DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Stefan Richardson
v
Geelong & Surfcoast Laundry T/A Swim Alumni Pty Ltd
(U2016/14735)

Application for an unfair dismissal remedy.

[1] Mr Richardson was employed by Swim Alumni Pty Ltd T/A Geelong & Surfcoast Laundry as a casual truck/van driver from 23 March 2015 until 18 November 2016. The name of the employer on the unfair dismissal application was Geelong and Surfcoast Laundry T/A Swim Alumni Pty Ltd. The parties agreed that the name on the application should be corrected and I agreed to do so.

[2] Mr Richardson was told that he was dismissed on 14 November 2016 and worked each day of the remainder of the week. His last day of work was 18 November 2016.

[3] It is agreed by the parties and I am satisfied that Mr Richardson was dismissed at the initiative of the employer, that the dismissal was not for reasons of misconduct and not for because of redundancy, and that Mr Richardson has the minimum employment period required to be protected from unfair dismissal. I am satisfied that Mr Richardson’s employment with Geelong and Surfcoast Laundry T/A Swim Alumni Pty Ltd (Surfcoast Laundry) was covered by the Road Transport and Distribution Award 2010. The Dry Cleaning and Laundry Industry Award 2010 does not include classifications for truck/van drivers.

[4] Mr Richardson gave uncontested evidence that he worked 38 hours or more each week throughout his employment except for a couple of weeks when he was on holiday or getting his truck licence. In some weeks he worked up to 56 hours. I am satisfied that he was employed on a regular and systematic basis and had a reasonable expectation of continuing employment on that basis.

Small Business Code

[5] The parties agreed and I am satisfied that Surfcoast Laundry is a small business which employed 11 persons including Mr Richardson at the time of the dismissal and does not have any associated entities. Surfcoast Laundry claim that the dismissal was in accordance with the summary dismissal part of the Small Business Fair Dismissal Code. I am not satisfied that this is the case because the dismissal was not a summary dismissal for the reasons I set out in the next few paragraphs.

[6] Surfcoast Laundry say that the reason for the dismissal was that Mr Richardson had three accidents in the truck/van in a twelve month period and also one or two incidents of alleged road rage. The last of these incidents was on 7 September 2016 more than two months prior to the dismissal. The dismissal was also not an immediate dismissal. Mr Richardson was allowed to work for four or five days after the dismissal. I am therefore not satisfied that the dismissal is consistent with the following requirement from the Small Business Fair Dismissal Code

“It is fair for an employer to dismiss an employee without notice or warning when the employer believes on reasonable grounds that the employee’s conduct is sufficiently serious to justify immediate dismissal.”

[7] Mr Ho who is one of the owners of the business said that the delay was because he had to consult with the other owners. However, I am not satisfied that the dismissal was “without notice” given Mr Richardson worked for four or five days after the dismissal. Nor am I satisfied that Mr Ho believed on reasonable grounds that the conduct was sufficiently serious to justify immediate dismissal. If he had then the termination would have occurred much sooner. If the reasonable ground for immediate dismissal as opposed to dismissal with notice was that there was a threat to safety then Mr Ho would not have allowed Mr Richardson to continue to drive for the company for more than two months after the incident.

[8] It is not suggested that the “other dismissal” section of the Code applies and for avoidance of doubt I am satisfied that it does not because there was warning. I am therefore satisfied that the Small Business Fair Dismissal Code does not apply in this case.

The procedure adopted by the company leading to the dismissal.

[9] The reason for dismissal was the three accidents and the road rage incidents. The parties agree that there were no written warnings. Mr Richardson accepts that Mr Ho spoke to him after each of the accidents and after one incident of alleged road rage. The second alleged road rage incident was never raised with Mr Richardson and is reported in vague terms in a statement by Mr Keay. Mr Keay was not available for cross examination and no details were provided. I will not have regard to this alleged second incident. Mr Richardson accepts the evidence of Mr Ho that he told Mr Richardson that the accidents and the alleged road rage incident were not good for the business and that we can’t have more incidents like that. However, Mr Ho accepts that Mr Richardson was never specifically told that his employment was at risk if there were further accidents or alleged road rage incidents. I am therefore satisfied that Mr Richardson was never warned that his employment was at risk prior to the dismissal.

[10] The parties agree that Mr Richardson was not told what the reason for his dismissal was at the time it occurred. Mr Richardson had no opportunity to respond or to influence the decision maker, he was simply told of the decision.

[11] The parties agree that Mr Richardson was not refused a support person but that he had no practical opportunity to have a support person; given that he had no notice of the meeting when he was told he was dismissed and no prior warning of the reason for the meeting.

The evidence concerning the reasons for the dismissal.

[12] The company accepts that other drivers employed by the company were subject to complaints of road rage or inappropriate driving behaviour from the public and that other drivers had accidents. However, they believed that three accidents in a twelve month period was too many. Mr Ho gave evidence that the accidents contributed to an increase in the insurance premium payable, that the company had to pay a total of $2250 in insurance excess, that the company had to pay for some repairs to the company vehicle and that there was some lost time.

[13] Mr Richardson accepts that two of the accidents were his fault although he did argue that there were some extenuating circumstances. Mr Richardson denies that the other incident was his fault, however, the company on the advice of the insurance company did not contest liability. Mr Richardson gave evidence that in respect to two of the accidents the damage to the company vehicle was insufficient to result in any lost time or to require repairs. Although repairs were made some eight months later. This evidence was not substantially challenged. Mr Richardson accepts that in respect to one of the accidents the company vehicle was out of service and had to be replaced by another vehicle whilst repairs occurred. Mr Richardson denies that there was any significant time when the company deliveries and collections were compromised or disrupted and I accept that evidence.

[14] It is not necessary to determine the issue of whether or not the third accident was Mr Richardson’s fault.

[15] In respect to the alleged road rage incident Mr Richardson says that it was the driver of the other car who abused him and physically threatened him and falsely accused him of tailgating the other car. Mr Richardson gave evidence that he was driving at 40km/hour at the time. I accept Mr Richardson’s evidence. Mr Ho could offer no evidence to contradict or challenge this evidence. I accept that the driver of the other car did complain to the company about the incident and that the company was right to take such matters seriously and to follow them up.

[16] In the original employer response to the application Surfcoast Laundry suggested that Mr Richardson had excessive sick leave, parking fines and tension with other work colleagues. During the hearing Mr Ho said that the company no longer relied upon those matters which were vigorously denied by Mr Richardson. Mr Richardson raised issues about an OHS complaint which he said related to the alleged tension with other drivers but it is not necessary to consider this given that the company does not rely on this matter.

[17] Mr Richardson believes that the real reason for the dismissal was his complaints about the underpayment of his wages and his persistence in seeking that the underpayment be rectified by a back payment. Mr Richardson gave evidence which was accepted by Mr Ho that he raised concern about underpayment on 20 September 2016. Mr Ho said that he would look into it and Mr Richardson followed up with Mr Ho when he did not get a response. About eight weeks later Mr Ho began paying Mr Richardson the correct hourly rate. Prior to June 2016 Mr Richardson was being paid $10.20 per hour, then he was paid $21.09 per hour and the correct hourly rate which was paid in the last two weeks of Mr Richardson’s employment was $24.33. Mr Richardson was not paid any additional rate for overtime worked. Mr Richardson spoke to Mr Ho on the Wednesday 9 November 2016 and requested that the underpayments for the period prior to 2 November 2016 be rectified. Mr Ho said that he would look into it but he conceded that he took no further action about the matter. Mr Richardson says that the next day Mr Ho told Mr Keay to dismiss Mr Richardson but because Mr Keay was off sick on the Friday, Mr Richardson was not dismissed until the next working day which was the Monday 14 November 2016. Mr Ho accepts the chronology but denies that the complaint about the underpayment was the real reason for the dismissal.

[18] Mr Ho accepts that he was annoyed and irritated by Mr Richardson’s request. He was angry because

• he considered Mr Richardson was failing to acknowledge the generosity of the company towards him;



• he considered that if Mr Richardson was not happy about his pay rate he should have raised it when he was first offered employment;



• raising the issue of the backpay seemed like blackmail by Mr Richardson to keep his job;



• he believed that the pay rate he was paying was the appropriate and fair rate for the work;



• the rate he was paying was consistent with what others were doing in the industry and



• other employees were not unhappy with him.

[19] I accept Mr Ho’s evidence that the three accidents and the incident when a member of the public complained about Mr Richardson contributed to the decision to dismiss Mr Richardson. However, I also consider that an operative reason for the dismissal was Mr Ho’s annoyance at Mr Richardson’s complaint about underpayment of wages.

[20] Mr Ho accepted that Mr Richardson was “a lovely person” who was liked and valued by the company’s clients.

[21] In deciding whether or not the dismissal was unfair I am required to consider the following:

“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.”

[22] In respect to Section 387(a) the existence of a valid reason is a matter of contention. For the reasons discussed earlier I do not consider that Mr Richardson engaged in misconduct in respect to the incident when another driver complained about him. I am satisfied that this was an isolated incident and that he was not the aggressor in that case. Of course road accidents by those who are employed as truck drivers can in some circumstances become a valid reason for dismissal. However, road accidents do happen and it is to be expected that those who drive all the time for a living will sometimes have accidents and some of them will result in liability being accepted by the company’s insurer. To some extent the costs associated with accidents are a part of the cost of doing business in that sector. The costs in this case were not particularly unusual. Mr Richardson did not engage in negligent or illegal conduct in the incidents such that he was interviewed or charged by the police or should have been interviewed or charged.

[23] I accept that three accidents in a year is a matter of concern and warrants some level of intervention by the employer. However, I am not satisfied that there was a valid reason for dismissal. I am not satisfied that Mr Richardson’s actions were misconduct. A dismissal because of these three accidents in a twelve month period and more than two months after the last of the incidents could not be described as sound, defensible or well founded. In fact dismissal in these circumstances was disproportionate to the severity of the conduct.

[24] This is particularly the case when I am satisfied that one of the reasons for the dismissal was that Mr Richardson was exercising his workplace right to complain about the underpayment of his wages and seek that this be rectified. The dismissal in these circumstances was a breach of general protections under Part 3-1 of the Fair Work Act 2009. This is another reason why I am satisfied that the dismissal was not sound, defensible or well founded and that there was no valid reason for the dismissal relating to Mr Richardson’s capacity or conduct.

[25] In respect to Section 387(b), if I find that Mr Richardson was not informed of the reason for termination in advance of the decision having been made.

[26] In respect to Section 387(c) I find that Mr Richardson did not have an opportunity to respond to the reason for dismissal which was related to his capacity or conduct.

[27] In respect to Section 387(d) it is accepted that there was no refusal to allow a support person but the fact that the dismissal discussion took place without any notice or advice as to the purpose of the meeting means that there was no opportunity to have a support person. This is a factor which is relevant under Section 387(h).

[28] In respect to Section 387(e) it is accepted that the reason given for dismissal was not unsatisfactory performance but was misconduct. The issue of the lack of prior warning is however relevant in respect to Section 387(h) as the matters alleged are of the type which should in fairness have been the subject of a warning prior to any decision to dismiss.

[29] In respect to Sections 387(f) and (g) it is accepted that the company is a small business and it does not have dedicated human resource management personnel or expertise. I accept that this contributed to the deficiencies in the procedures adopted by the company. However the procedures adopted were so lacking in basic fairness that the small size of the company cannot excuse them.

[30] In respect to Section 387(h) as foreshadowed earlier I consider that the inability for Mr Richardson to request a support person and the lack of any warning concerning the earlier accidents to be relevant factors which support a finding that dismissal was unfair.

Was the dismissal unfair?

[31] I have balanced the effect on the procedures adopted because Surfcoast Laundry is a small business lacking human resource management expertise against the other factors listed in Section 387. I am satisfied that the lack of procedural fairness and the lack of a valid reason mean that I am satisfied that the dismissal was harsh and unjust and unreasonable.

Remedy

[32] I am satisfied that reinstatement would not be appropriate in this case as Mr Richardson has found other employment and does not seek reinstatement.

[33] I consider it appropriate to make an order for compensation.

[34] I am required to consider the following matters in determining compensation (Section 392(2)):

“Criteria for deciding amounts

(1) 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.”

[35] Mr Ho gave evidence that the company profits in the previous year was about $70,000. He gave evidence that the partners were unhappy about the level of profits and that an award of compensation may affect decision making about the number of employees in the business. I am not satisfied that Mr Ho’s evidence supports a conclusion that any award of compensation I might make would affect the viability of the business.

[36] The period of service of 20 months is not particularly short given the nature of the industry.

[37] Surfcoast Laundry submitted that Mr Richardson would not have been employed for any further period had the dismissal not occurred. They had other available labour. Mr Richardson pointed to the positive references he had received from clients. Mr Richardson argued that employment would have continued indefinitely if the complaint about pay had been resolved properly. Given the size of the business and that there were some legitimate concerns about the number of accidents in the previous twelve months and the period of prior employment I consider that Mr Richardson would have remained in employment for at least six further months if the dismissal had not occurred.

[38] The period between the dismissal and the date of this decision is 22 weeks. During that period Mr Richardson would have earned $24.33 per hour x 38 hours per week x 22 = $20,339.88. This amount does not include superannuation. Mr Richardson has earned $2,800 from employment in the period. He obtained a new casual job four weeks’ ago and is earning $700 gross per week. I am unsure if this amount includes superannuation. This leaves an amount of $17,539.88. I will deduct 10% for contingencies given the uncertainties about hours of employment and superannuation. I need to balance the evidence from Mr Richardson that he usually worked more than 40 hours each week against the possibility that the hours might have been reduced due to business needs. This leaves an amount of $15785.89.

[39] I accept Mr Richardson’s evidence that he has made reasonable efforts to find new employment and no deduction should be made in this respect.

[40] Four weeks remain of the 26 week period I estimate employment would have continued but for the dismissal. In the remaining four weeks Mr Richardson would have earned $3,698.16. I will deduct 20% for contingencies from that amount due to the increased uncertainties leaving an amount of $2,958.53.

[41] This leaves a total compensation amount of $18744.42

[42] I have not included any amount for shock, distress or humiliation as I am prevented from doing that under the Act. I have also not taken into account the issue of underpayment of wages. This matter may be dealt with separately through the Fair Work Ombudsman.

[43] I have found that the three accidents in a twelve month period did contribute to the decision to dismiss Mr Richardson and I accept that some of that was due to errors or misjudgement by Mr Richardson. Mr Richardson conceded this. I consider that a deduction of 20% for misconduct should be made. The remaining compensation amount is $14995.54.

[44] Taking into account each of the factors specified in Section 392(2) I will therefore award compensation of $14995.54 from which taxation should be deducted according to law. The amount is payable within twenty one days. Surfcoast Laundry is at liberty to apply to vary the time period for the payment. An order to this effect is issued in conjunction with this decision.

COMMISSIONER

Appearances:

Mr S Richardson on behalf of himself

Mr E Ho on behalf of the respondent

Hearing details:

2017.

Melbourne:

April 13.

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<Price code C, PR592450>