ltd and the applicant directly below him as General Manager. He and the applicant had discussed this matter and put it together in 2011. However, it represented as to how the business would be structured in the future.

[59] Mr Gamble accepted that in addition to her bookkeeping and general office duties, the applicant also drafted contracts and dealt with stock reconciliation. He described her role as a clerical one; noting that she was not engaged in manufacturing, French polishing or deliveries. He accepted that some of these duties fell under her marketing contract.

[60] Mr Gamble denied giving the applicant approval to make some personal calls and do some personal business at work due to her long hours, work on weekends and rare lunch breaks. However, he conceded he had given her permission to deal with legal and other issues after the death of her mother in New Zealand. He agreed he was aware that she worked for other clients and that it was necessary for her to be identified as a contractor for the EDMG grant.

[61] Mr Gamble claimed he was ‘taken aback’ when the applicant told him that she had not completed the EDMG entries, as he had understood that she would be working on this, amongst other things, over the Christmas break. She had previously told him that she had completed all her work over the Christmas break.

[62] Mr Gamble acknowledged that some of the phone calls to New Zealand were actually made by Ms Broben to the applicant while she was on personal leave in New Zealand. However, he stressed that many more were made when the applicant was at work. In any event, he had discouraged Ms Broben from calling the applicant as he wanted to give her that time to deal with the death of her mother and for Ms Broben to become more confident in her role. He had paid the applicant $1,000 for the week she was away in New Zealand as he thought it would be appropriate that she be paid bereavement leave and have some income while she was away.

Mr William Egan

[63] In his written statement, Mr Egan explained that he had been employed by the Trustee for the Gamble Family Trust t/as Gamble and Sons French Polishers (Gamble & Sons) on a casual basis. The company operates at the same premises as the respondent. Mr Egan’s hours are sporadic and a number of casual staff have worked for the respondent and Gamble & Sons. He believed that the applicant was the longest serving employee of the respondent.

[64] Mr Egan said that he would usually start work between 7:00 and 7:30am. Mr Gamble would generally not be in the office, as he would be busy seeking business opportunities for his business. Both Mr Egan and the applicant worked unsupervised on tasks allocated to them by Mr Gamble, although he was unsure what the applicant’s duties were. It appeared to be accounting or bookkeeping. They would exchange small talk during the day, as Mr Egan sometimes worked manufacturing wax near the applicant’s desk. The applicant would regularly swear in their discussions, as would he. He had also witnessed the applicant and Mr Gamble swear in their conversations with each other.

[65] Mr Egan claimed that starting in late 2013, the applicant would ‘relentlessly carp and criticise Warren to me’. She complained about her working conditions, entitlements, Mr Gamble’s relationship with clients and what she perceived as his overbearing supervision. She had used the phrase ‘Warren has lost the plot’ a number of times. These comments coincided with an increase of Mr Gamble’s time at the office. In the week leading up to 11 February 2014, the applicant told him that she was under pressure and made a number of adverse comments about Mr Gamble.

[66] Mr Egan described the applicant’s behaviour on the morning of 11 February 2014 as ‘particularly agitated’, ‘flustered and bothered’. She was ‘storming around the office, throwing things down on the desk and the like.’ At some time in the mid-morning, he went to the room adjacent to the office. He saw Mr Gamble sitting at his desk. He couldn’t see into the main office, but could hear the applicant yelling aggressively at Mr Gamble words similar to: ‘What do you want me to do first? ... I’ve had enough of this shit.’ Mr Gamble had responded, assertively but not loudly or aggressively, in words to the effect of: ‘Fuck off Marrianne, you cannot keep speaking to me like that.’ The applicant had then replied in words to the effect of: ‘You’ve told me to fuck off, so I’m going.’

[67] Mr Egan said that due to the commotion, he walked into the office and saw the applicant take her bag and leave the office. Having observed her throughout the morning, he believed that her behaviour was premeditated and intended to ‘force the issue’. Mr Egan denied speaking to the applicant since that day.

[68] In oral evidence, the Mr Egan clarified that he would usually work from about 7:30am until he had to leave to pick up his daughters in the afternoon. He would then return to work after that. He confirmed that he was on the premises on 11 and 12 February 2014.

[69] In cross examination, Mr Egan confirmed that he would start work between 7:30am and 8:00am every day he worked. As the business of the respondent built up, this was almost every day. If he had to drop his children off to school, he would come back to work. He disagreed with the proposition that he generally started between 3:30pm and 5:00pm. On the morning of 11 February 2014, he had started work some time between 8:00am and 8:30am.

[70] Mr Egan emphasised that he was not privy to what the applicant’s actual duties were. He was hired as a labourer picking up furniture for Mr Gamble. When he developed carpal tunnel, Mr Gamble had allowed him to work manufacturing wax. He was a factory worker and could not recall the applicant’s precise role in the business. He had not been aware that the applicant was the General Manager of the respondent.

[71] At this point in the evidence, the applicant claimed in response to a question from me, that she would supervise Mr Egan and pass on directions from Mr Gamble.

[72] Mr Egan could not recall the exact time toward the end of 2013 when the applicant had complained about not receiving holiday pay, but he could recall the applicant saying that Mr Gamble owed her $13,000.

[73] Mr Egan could not remember as to whether he had worked at the premises until 10:00pm on 11 February 2014. He could recall seeing the applicant the next morning. She had said, before walking through to the toilet, ‘See you later. I won’t be - Thanks for working with me.’ He had not replied as he had been concentrating on pouring wax at the time. He initially could not recall any phone conversation with the applicant on 14 February 2014, but then acknowledged that he had received a call from her of about five seconds in which he had said that he could not talk to her as he was in the middle of talking to his doctor. He did not regard this exchange as a conversation.

SUBMISSIONS

For the applicant

[74] The applicant did not file written submissions, although her evidentiary background material was extensive. She did file a document with her statement marked ‘Summary of Claim’, in which she described herself as a professional, dedicated, supportive and hardworking employee who was ‘fired’, without warning, and for no reason. The actions of Mr Gamble in falsely accusing her of embezzlement had caused her distress. She had tried to resolve the situation on eight occasions, but Mr Gamble had not been open to any resolution. She sought compensation of six months pay and reserved the right to seek further entitlements which she claimed were owed to her.

[75] In oral submissions, the applicant said that she did not currently have other work, although she had applied for ‘about 50’ jobs. She believed rumours of her embezzling the respondent had hampered her efforts at obtaining alternative work.

For the respondent

[76] In written submissions, the respondent stated that the applicant was covered by the Clerks Private Sector Award 2010 [MA000002] and was being paid in excess of her entitlements under that instrument.

[77] The respondent submitted that the applicant had not been dismissed, but had resigned from her employment on 11 February 2014. The respondent put an alternative submission that, if it was found she had been dismissed, there was a valid reason for her termination. However, Mr Gamble acknowledged that he had not followed the Small Business Fair Dismissal Code (the ‘Code’) or due process under the Act.

[78] The respondent directed the Commission’s attention to the requirement to determine the jurisdictional issue as to whether the applicant had been dismissed (s 396) prior to considering the merits of the applicant’s case. The facts surrounding the ending of the applicant’s employment were contested, but on the balance of probabilities, the Commission should prefer the version of events advanced by Mr Gamble and Mr Egan over those of the applicant.

[79] The respondent submitted that this evidence demonstrated that from August 2013, Mr Gamble had increased his role in the day to day operations of the respondent. During this period, he became aware that the applicant was using a significant amount of time at work for non-work related matters and she was supervised more closely as a result. She became more agitated in her interactions with Mr Gamble in the weeks immediately prior to 11 February 2014.

[80] The respondent claimed that Mr Gamble had given the applicant a lawful and reasonable direction on the morning of 11 February 2014. The response of the applicant was unreasonable. It was acknowledged that Mr Gamble’s language was inappropriate, but the applicant had provoked him and, in any event, the use of coarse language was common in the workplace. Swearing at the applicant did not constitute termination at the initiative of the employer; See: Bounleuth Darasouk v Barbtano Investments Pty Ltd PR929655 [2003] AIRC 368. Nor could the form of words used by Mr Gamble been seen as constituting a dismissal of the applicant.

[81] By contrast, the respondent submitted that the actions of the applicant in immediately leaving the workplace after the exchange with Mr Gamble, and failing to attend to work or contact the respondent on the morning of 12 February 2014, constituted a resignation on the part of the applicant. It was a reasonable basis on which to conclude that the applicant had resigned her position, especially in light of her conduct over the previous few months.

[82] The respondent noted that the applicant had made claims of underpayment against the respondent. This was beyond the jurisdiction of the Commission and was currently the subject of an application before the Fair Work Ombudsman (FWO).

[83] The respondent conceded that in the event that the Commission did not accept that the applicant had resigned, the applicant would have been unfairly dismissed. However, it submitted that the conduct of the applicant in devoting excessive attention to personal matters while at work, constituted a valid reason for her dismissal. In any event, the behaviour of the applicant meant that if she had remained at work, it was unlikely that she would have remained employed for much longer. The respondent noted that it was a small employer with no dedicated human resource management expertise.

[84] While the applicant did not seek reinstatement, the respondent emphasised that in the event that the Commission found that the dismissal was unfair, reinstatement would be inappropriate, given the applicant’s behaviour. Any award of compensation should take into account that the applicant had worked for the respondent for only approximately 2 ½ years. She had not provided any evidence that she had attempted to mitigate her loss and she presumably continued to operate her bookkeeping business.

CONSIDERATION

Did the applicant resign or was she dismissed by the respondent?

[85] S 386(1) of the Act sets out the meaning of ‘dismissed’ as follows:

‘386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.’

[86] The Explanatory Memorandum to the Fair Work Bill 2008 explained in respect to the operation of s 386 as follows:

‘Clause 386 - Meaning of dismissed

1528. This clause sets out the circumstances in which a person is taken to be dismissed. A person is dismissed if the person's employment with his or her employer was terminated on the employer's initiative. This is intended to capture case law relating to the meaning of 'termination at the initiative of the employer' (see, e.g., Mohazab v Dick Smith Electronics Pty Ltd (1995) 62 IR 200).

1529. Paragraph 386(1)(b) provides that a person has been dismissed if they resigned from their employment but were forced to do so because of conduct, or a course of conduct, engaged in by their employer. Conduct includes both an act and a failure to act (see the definition in clause 12).

1530. Paragraph 386(1)(b) is intended to reflect the common law concept of constructive dismissal, and allow for a finding that an employee was dismissed in the following situations:

• where the employee is effectively instructed to resign by the employer in the face of a threatened or impending dismissal; or



• where the employee quits their job in response to conduct by the employer which gives them no reasonable choice but to resign.’

[87] Two well known cases have considered the concept of termination at the initiative of the employer. In Mohazab v Dick Smith Electronics Pty Ltd [No 2] (1995) 62 IR 200 (‘Mohazab’), the Full Court of the Industrial Relations Court of Australia said:

‘The critical issue in this appeal is whether there had been a termination of the employment of the appellant. The statutory right to seek a remedy depends upon there having been. This emerges from the provisions of s 170EA(1) which reads:

‘A person (“the employee”) may apply to the Court for a remedy in respect of termination of his or her employment.’

Section 170CA provides that the object of Div 3 of Pt VIA is to give effect to the Convention concerning Termination of Employment at the Initiative of the Employer and the Recommendation concerning Termination of Employment at the Initiative of the Employer which are Schs 10 and 11 of the Act respectively. Section 170CB provides that an expression has the same meaning in the Division as it has in the Convention. The terms ‘termination’ and ‘termination of employment’ are defined in the Convention as meaning ‘termination at the initiative of the employer’. Accordingly the terms ‘termination’ and ‘termination of employment’ in the Act have the same meaning. The Convention does not, however, define the expression ‘‘at the initiative of the employer’’ and its meaning in the Convention must be gleaned from the Convention as a whole. This expression does not appear in the Act and is imported into the Act by s 170CB.

It is distracting, in our opinion, to treat the question posed in the present case to be whether the applicant resigned or had his employment terminated by the respondent. A question framed in those or similar terms assumes that a resignation is not or could not be a termination at the initiative of the employer. The present task is to construe the expression ‘termination at the initiative of the employer’ as it appears in the Convention and determine whether there has been such a termination in relation to the employment of the applicant…

It is necessary to consider the ordinary meaning of the expression ‘termination at the initiative of the employer’ in context in the Convention having regard to its object and purpose. The word ‘initiative’ is relevantly defined in the New Shorter Oxford Dictionary in the following way:

‘initiative 1. The action of initiating something or of taking the first step or the lead; an act setting a process or chain of events in motion; an independent or enterprising act.’

And in the Concise Macquarie Dictionary in the following way:

‘initiative 1. an introductory act or step; leading action; to take the initiative. 2. Readiness and ability in initiating action; enterprise: to lack initiative.’

These definitions reflect the ordinary meaning of the word ‘initiative’. Viewed as a whole, the Convention is plainly intended to protect workers from termination by the employer unless there is a valid reason for termination. It addresses the termination of the employment relationship by the employer. It accords with the purpose of the Convention to treat the expression ‘termination at the initiative of the employer’ as a reference to a termination that is brought about by an employer and which is not agreed to by the employee. Consistent with the ordinary meaning of the expression in the Convention, a termination of employment at the initiative of the employer may be treated as a termination in which the action of the employer is the principal contributing factor which leads to the termination of the employment relationship. We proceed on the basis that the termination of the employment relationship is what is comprehended by the expression ‘termination of employment: Siagian v Sanel (1994) 1 IRCR 1 at 19; 54 IR 185 at 201. In many, if not most, situations the act of the employer that terminates the employment relationship is not only the act that puts in train the process leading to its termination but is, in substance, the entire process. An example would be a situation where the employer decided to dismiss an employee and did so orally or in writing with immediate effect. Other situations may be more complex as exemplified by the circumstances considered by Moore J in Grout v Gunnedah Shire Council (1994) 1 IRCR 143; 57 IR 243 where an employee had given written notice purporting to terminate the employment relationship. The notice was not reasonable but was accepted by the employer which later refused to allow the employee to withdraw the notice. A question arose as to whether that was a termination of the employment at the initiative of the employer and his Honour held it was. His Honour said at 160-161; 259:

‘I have already said that Div 3 concerns termination at the initiative of the employer. The respondent submits that “initiate” means “to begin, commence, enter upon; to introduce, set going, or initiate”: see Shorter Oxford English Dictionary. In this matter, it is submitted, it was the applicant and not the respondent that initiated the termination by writing the letter of 18 May. This, in my opinion, gives the expression “termination’ in the Act, read in conjunction with Art 3 of the Convention which speaks of ‘termination . . . at the initiative of the employer”, a narrow meaning that was not intended. A principal purpose, if not the sole purpose, of Div 3 is to provide an employee with a right to seek a remedy in circumstances where the employee did not voluntarily leave the employment. An employee may do some act which is the first in a chain of events that leads to termination. An example would be an employee who engaged in misconduct at work which ultimately led to the employer dismissing the employee. However, that situation and the present are not situations where the termination was at the initiative of the employee. In both instances the step or steps that effectively terminated the employment or purported to do so were taken by the employer.’

In these proceedings it is unnecessary and undesirable to endeavour to formulate an exhaustive description of what is termination at the initiative of the employer but plainly an important feature is that the act of the employer results directly or consequentially in the termination of the employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship. This issue was addressed by Wilcox CJ in APESMA v David Graphics Pty Ltd (unreported, Industrial Relations Court of Australia, 12 July 1995, Wilcox CJ). His Honour, at p 3, referred to the situation of an employee who resigned because ‘he felt he had no other option’. His Honour described those circumstances as:

‘... a termination of employment at the instance [of] the employer rather than of the employee.’’

And at p 5:

‘I agree with the proposition that termination may involve more than one action. But I think it is necessary to ask oneself what was the critical action, or what were the critical actions, that constituted a termination of the employment.’[footnotes omitted]’

[88] A Full Bench of the Australian Industrial Relations Commission (AIRC) in ABB Engineering Construction Pty Limited v Doumit [1609/96 Print N6999, 9 December 1996] said:

‘Often it will only be a narrow line that distinguishes conduct that leaves an employee no real choice but to resign employment, from conduct that cannot be held to cause a resultant resignation to be a termination at the initiative of the employer. But narrow though it be, it is important that that line be closely drawn and rigorously observed. Otherwise, the remedy against unfair termination of employment at the initiative of the employer may be too readily invoked in circumstances where it is the discretion of a resigning employee, rather than that of the employer, that gives rise to the termination. The remedies provided in the Act are directed to the provision of remedies against unlawful termination of employment. Where it is the immediate action of the employee that causes the employment relationship to cease, it is necessary to ensure that the employer's conduct, said to have been the principal contributing factor in the resultant termination of employment, is weighed objectively. The employer's conduct may be shown to be a sufficiently operative factor in the resignation for it to be tantamount to a reason for dismissal. In such circumstances, a resignation may fairly readily be conceived to be a termination at the initiative of the employer. The validity of any associated reason for the termination by resignation is tested. Where the conduct of the employer is ambiguous, and the bearing it has on the decision to resign is based largely on the perceptions and subjective response of the employee made unilaterally, considerable caution should be exercised in treating the resignation as other than voluntary.’

[89] As to whether the employer’s intention is a relevant consideration in a constructive dismissal context, a Full Bench of Fair Work Australia (as it then was) in Elgammal v BlackRange Wealth Management Pty Ltd ACN 092 380 348 t/a Commonwealth Financial Planning [2011] FWAFB 4038 said:

‘It is adequate for us to indicate that we accept that when considering whether an employer has repudiated the contract the test is not the employer’s actual intention, judged subjectively, but whether the conduct of the employer, judged objectively by reference to the effect on a reasonable person evinced an intention to no longer be bound by the contract.’

[90] This proposition is consistent with an earlier Full Bench decision of the AIRC in Australian Hearing v L Peary [2009] AIRCFB 680, where at paras [29]-[30]:

‘[29] The first ground of appeal is that the Commissioner did not give proper effect to s.642(4) of the Act. It was submitted that the use of the word “forced” indicates a legislative intention that in cases of resignation there will be no termination at the initiative of the employer unless the resignation was an intended consequence of conduct or a course of conduct engaged in by the employer. On that basis, the Commissioner’s finding that the resignation resulted from the employer’s conduct is not sufficient to attract the operation of the section. The element of intention is missing. It was further submitted that there was no evidence of such an intention in any event.

[30] We cannot accept this construction of the section. The section specifies the matters that an employee who has resigned must prove in order to displace the legal effect of the resignation. The employee must prove that the employer engaged in conduct or a course of conduct which forced the employee to resign. There is no warrant for requiring the employee to prove an additional matter, that the employer intended to force the employee to resign. The plain words of the section deny such a requirement. Furthermore, the section is not directed at the state of mind of the employer, but at the state of mind of the employee. It is particularly difficult for an employee to prove an employer’s intention. In that respect it is relevant to note that where the Act imposes a requirement related to the intention or motive of the employer a reverse onus is usually applied.’

[91] It seems to me that the question of whether the applicant was dismissed or resigned of her own accord hinges on the conversation between the applicant and Mr Gamble on 11 February 2014 and the subsequent actions and non-actions taken by the applicant and Mr Gamble.

[92] There is no dispute that Mr Gamble told the applicant to ‘Fuck off’ on 11 February 2014. He regretted using such language. Mr Egan deposed that Mr Gamble had responded to the applicant ‘assertively, but not loudly or aggressively.’ Given the tension that existed that morning between the applicant and Mr Gamble, I do not accept Mr Egan’s or Mr Gamble’s ‘played down’ characterisation of this discussion. On any objective analysis, where an employer tells an employee to ‘Fuck off’ and then does not take any action to explain or withdraw that expression, it constitutes a direction to the employee to leave the workplace. As such, it constituted a constructive dismissal of the applicant.

[93] In my view, the actions of Mr Gamble subsequent to this incident confirm that he had intended to dismiss her at the time and he took no step/s to disavow her of that belief. For example, when the applicant did not attend for work the next day, he assumed she had ‘quit her job’. He left a message for her to return the office keys, provide the MYOB password and ‘finalise things’. When the applicant arrived around 11:30am, she complied with these requests. At no time, on Mr Gamble’s own evidence, did he seek to initiate a discussion with her to clarify what had happened the day before. If he really believed that the applicant had resigned, there was no attempt to confirm with her that that is what she had intended. This corroborates my finding that the applicant had been constructively dismissed and had not resigned.

[94] The evidence of the applicant and Ms Deen is also relevant in this regard. The applicant said she left the office immediately after Mr Gamble told her to ‘Just fuck off and get out’, because she was frightened by Mr Gamble’s aggressive behaviour. She understood that she had been dismissed. Ms Deen gave evidence that the applicant had phoned her that day to tell her that she had been ‘fired’ when Mr Gamble told her to ‘fuck off´ in an agitated fashion. I accept this evidence of the applicant and Ms Deen on this issue.

[95] The applicant made a number of attempts to resolve the disagreement with Mr Gamble. She had phoned him later in the day on 11 February. Mr Gamble told her that her termination was by ‘mutual agreement’. On 13 February, she challenged this claim and sought justification for her dismissal. She phoned Mr Gamble on 14 February in an attempt to meet him to resolve their issues. Mr Gamble claimed to be ill and said he could not meet until the following week. She sent a further email to him that day (See paras [16]-[17]) in which she was actively seeking to find out the basis of her dismissal. In my opinion, these are not the actions of an employee who had resigned their employment of their own accord. Moreover, by 15 February 2014 and before Mr Gamble had met with her, he had disconnected her internet and phone connection.

[96] Mr Gamble helpfully conceded that if the Commission determined that the applicant had been dismissed, then it would follow her dismissal was unfair. He accepted that he had not followed the Code or due process under the Act. I consider these concessions to be appropriate and a realistic assessment of the respondent’s case.

[97] The Code deals with dismissals in respect to misconduct and poor performance. I do not understand Mr Gamble to allege that his complaints against the applicant constituted misconduct. The Code deals with performance related dismissals as follows:

‘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.’

[98] While compliance with the Code exempts an employer from facing an unfair dismissal application, it should not be lost sight of that the Code itself imports considerations of procedural fairness similar to those identified in s 387 of the Act. That section is as follows:

‘387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC 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.’

[99] It will be seen that ss 387(b)-(e) of the Act above might broadly be characterised as issues relevant to whether an employee was afforded procedural fairness and natural justice. It is trite to observe that, even if there was a valid reason for an employee’s dismissal, the dismissal may still be held to be unfair if the employee was not afforded procedural fairness. This has been a long held industrial principle adopted and applied by this Commission, its predecessors, other industrial tribunals and other Courts, including the High Court.

[100] In Wadey v Y.M.C.A. Canberra [1996] IRCA 568, Moore J made clear that an employer cannot merely pay ‘lip service’ to giving an employee an opportunity to respond to allegations concerning his/her conduct. His Honour said:

‘In my opinion the obligation imposed on an employer by that section has, for present purposes, two relevant aspects. The first is that the employee must be made aware of allegations concerning the employee's conduct so as to be able to respond to them. The second is that the employee must be given an opportunity to defend himself or herself. The second aspect, the opportunity to defend, implies an opportunity that might result in the employer deciding not to terminate the employment if the defence is of substance. An employer may simply go through the motions of giving the employee an opportunity to deal with allegations concerning conduct when, in substance, a firm decision to terminate had already been made which would be adhered to irrespective of anything the employee might say in his or her defence. That, in my opinion, does not constitute an opportunity to defend.’

[101] Nevertheless, procedural fairness steps should be applied in a commonsense and practical way. In Gibson v Bosmac Pty Ltd (1995) 60 IR 1 (‘Gibson’), Wilcox CJ said at 7:

‘Ordinarily, before being dismissed for reasons related to conduct or performance, an employee must be made aware of the particular matters that are putting his or her job at risk and given an adequate opportunity of defence. However, I also pointed out that the section does not require any particular formality. It is intended to be applied in a practical, commonsense way so as to ensure that the affected employee is treated fairly. 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 of the section.’

[102] I now deal with each of the matters under s 387 of the Act.

Was there a valid reason for dismissal?

[103] It would seem that Mr Gamble’s ex post facto reasons for terminating the applicant’s employment in the heated exchange on 11 February 2014 were that she:

(a) had exhibited a belligerent, uncooperative attitude for some months;

(b) was spending a significant amount of time on non work related matters and her own bookkeeping business; and

(c) had made numerous unauthorised overseas telephone calls.

[104] Putting aside the fact that Mr Gamble had never raised these matters with her, I accept, from the applicant’s evidence, that she satisfactorily explained each of these allegations. I believe Mr Gamble unfairly embellished or exaggerated these issues to justify an otherwise unjustifiable dismissal. That being so, I do not accept there were any valid reasons for the applicant’s dismissal. While such a finding might seem to be the end of the matter and only a remedy for unfair dismissal need be determined, each of the other matters in s 387 reflect adversely against the respondent. It is appropriate to record them.

[105] Given the circumstances of the applicant’s constructive dismissal, it is self-evident that she was not notified of any reason for her dismissal (s 387(b), so she could not respond to any reason when she did not know what the reason was (s 387(c)). She could not have made a request to have a support person present at the meeting on 11 February 2014 (s 387(d)). There was no evidence that the applicant was ever warned her performance was unsatisfactory (s 387(e)).

[106] I accept the respondent is a small business and that it lacked human resources management expertise (ss 387(f), (g)). However, the applicant was plainly denied basic procedural fairness. Mr Gamble acknowledged as much. I find that the respondent had failed to follow the Code and these failures result in an irresistible conclusion that the applicant’s constructive dismissal was both substantively and procedurally unfair.

REMEDY

[107] The applicant does not seek reinstatement or re-employment. Given all the circumstances, I judge reinstatement as inappropriate (See: s 390(3) of the Act). S 392 of the Act sets out the matters the Commission must take into account when assessing compensation for unfair dismissal:

‘392 Remedy—compensation

Compensation

(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

Criteria for deciding amounts

(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

(a) the effect of the order on the viability of the employer’s enterprise; and

(b) the length of the person’s service with the employer; and

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

(g) any other matter that the FWC considers relevant.

Misconduct reduces amount

(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

Shock, distress etc. disregarded

(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.

Compensation cap

(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

(a) the amount worked out under subsection (6); and

(b) half the amount of the high income threshold immediately before the dismissal.

(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; and

(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.’

[108] There was no evidence as to the financial circumstances of the respondent. Accordingly, I do not consider the order I propose to make will impact on the viability of the employer’s enterprise (s 392(2)(a)). The applicant had relatively short service (2 ½ years) with the respondent (s 392(2)(b)). This is a neutral factor. I consider the applicant would not have continued employment with the respondent beyond a further 12 weeks (s 392(2)(c)).

[109] The applicant said she had applied for ‘about 50’ jobs, but had been unsuccessful (s 392(2)(d)). In addition, it might be presumed that she has at least retained, if not expanded, her bookkeeping business. There was no evidence of any income earned by the applicant in this respect, or from any other source (s 392(2)(e)). There was no proven misconduct of the applicant, so any deduction on this account is inappropriate (s 392(3)). The order I propose to make contains no component for shock, distress, humiliation or any other analogous hurt (s 392(4)).

[110] Having regard for all the matters in s 392 of the Act, I consider an order of compensation of eight weeks pay to be appropriate in this case. Such an order is below the compensation cap (ss 392(5), (6)). In my opinion, such a result reflects the principle of ‘a fair go all round’ as set out in s 381(2) of the Act.

[111] Unless otherwise advised within seven days, the amount of compensation ordered shall be based on three days a week at $31,200 pa, namely $600 per week x 8 = $4,800. An order to this effect will be issued in seven days from today unless my Chambers is advised that this amount is incorrect. In these circumstances, the Commission will require further evidence from the parties as to the applicant’s earnings at the time of her dismissal.

DEPUTY PRESIDENT

Appearances:

Applicant in person.

Mr W Gamble for the respondent.

Hearing details:

2014.

Brisbane

16 June

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