| [2019] FWC 5034 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
Mr Dylan Hans
v
QS Law Pty Ltd T/A Quinn and Scattini Lawyers
(U2018/11285)
COMMISSIONER BOOTH |
BRISBANE, 25 JULY 2019 |
Application for an unfair dismissal remedy – minimum employment period – redundancy – harsh, unjust and unreasonable – no compensation ordered.
[1] Mr Dylan Hans has applied to the Fair Work Commission (the Commission) under s.394 of the Fair Work Act 2009 (Cth) (FW Act) for a remedy, alleging he had been unfairly dismissed from his employment as a solicitor with QS Law Pty Ltd T/A Quinn and Scattini Lawyers (the Respondent), an incorporated legal practice. The Applicant seeks an order for the payment of compensation. He does not seek reinstatement. The Respondent denies the Applicant was unfairly dismissed and raises a jurisdictional objection.
[2] The Applicant was employed by the Respondent as a Criminal Lawyer, on a full-time basis, from 17 July 2017 until the termination of his employment. The date of the termination is disputed. The Respondent stated that the Applicant’s employment was dismissed on 12 October 2018 with payment in lieu of notice, and on 16 October 2018 “summarily dismissed” for misconduct discovered by the Employer after 12 October. The Applicant submits the termination date was 12 October 2018.
[3] The Applicant was originally employed to work at the Respondent’s Ipswich office; however, in June 2018 the Respondent decided to discontinue operating at this location, except for use as a visited office, until expiration of the lease at the end of June 2019.
[4] On discontinuance of operations at the Ipswich office, the Applicant’s role became redundant. He received a letter from the Respondent on 15 June 2018 headed “Termination of your employment by reason of redundancy”. The letter provided that the Applicant’s position at the Ipswich office would be made redundant, with effect from the end of the working day on 6 July 2018. The letter made an “Offer of Alternative Employment” at the Respondent’s Cleveland office. The Applicant accepted the offer of redeployment and signed a new employment agreement including additional remuneration. The Respondent’s case includes that the Applicant refused to move to the Cleveland office, a matter the Applicant disputes.
[5] On 12 October 2018 (the Applicant’s last day before two weeks’ planned leave) a termination letter was hand-delivered to the Applicant by his team leader, Mr Scott Casey, at the Ipswich office. The letter relevantly provides as follows:
“Dear Dylan
TERMINATION OF YOUR EMPLOYMENT
Your probation period with us at Quinn & Scattini is due to end on 9 January 2018. 1 We have decided not to continue your employment with the firm and your employment is therefore terminated effective immediately.
Based on your probation period, the notice period is one week this will be paid in your termination pay in the next pay run on 18 October 2018 together with any leave entitlements…”
[6] The letter gave no other reason for the dismissal.
[7] The Applicant’s evidence is that, after he prompted Mr Casey, he was told his employment was being terminated for “not following directions”. 2
[8] Following the termination of the Applicant’s employment, the Respondent alleged misconduct on the part of the Applicant, some taking place before the termination on 12 October and some after, as discussed below.
[9] Section 390 of the FW Act provides that the Commission may order a remedy if:
(a) the Commission is satisfied that the Applicant was protected from unfair dismissal at the time of being dismissed; and
(b) the Applicant has been unfairly dismissed.
[10] Both limbs must be satisfied. I am therefore required to consider whether the Applicant was protected from unfair dismissal at the time of being dismissed and, if I am satisfied that the Applicant was so protected, whether the Applicant has been unfairly dismissed.
[11] Section 382 of the FW Act provides that a person is protected from unfair dismissal if, at the time of being dismissed:
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and
(b) one or more of the following apply:
(i) a modern award covers the person;
(ii) an enterprise agreement applies to the person in relation to the employment;
(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.
[12] Section 385 of the FW Act provides that a person has been unfairly dismissed if the Commission is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
[13] At the Hearing in this matter, the Applicant sought to be represented by Mr M Rawlings of Counsel under s.596(1) of the FW Act.
[14] Having considered all relevant matters, including the matters to be considered under s.596(2) of the FW Act, I determined that it was appropriate to allow the Applicant to be represented by Counsel, having regard to the complexity of the matter and its efficient dealing.
[15] The Respondent was represented by Mr Leneham, Solicitor, and a Director of the Respondent.
Witnesses
[16] The Applicant gave evidence on his own behalf.
[17] The following witnesses gave evidence on behalf of the Respondent:
• Mr Timothy John Ryan, Solicitor and a Director of the Respondent;
• Ms Toni Marie Murphy, Practice Manager for the Respondent; and
• Mr Scott Liam Casey, Senior Associate and Team Leader of the Respondent’s Criminal Law Team.
Submissions
[18] The Applicant filed submissions in the Commission on 19 December 2018. The Respondent filed submissions in the Commission on 9 January 2019.
[19] Final submissions were filed by the Respondent on 23 March 2019. Final submissions were filed by the Applicant on 5 April 2019. The Respondent also filed further submissions in reply on 27 April 2019.
Initial matters
[20] Under s.396 of the FW Act, the Commission must decide the following matters before considering the merits of the application:
(a) whether the application was made within the period required in subsection 394(2);
(b) whether the person was protected from unfair dismissal;
(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;
(d) whether the dismissal was a case of genuine redundancy.
Was the Applicant protected from unfair dismissal at the time of dismissal?
[21] Mr Hans will be protected from unfair dismissal if he has completed the minimum period of employment, described in sections 383 and 384 of the FW Act as follows:
“383 Meaning of minimum employment period
The minimum employment period is:
(a) if the employer is not a small business employer—6 months ending at the earlier of the following times:
(i) the time when the person is given notice of the dismissal;
(ii) immediately before the dismissal; or
(b) if the employer is a small business employer—one year ending at that time.”
(1) An employee’s period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee.
…”
(Emphasis added)
[22] It was not in dispute and I find that the Respondent is not a small business employer, having 15 or more employees at the relevant time. However, the relevant dates of employment and dismissal are in dispute.
Respondent’s submissions on minimum employment period, second contract and probation period
[23] The Respondent submits that Mr Hans was dismissed on 12 October 2018 or 16 October 2018, during his probationary period which was less than the required 6 months. This is because he began a second and distinct period of employment from 9 July 2018, after termination of the Applicant’s former position by redundancy.
[24] The Respondent submits that while the two periods of employment were “almost consecutive”, 3 there were two distinct periods of employment, the first ending on Friday 6 July 2018 by reasons of dismissal for genuine redundancy, and the second beginning the following Monday 9 July 2018.4 The Respondent submits that this was a break in employment and means that the Applicant’s employment period with the Respondent was not continuous, and it submits that there is nothing in s.384(2) of the FW Act to contradict such a conclusion.5
[25] The Respondent submits that the Applicant’s previous position at the Ipswich office became redundant on 15 June 2018, and that the Applicant accepted a new offer of employment to work at the Cleveland office from 20 June 2018. The Ipswich office became an unstaffed, visited office after 30 June 2018. 6
[26] The Respondent submits that upon the Ipswich role being made redundant, the Applicant negotiated an additional $3,000 in salary, to compensate for the additional travel required if he accepted the role at the Cleveland office. This was agreed to; however, the Respondent submits the Applicant refused to move to the Cleveland office, and remained at the Ipswich office until he was dismissed on 12 October 2018. 7
[27] In its closing submissions, the Respondent supports its jurisdictional objection to the Applicant’s application on the basis that the Applicant failed to complete the required period of employment in order to bring an application for unfair dismissal remedy. Contrary to its previous submission that the Applicant became subject to a second contract on 20 June 2018, the Respondent submits that the Applicant began a second and distinct period of employment with the Respondent from 9 July 2018. This period of employment then came to an end on 12 October 2018.
[28] In support of the termination of June/July 2018 being a valid termination, the Respondent submits:
“(a) There can be no doubt that the respondent was entitled to make the applicant’s position redundant.
(b) There can be no doubt that it was a genuine redundancy – that the applicant’s position was in fact redundant as a result of the respondent’s decision to close the Ipswich office, temporarily reducing it to a visited office, and removing all staff from that office. (The Ipswich office is now permanently closed, since 8 February 2019.)
(c) There is no issue with the process taken by the respondent to effect the applicant’s redundancy.
(d) In short, there can be no doubt that the applicant’s employment was validly and utterly terminated by reason of redundancy.
(e) In that circumstance, the only basis on which the applicant could be employed by the respondent was by starting a new period of employment.
(f) The applicant not only signed a new employment agreement; he negotiated the terms of it, including a higher salary.
(g) The different terms of employment (salary, location, new probationary period) corroborate that the previous employment had been terminated and new employment had commenced.
(h) The applicant did not demur to that process.
(i) The documents given to the applicant on 14 June 2018 (which must be the correct date, even though the letter is dated 15 June 2018) included the Fair Work Information Statement which pursuant to section 125(1) of the Act is required to be given to the employee “before…the employee starts employment”.” 8
[29] The Respondent disputes the Applicant’s submission that the second contract of employment was merely executed to effect a change in location. Instead, the Respondent submits: “The solitary purpose of that [second] contract was to establish an employment relationship after the termination of the applicant’s former employment by redundancy”. 9
[30] Further the Respondent submits:
“If the applicant had not wanted to agree to a new position and a new probationary period, he was able to refuse the offer or to negotiate (as he had negotiated previously and in fact negotiated other terms of this new contract)”. 10
Applicant’s submissions on minimum employment period, second contract and probation period
[31] The Applicant submits that the imposition of a second probation period, from 15 June 2018, was unreasonable. 11 He submits that any reliance on the probation period is irrelevant, as he had exceeded the minimum employment period of six months and was therefore protected from unfair dismissal in accordance with s.382 of the FW Act.12
[32] The Applicant summarises the Respondent’s position about probation as follows:
“a. The Applicant’s employment was made redundant by notice on 14 June 2018;
b. The Applicant’s employment was terminated on Friday, 6 July 2018;
c. The Applicant commenced a subsequent period of employment on Monday, 9
July 2018;
d. The Applicant entered a contract which contained a probation clause freely, and without objection;
e. It would be unfair and unjust for the Commission not to give effect to the contractual terms;
f. There were no issues with the redundancy process in June 2018, as such, the
Commission should find that the Applicant’s employment was terminated;
g. The newly executed contract evinces the commencement of new employment.” 13
[33] The Applicant disputes this position, stating that the Respondent has failed to refer to any supporting case authorities, and further that their position is incorrect in fact and at law. 14
[34] The Applicant further submits that the Respondent only attempted to raise the jurisdictional objection (that the Applicant had not met the minimum period of employment within the meaning of s.383(a) of the FW Act) for the first time at the Hearing in this matter. 15 Despite this, the Applicant maintains that the purported dismissal of July 2018 was not a dismissal within the meaning of s.386(1)(a) of the FW Act, and was not a case of genuine redundancy within the meaning of s.389 of the FW Act.
[35] The Applicant submits that, in any event, he maintained a continuous period of employment with the Respondent. 16 He makes this submission on the basis that following 15 June 2018, the Respondent initiated a redeployment process, rather than a termination of the Applicant’s employment. The Applicant submits that in redeploying him to a reasonable alternative position, the Respondent has failed to exhibit an intention to bring the employment relationship to an end.17
[36] The Applicant submits that, on accepting the Respondent’s offer of redeployment on 20 June 2018, this established an unbroken period of employment. 18 He submits that he was employed for a continuous period with the Respondent from 28 May 2017 to 12 October 2018, and that the following evidence is further proof of this continual employment relationship:
a. The payslip up to 6 July 2018 had the employer listed as QS Law Pty Ltd;
b. The payslip up to 19 October 2018 had the employer listed as QS Law Pty Ltd;
c. The contract of employment commencing from 29 May 2017 was between Quinn and Scattini Lawyers and the Applicant personally;
d. The contract of employment commencing from 9 July 2018 was between Quinn and Scattini Lawyers and the Applicant personally;
e. Notwithstanding (d), the Respondent redeployed the Applicant prior to 9 July 2018 by placing him as a solicitor in the Cleveland office;
f. The unchallenged oral evidence of the Applicant; and
g. The oral evidence of a director of the Respondent, Mr Tim Ryan. 19
[37] The meaning of genuine redundancy and redeployment is outlined in s.389 of the FW Act.
“389 Meaning of genuine redundancy
(1) A person’s dismissal was a case of genuine redundancy if:
(a) the person’s employer no longer required the person’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and
(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.
(2) A person’s dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:
(a) the employer’s enterprise; or
(b) the enterprise of an associated entity of the employer.”
(Emphasis added)
[38] The Respondent’s submission that the position held by the Applicant was made redundant in June/July 2018 is supported by the Respondent’s evidence about closing the Ipswich office and that it no longer required the Applicant’s job at Ipswich to be performed by anyone, due to the changes in the operation requirements of the Employer’s enterprise. Such an explanation was provided to the Applicant at the time he was offered another position within the Employer’s enterprise.
[39] The Employer’s offer and Mr Hans’ acceptance of redeployment is not changed by the increase in wages (which was at least in part to accommodate the extra travel of the Applicant) nor by execution of a further contract. Other indicia, such as the pay-out of leave and a so-called probation, do not change the legal nature of the offer of redeployment and its acceptance. The redeployment continued the employment, and did not “reset” the employment relationship on its acceptance. As to continuity, completing work on Friday afternoon in one location and starting the “new position” the following Monday nominally at a different location is another clear indicia of continuous employment.
[40] The Applicant was offered redeployment. He accepted it. There was no dismissal at that time.
Conclusion on Period of Employment
[41] The Applicant was employed for longer than the minimum period of employment and is therefore a person protected from unfair dismissal. To the extent the Respondent raised this as a jurisdictional objection, the objection is dismissed.
[42] Section 387 of the FW Act provides that, in considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the Commission must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person – whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that the FWC considers relevant.
[43] I am required to consider each of these criteria; to the extent they are relevant to the factual circumstances before me. 20 I do so below.
[44] In order to be a valid reason, the reason for the dismissal should be “sound, defensible or well founded” 21 and should not be “capricious, fanciful, spiteful or prejudiced.”22 However, the Commission does not stand in the shoes of the Employer and determine what the Commission would do if it was in the position of the Employer.23
Respondent’s submissions
[45] The Respondent submits that if the Commission does not accept that the Applicant has failed to meet the minimum employment period required to bring his application, the following should be considered in addition, or in the alternative, to its submissions.
[46] The Respondent submits that the Applicant was subject to a “Termination on notice” on 12 October 2018. The Respondent submits that it was entitled to rely on all reasons for dismissal that were available to it, even if the reasons were not communicated to the Applicant as the reasons for the dismissal. It submits that the reasons for dismissing the Applicant that were available to it were as follows:
“(a) Incompetence in the handling of cash.
(b) Incompetence by missing a court date for clients.
(c) Refusal to follow direction to move to the Cleveland office.
(d) Failure to comply with office procedures.
(e) Leaving the office during office hours without authorisation, in breach of clause 10(b)(i) of the second employment contract.
(f) The grounds referred to in these submissions under the heading of “Serious misconduct”. 24
[47] The “serious misconduct” mentioned in (f) is summarised as follows: 25
• Stealing from the Respondent by:
1. doing work for no fee,
2. sending, during work time, the respondent’s intellectual property to Natasha Shorter, 26
3. sending the respondent’s intellectual property to himself- which the applicant attempted to do after the termination on the 12 October. The respondent alleges the documents included precedent documents, details of clients and their cases including some documents created in 2104 before the applicant was employed; a marketing document
• breaching the ethical duty of confidentiality to clients
• rendering assistance to a business rival, Ms Shorter
• refusing to move to Cleveland which undermined Clause 25(b)(vii) of the second employment contract
• breaching of a fundamental duty to maintain client confidentiality.
[48] The Respondent disputes the Applicant’s submission that the dismissal of 12 October 2018 was “with notice paid in lieu”. 27 The Respondent refers here to the dismissal letter of 12 October 2018, which provides:
“Based on your probation period, your notice period is one week, this will be paid in your termination pay in the next pay run on 18 October 2018 together with any leave entitlements”.
[49] The Respondent submits the Applicant was dismissed on this date with one week’s notice and with his final payment to be made the following week – not with pay in lieu of notice. 28
Facts acquired after the dismissal and the 16 October 2018 dismissal notice
[50] The Respondent submits that subsequent to the termination with notice on 12 October, it became aware of misconduct by the Applicant, and effected a “summary termination for misconduct” by way of letter attached to an email dated 16 October 2018, over the signature of Tim Ryan, Director of the Respondent, as follows: 29
“We refer to our meeting today.
As discussed, an instance of serious misconduct has come to our attention.
Specifically, it was discovered that you sent confidential information belonging to Quinn and Scattini Lawyers Pty Ltd (the Company) to your private email address.
…
In addition to this your outlook 30 evidences that you have forwarded confidential client information to a Lawyer at another Law Firm.
Such conduct is considered serious misconduct…
In the circumstances, and for the reasons as outlined above, we maintain the view that it is appropriate that your employment should be terminated, as this was the case on Friday, 12 October, 2018 by way of a meeting with Scott Casey, your Team Leader.
… due to your serious misconduct and breach of your Employment Contract there will be no one weeks’ payment notice.”
[51] The Respondent submits that, despite the termination of 12 October 2018 being communicated as effective immediately, the employment relationship continued for the notice period of one week ending on 18 October 2018. Therefore, the Respondent submits that the 16 October 2018 summary dismissal occurred during that notice period, 31 and therefore the relevant dismissal date is 16 October 2018,32 as “the summary dismissal for serious misconduct trumps all other issues”.33
[52] The Respondent submits that the alleged misconduct involved the Applicant:
• providing confidential and proprietary documents to a third party, business competitor of the Respondent; and
• misappropriating, and attempting to steal, confidential and proprietary documents from the Respondent, by attempting to send them to the Applicant’s private email address. 34
[53] The Respondent identifies 35 two dates for the alleged misconduct discovered by the Respondent after the 12 October 2018 termination: 19 September 2018 and 12 October 2018.
Valid Reason
[54] Did the Respondent have a valid reason for the dismissal?
[55] As part of deciding whether there is there a valid reason, the Respondent states that I should take into account all of the alleged misconduct including conduct that occurred after the termination on 12 October. The details are described in paragraphs [46] and [47] above.
[56] The reason for the termination need not be that given by the Employer: a valid reason can be any reason underpinned by the evidence provided to the Commission. 36 However, a finding of a valid reason other than a reason given to the Applicant may still have implications for the Respondent in terms of the requirements for procedural fairness under s.394.
[57] Reasons can also include facts acquired after the dismissal, such as those said by the Respondent to be the Applicant’s misconduct. The Applicant here denies any such misconduct but acknowledges that after acquired knowledge of misconduct may be taken into account in deciding whether an Applicant’s dismissal is valid.
[58] The Applicant’s submission is that this consideration is limited to conduct that occurred during the Applicant’s employment and not conduct after the employment was terminated.
[59] It is well understood at law that facts justifying dismissal existing at the time of dismissal can be taken into account by the Commission even if the Employer was unaware of the facts, and did not rely them, at the time of dismissal. 37
[60] Mr Hans admits to attempting (ultimately unsuccessfully) to transfer documents to a USB storage device. On his evidence, this was done with consent of the Applicant’s Team Leader. He further submits that facts relied on as reasons for dismissal must exist at the time of dismissal, namely before the dismissal which was effected by the 12 October letter. The allegations around the USB transfer therefore cannot form part of the dismissal as that conduct occurred after he was dismissed by hand-delivered letter.
[61] The Respondent asserts that the Applicant was dismissed on 12 October with one week’s notice, with the final payment to be made the following week. The Respondent denies that pay was to be made in lieu of notice. Further, the Respondent states that the reason for the termination need not be that which was given by the Employer.
[62] This includes behaviour that occurred prior to the dismissal on 12 October and the conduct that occurred after the Applicant was handed a termination notice on 12 October 2018. The relevant part of the termination letter is repeated here. It states:
“Based on your probation period, your notice period is one week, this will be paid in your termination pay in the next pay run on 18 October, 2018 together with any leave entitlements”.
[63] The Applicant asserts that the giving of the letter on 12 October 2018 was intended to, and did in fact, terminate the employment. In support of this submission he relies on: the words of the termination notice that the employment was “terminated effective immediately”; his own oral evidence that he understood he was being dismissed; 38 and the oral evidence of Mr Casey, his supervisor, to the effect that he understood handing the letter to the Applicant meant that the Applicant was terminated immediately.
[64] In my view, and as detailed below, the evidence supports a conclusion that the termination on 12 October 2018 took effect immediately on the letter being handed to Mr Hans.
[65] The fact that the letter also dealt with the notice period and the administrative process for payment of monies had no effect on the clear and unambiguous termination, accepted by the Applicant and confirmed by Mr Casey, acting with the Respondent’s authority.
[66] The second termination letter was sent by email on 16 October 2018, while the Applicant was overseas on leave. While it purported to terminate the Applicant’s employment without notice for serious misconduct, it could not and did not override the termination of 12 October. 39
[67] I conclude that the conduct that can be relied on to decide whether there is a valid reason is conduct prior to Mr Hans being handed the termination notice on 12 October, whether known to the Respondent at that time or not. This is because the Commission is bound to determine whether, on the evidence provided, facts existed at the time of termination that justified the dismissal. 40
[68] The issues around the Applicant’s conduct subsequent to being terminated on 12 October 2018 are matters that may be considered in terms of the discretion as to remedy 41 and I have considered this conduct in these terms.
[69] Therefore, the Applicant’s alleged misconduct that may be considered by this Commission in deciding whether there is a valid reason for the dismissal are in two categories:
1. conduct that occurred during the Applicant’s employment that was known to the Respondent at the time of dismissal; and
2. conduct that occurred during the Applicant’s employment that was not known to the Respondent at the time but was in evidence at the Hearing.
Conduct that occurred during Applicant’s employment and was known to the Respondent
[70] The conduct relied on by the Respondent and known to the Respondent before dismissal includes:
• the Applicant’s refusal to move to the Cleveland office;
• alleged incompetence issues;
• the Applicant doing work not authorised by his employer;
• failure to comply with office procedures; and
• the Applicant leaving the office without authorisation.
Refusal to move to Cleveland Office
[71] On the allegation of the refusal to move to the Cleveland office, the Respondent submits:
“The applicant repeatedly refused to follow a lawful direction given by the respondent. In fact it was not a mere direction, it was a fundamental term of the new employment contract that the applicant would be based at the Cleveland office”. 42
[72] The Respondent relies on an email chain in support of the allegation, including the following.
• On 10 July an email (having thought that the move had taken place on 29 and 30 June) proposed “we need you to move by 16 July”. Mr Hans indicated in his email “Tim advised that my last week in Ipswich was 6 July…”. However, Mr Hans did not welcome the decision, and asserts there was a lack of consultation about it. Mr Hans expresses his views and concludes with some comments about a “totalitarian regime”.
• In response on 11 July, Ms Murphy confirms the direction to move is “from the Directors.”
• In September Mr Hans was still working out of the Ipswich office. Indeed he complains about certain safety matters at Ipswich and the emailed reply from the employer reiterates that Ipswich is a visited office.
• On 6 September Ms Murphy again states that Mr Hans’ base office is Cleveland.
[73] Evidence in support of the Respondent’s claim included a series of photographs of the Ipswich office taken immediately after the dismissal on 12 October. Mr Hans indicated that the “number of manila files on a desk would appear to be consistent with the files that I had, but again I can't say with any certainty”. 43
[74] The Applicant submits that there was no lawful and reasonable direction to him to relocate to the Cleveland office and that there is no evidence of a refusal to comply.
[75] The email trail above outlines the expectations of the Respondent in terms of his relocation to Cleveland. This is explicit. The photographic evidence at least indicates a significant number of Mr Hans’ files were still located at the Ipswich office on the date of the termination.
[76] The Applicant clearly agreed to relocate in June 2018 and was paid an extra $3000 as part of the redeployment negotiations. Despite this, he had not relocated by October 2018.
[77] I conclude there was a clear direction to relocate; the direction was reasonable in the context of the closure of the Ipswich office, the redeployment negotiations, and the revised contractual arrangements; and that Mr Hans did not comply with the direction.
[78] Whether the failure to relocate was because Mr Hans wanted to establish his own practice in the Ipswich area, as suggested by the Respondent in cross-examination, is not relevant in these circumstances. Mr Hans did not comply with a reasonable direction over some months despite a number of requests to do so, his agreement to relocate, and acceptance of an extra $3000 in salary to relocate.
[79] There was also some evidence about a possible alternative move to Beenleigh, requested by the Applicant. In that regard, I prefer the evidence of Mr Casey that the alternative move had not been approved in any way. In fact, such a request from the Applicant emphasises the lack of compliance with the direction to move from the Ipswich to the Cleveland office.
[80] The Applicant submitted that, despite Mr Casey and Mr Ryan’s evidence, the Respondent did not present any evidence that a direction was ever given, and in cross-examination rejected the proposition that he refused to relocate.
[81] I do not agree. The evidence shows in clear terms that a direction was given in the contract and the email chains, as confirmed in oral evidence at the Hearing. The Applicant may have put up barriers to relocating, and continued to work from the Ipswich office and elsewhere, but that does not mean there was no direction. Indeed, Mr Hans remained resolute, up to and including during cross-examination: he did not need to comply with the directions to relocate to Cleveland.
[82] I agree with the Respondent’s submissions on this point that relocation was not optional, was a reasonable direction, and was well understood by the Applicant. The Applicant did not relocate and was therefore not compliant with a lawful, reasonable direction by the Employer.
[83] The refusal to relocate to the Cleveland office is a valid reason for the dismissal.
Serious misconduct?
[84] The Respondent also submits that the refusal to relocate to the Cleveland office undermined the Employer’s business and was a breach of the serious misconduct clause in the second employment contract.
[85] Mr Hans was required by his Employer’s instructions to relocate to the Cleveland office. The instructions from his Employer were lawful and reasonable, yet they were not complied with over a long period.
[86] Whether Mr Hans’ conduct amounted to misconduct serious enough to give rise to a right to summarily dismiss him is not relevant to the question of the validity of the reason under section 387(a), 44 but it is a relevant matter to be taken into account as an “other matter” under section 387(h).45
Allegations of incompetence, failure to comply with office procedures, doing unauthorised work and leaving the office without authorisation
[87] Other allegations against the Applicant, known to the Employer at the time of termination on 12 October, concern incompetence issues, doing unauthorised work, failure to comply with office procedures, and leaving the office without authorisation.
[88] These other stated reasons for dismissal concern conduct, performance, or competence. None of them is a valid reason for dismissal but may have given the Employer cause to counsel Mr Hans and possibly even warn him. However, there is no evidence that the concerns were formally raised with Mr Hans by the firm’s Directors or administrators, or that any corrective action was taken. Even cumulatively, the alleged short comings of conduct or performance, in the absence of managerial action, do not establish a valid reason for the dismissal.
[89] These other allegations cannot, on an objective analysis of the facts and the circumstances put to the Commission in the Respondent’s evidence, justify termination.
[90] On that basis these allegations are not valid reasons for dismissal.
Conduct that occurred during the Applicant’s employment that was not known to the Respondent at 12 October
Stealing from the Respondent by sending the Respondent’s intellectual property to Natasha Shorter (described as a business competitor) during business hours; Confidentiality breaches
[91] The documents sent by the Applicant to Ms Natasha Shorter, on three separate occasions, were: the Applicant’s file list; a document entitled “letter to the Applicant”; and a document entitled “SHO Affidavit”.
[92] The file list is a 14 page document which summarises criminal charges against applicant’s clients, details of the individuals’ court proceedings, the barrister for each matter, and certain financial matters. The letter to the Applicant is a one page letter about potential consequences where a client has not progressed their application. The “SHO” document is a four-page affidavit setting out issues which clearly need to be addressed “in special hardship” in relation to work licenses.
[93] The Respondent submits the sending of these documents to Ms Shorter is capable of constituting serious misconduct and describes the sending of the documents to Ms Shorter as “stealing”. 46 It submits that the documents were confidential, proprietary information, and the Respondent’s intellectual property. The Respondent relies on the misconduct notwithstanding it was not known to the Respondent at the time of the Applicant’s dismissal.
[94] The Applicant admits to sending documents to Ms Shorter. However, he suggests that a significant amount of material is not confidential, and further suggests that neither the letter to the Applicant nor the SHO affidavit is proprietary information as these documents were, on their face, transmitted to other parties in litigation in the courts. As to the Applicant’s File List, the Applicant submits that it was originally held in the name of the Applicant and was originally provided to him by Ms Shorter. It does not contain any operational practices, procedures or references of a commercially sensitive type. It was similar to other documents used by another law firm and, with the exception of the fees, the content is in the public domain. Further he submits the Respondent has failed to show on the evidence that Ms Shorter is in fact a competitor of the Respondent.
Stealing from the Respondent
[95] The Applicant submits that the allegation that the giving of the documents amounts to stealing was not raised with the Applicant at any time prior to the Respondent’s written submissions.
[96] He submits that, because the Respondent did not put the allegation of such misconduct to him in cross-examination the rule in Browne v Dunn 47 applies, and the Commission as a forum of fact is therefore constrained in its ability to make adverse finding in terms of those allegations.
Was there a valid reason for the dismissal based on the Shorter allegations/confidentiality breaches?
[97] The Applicant admits that he provided his Employer’s documents to Ms Shorter but submits the Respondent bears the onus of showing not only that the alleged conduct occurred but that it constitutes serious misconduct.
[98] While the onus is on the Employer to establish the conduct occurred, and on the Applicant’s own admission it is clear that it did, it is not the case that the test to be applied in weighing up the validity of the reason for dismissal is whether the conduct constitutes serious misconduct.
[99] Characterising conduct as “serious misconduct” does not change the test. It remains one of the validity of the reasons for dismissal. That is, the validity of the reason does not depend on whether or not the termination was on notice 48 but whether the reason was sound, defensible or well-founded.
[100] Given the serious nature of the allegations, the misconduct having been described in criminal terms as “stealing”, the Applicant submits, and I agree, that the principle stated by Dixon J in Briginshaw v Briginshaw applies:49
“. . . Reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of the given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters "reasonable satisfaction" should not be produced by inexact proofs, indefinite testimony, or indirect inferences”.
(Emphasis added)
[101] Therefore in assessing whether the conduct of sending documents to Ms Shorter, a former employee of the Respondent, is a valid reason on which termination should occur I am required to take into account the surrounding circumstances in which this occurred noting the Briginshaw principle, given the alleged criminality. 50
[102] The Applicant states that I should take into account that the documents themselves had minimal sensitive information, and though there was an assertion of a gain of commercial advantage for Ms Shorter, there was no relevant evidence before the Tribunal.
[103] There was also significant evidence about industry practice within criminal law by way of sharing of documents. The evidence on this point demonstrated a convergence of views.
[104] Mr Casey, the Applicant’s supervisor at the time of the termination, told the Commission he had received precedents from other law firms, although he had never sent any. 51
[105] Mr Leneham, from the bar table (after the Applicant withdrew) made the following comment:
“… It’s never been stated as a general principle that one practitioner ought not to send a precedent document to another practitioner. This is limited to the facts of this case and the documents in this case.” 52
[106] I accept that providing precedents to another practitioner will be of assistance to them. That is the very nature of the practice of sharing precedents. I do not think that the Applicant can be criticised for this. Nevertheless, I conclude he should have thought whether sending “Dylan’s list” to Ms Shorter was appropriate. On balance it would seem it was not appropriate; however I accept the Applicant’s comment that, from his point of view, it was a template of how to categorise clients. 53 Nevertheless, it did contain confidential information about clients and the Respondent’s business.
[107] As to sharing precedents generally, Mr Leneham invites the Commission to conclude that while there is an established industry practice, the Applicant should have known that in these particular circumstances the general practice did not apply.
[108] The evidence before the Commission was that there is industry practice of some precedent sharing, and the opinion of the Respondent that in these circumstances, sharing some or all of the information was not appropriate. In the light of the serious allegation by reference to “stealing”, and taking into account all the relevant circumstances, I conclude that the Respondent has not established to the necessary standard that the provision of documents to Ms Shorter, or the issues around confidentiality, constituted a valid reason for the termination.
[109] For the sake of completeness, the Respondent alleges the Applicant was doing “no work for no fee”. This is a matter which could have been the subject of counselling the Applicant. It falls significantly short of serious misconduct.
Conclusion on valid reason
[110] I find that there was a valid reason for the dismissal related to the Applicant’s failure to relocate to the Cleveland office.
[111] For reasons stated above, other allegations made by the Respondent are not valid reasons for the dismissal.
Was the Applicant notified of the valid reason?
[112] Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made to terminate their employment, 54 in explicit55 and plain and clear terms.56
[113] In Crozier v Palazzo Corporation Pty Ltd, 57 the Full Bench established the following:
“As a matter of logic procedural fairness would require that an employee be notified of a valid reason for their termination before any decision is taken to terminate their employment in order to provide them with an opportunity to respond to the reason identified. Section 170CG (3)(b) and (c) [of the previous Act] would have very little (if any) practical effect if it was sufficient to notify employees and give them an opportunity to respond after a decision had been taken to terminate their employment. Much like shutting the stable door after the horse has bolted”. 58
[114] The principle in Crozier v Palazzo Corporation applies under the current provisions of the FW Act.
Submissions
[115] The Applicant submits the Respondent did not provide any reason for dismissal at any time prior to the termination, nor did the termination notification provide a reason for dismissal with the required particularity. 59
[116] The Applicant’s evidence however is that dismissal was not unexpected. 60 He noted “that management didn’t have the guts to do it themselves”.61 His evidence was also that his supervisor relayed one reason included failure to obey directions.62
[117] Having dismissed the Applicant purportedly on the basis of probation on 12 October 2018, with no opportunity to respond on 12 October the Respondent cannot establish that it has satisfied the requirements of this section. 63
[118] As for the serious misconduct allegations, the Employer admits that these allegations were brought to the Applicant’s attention by email after the termination of his employment. The employer submits:
“(a) When the serious misconduct was first discovered by the respondent:
(i) The applicant was already away on leave (and was “overseas” from 13 October) and would never be returning to work due to the dismissal in reliance on the probationary period;
(ii) The only way for the respondent to contact the applicant was by email, which was done;
(iii) The applicant had already been given (in person) notice of the termination of his employment.” 64
[119] However, notification of the valid reason must occur before the decision is made to terminate. The sending of the email, after termination, also does not satisfy the requirements of the section.
[120] Therefore, the Respondent cannot establish that it has satisfied the requirements of notification of the valid reason.
[121] In all the circumstances, I find that the Applicant, although unsurprised by the dismissal, was not notified of the reason for his dismissal. I find in these circumstances that the lack of procedural fairness afforded to the Applicant was unjust.
Was the Applicant given an opportunity to respond to any valid reason related to their capacity or conduct?
[122] An employee protected from unfair dismissal must be provided with an opportunity to respond to any reason for their dismissal relating to their conduct or capacity. An opportunity to respond is to be provided before a decision is taken to terminate the employee’s employment. 65
[123] The Respondent’s reliance on 12 October 2018 on probation and the failure to notify any reasons for dismissal necessarily means the Applicant did not have any opportunity to respond to the reasons. I therefore find the lack of opportunity to respond is unfair.
Did the Respondent unreasonably refuse to allow the Applicant to have a support person present to assist at discussions relating to the dismissal?
[124] On the evidence before the Commission, the Applicant did not seek a support person. This factor is neutral in the circumstances.
Was the Applicant warned about unsatisfactory performance before the dismissal?
[125] Although some allegations about performance were raised informally, and there is no evidence of any warning, I have found these allegations did not constitute valid reasons for the dismissal. Therefore, this factor is not relevant to the present circumstances.
To what degree would the size of the Respondent’s enterprise be likely to impact on the procedures followed in effecting the dismissal? And, to what degree would the absence of dedicated human resource management specialists or expertise in the Respondent’s enterprise be likely to impact on the procedures followed in effecting the dismissal?
Submissions
[126] The Applicant submitted that the Respondent’s enterprise did not lack dedicated human resource management specialists or expertise.
[127] The Respondent submitted it had around 50 employees at the time of dismissal and no dedicated human resource management specialists.
[128] The Applicant submitted that an essential question about the size of the enterprise is whether the Employer is large enough to expect appropriate procedures to be put in place.
[129] The Applicant notes that as the Respondent practices law and provides advice to clients it should be expected that it engage in appropriate management of its employees. Its approach to the Applicant, in terminating his employment without a provision of reasons, without an opportunity to respond, and erroneously relying on the probationary period without any investigation is below the standard one would expect of this Employer.
[130] The Applicant submits the circumstances tend to establish that the termination was harsh.
[131] As to the human resource capacity of the Employer, the Applicant submits that both Ms Murphy and Ms Ebony Reid perform human resources duties.
Conclusion on impact on the procedures - Respondent’s enterprise size and human resource capacity
[132] The Respondent is a medium sized business with resources that reflect its size. I conclude that its size is a neutral factor in this matter. The fact that the Respondent is a legal firm does not demand a different standard in the way it manages its employees. All employers are subject to the requirements under the FW Act, and legal firms have no higher or lower standard than any other business of similar size.
[133] As to the human resource specialty, I have concluded that the role of Ms Murphy, demonstrated for example in the email exchange with Mr Hans at paragraph [72], concerning issues around the refusal to move to the Cleveland office, shows the very work that is expected of a human resources manager.
[134] I conclude the human resources capacity of the Respondent is a neutral factor. That is, it cannot be relied on by the Employer to explain a failure to use a fair process when effecting dismissal, but neither can be relied on by the Applicant to criticise the Employer in its conduct.
What other matters are relevant?
[135] Section 387(h) requires the Commission to take into account any other matters that the Commission considers relevant.
[136] The Respondent seeks a finding that various behaviours of the Applicant while working for the Employer could justify summary dismissal on the basis of serious misconduct.
Serious Misconduct
[137] Having concluded that the failure to relocate to the Cleveland office is a valid reason for dismissal, I turn to whether it could justify summary dismissal on the basis of serious misconduct.
[138] In my view, summary dismissal on the basis of the failure to relocate to the Cleveland office is disproportionate and cannot be relied on despite the existence of the valid reason for the termination. This is because serious misconduct requires wilful and deliberate conduct by an employee. 66 Mr Hans’ behaviour is more in the nature of a refusal to cooperate, with various excuses but nevertheless continuing to perform his duties adequately, rather than a wilful and deliberate failure to perform his duties or do his job as required. It is a valid reason to dismiss, but not to dismiss summarily.
[139] I have also considered the Respondent’s submissions about the contractual obligation in clause 25(b)(vii):
“Conduct by the Employee (whether or not the conduct occurs in the workplace) which has a tendency to bring Q&S into disrepute or a tendency to undermine the business of Q&S”.
[140] It may well be that this clause is not inconsistent with the FW Act and must be complied with by the employee.
[141] However, for the same reasons detailed above as to why the failure to relocate does not establish serious misconduct and a basis for summary dismissal, the Applicant’s behaviour was not of a quality which had a tendency to bring his Employer into disrepute or a tendency to undermine the business of the Employer.
[142] I conclude that the Employer cannot rely on clause 25(b)(vii) to justify summary dismissal.
[143] In any case, the actual dismissal (of 12 October 2018) was not summary but dismissal but on notice with payment for what the Respondent considered to be the relevant notice period.
Applicant claims aggravating features of dismissal
[144] The Applicant points to what is described as “aggravating features” of the dismissal: that an established and mature legal practice, providing legal advice, should comply with established industrial laws. Additionally the Applicant refers to an email that was sent to staff about the Applicant, stating that his employment was terminated for misconduct. He alleges the email was vindictive with the potential to injure his reputation.
[145] The Respondent does not particularly address this matter, however its generalised comments that serious misconduct “trumps all other issues” 67 would seem to indicate that the Respondent believed the behaviour as alleged of the Applicant is the most important matter in this case.
[146] For reasons detailed above the nature of the Employer’s business does not elevate the standard required of an employer in an unfair dismissal case.
[147] However, the sending of the email to all employees without putting these allegations to the Applicant tends to a finding of unreasonableness by the Employer.
[148] I must consider and give due weight to each criteria, in determining whether the termination was harsh, unjust or unreasonable. 68
[149] The FW Act requires the Commission have regard to a range of matters in determining whether a termination was harsh unjust or unreasonable. A finding in respect of any one of these matters is not in itself determinative. 69
[150] Where considerations conflict it is necessary to reach a conclusion as to whether, in all the circumstances, the termination is harsh unjust or unreasonable
[151] I have concluded that while the Applicant’s conduct and his refusal over an extended period to relocate to the Cleveland office is a valid reason for the dismissal, the complete lack of procedural fairness including the absence of being notified of the reason and no opportunity to respond to that reason and thereby challenge the decision to terminate, means that the termination was harsh, unjust and unreasonable.
[152] Having concluded that the termination was harsh unjust or unreasonable, I find that Applicant was unfairly dismissed.
Remedy
[153] Being satisfied that the Applicant:
• made an application for an order granting a remedy under section 394;
• was a person protected from unfair dismissal; and
• was unfairly dismissed within the meaning of section 385 of the FW Act,
I may, subject to the FW Act, order the Applicant’s reinstatement, or the payment of compensation to the Applicant.
Submissions
[154] The Applicant does not seek reinstatement, given that he has now established his own legal practice. The Employer likewise resists reinstatement. Therefore reinstatement is not an appropriate remedy.
[155] Having found that reinstatement is inappropriate, it does not automatically follow that a payment for compensation is appropriate. As noted by the Full Bench in Nguyen and Le v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter, “[t]he question whether to order a remedy in a case where a dismissal has been found to be unfair remains a discretionary one…”. 70
Compensation – what must be taken into account in determining an amount?
[156] Section 392(2) of the FW Act requires all of the circumstances of the case to be taken into account when determining an amount to be paid as compensation to the Applicant in lieu of reinstatement including:
(a) the effect of the order on the viability of the Respondent’s enterprise;
(b) the length of the Applicant’s service;
(c) the remuneration that the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed;
(d) the efforts of the Applicant (if any) to mitigate the loss suffered by the Applicant because of the dismissal;
(e) the amount of any remuneration earned by the Applicant from employment or other work during the period between the dismissal and the making of the order for compensation;
(f) the amount of any income reasonably likely to be so earned by the Applicant during the period between the making of the order for compensation and the actual compensation; and
(g) any other matter that the Commission considers relevant.
[157] I consider all the circumstances of the case below.
Effect of the order on the viability of the Respondent’s enterprise
[158] There is no dispute and I am satisfied that an order for compensation would not have an effect on the viability of the Employer’s enterprise.
Length of the Applicant’s service
[159] The Applicant’s length of service was in total 18 months.
Submissions
[160] The Respondent submitted that consideration of the Applicant’s length of service was short and should reduce any of compensation.
[161] I consider that the Applicant’s length of service is a neutral factor in this matter.
Remuneration that the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed
[162] As stated by a majority of the Full Court of the Federal Court in He v Lewin:
“[i]n determining the remuneration that the Applicant would have received, or would have been likely to receive… the Commission must address itself to the question whether, if the actual termination had not occurred, the employment would have been likely to continue, or would have been terminated at some time by another means. It is necessary for the Commission to make a finding of fact as to the likelihood of a further termination, in order to be able to assess the amount of remuneration the employee would have received, or would have been likely to receive, if there had not been the actual termination”. 71
Submissions
[163] The Applicant submitted that payment of compensation between 8 to 12 weeks’ pay is appropriate because:
• he had planned to commence his own firm in the first quarter 2019 and would be no longer employed by 31 March 2019;
• The amount sought adequately reflects the nature of the dismissal; and
• The Applicant submits that given the degree of tension in the employment relationship and the views of Ms Murphy on the nature of the contractual probation it is open to the commission to find the Applicant was unlikely to be employed after the end of contractual obligation probation i.e. 9 January 2019, reducing the upper limit 12 weeks.
[164] The Respondent resists any payment of compensation although it does not specifically address the question of likely remuneration to have been received, instead relying on its argument for summary dismissal and the allegations of breach of mutual trust and confidence, concluding that regarding Mr Hans’ employment, termination was the most probable and likely outcome.
[165] Email correspondence around the requirement to relocate to the Cleveland office demonstrated that the Applicant refused to move, and persistently resisted doing so. It is unlikely that the Applicant’s employment would have continued with the Respondent. Additionally, at the hearing of the matter the applicant was of the view that did not need to comply with the directions to relocate to Cleveland.
[166] If the Applicant had not been unfairly dismissed, I have concluded that his employment would not have been likely to continue and that he would have been terminated by other means. This is because of the Applicant’s consistent view, expressed even up to the hearing of this matter, that he was not required to relocate to Cleveland. On return from his planned leave, he would have been terminated by the end of the week. Therefore the amount of remuneration Mr Hans would have received, if he had not been dismissed, is one week’s pay. The Employer would also be obliged to comply with its obligations under the National Employment Standards in relation to the notice period, or, (as in this case) payment in lieu, for an employee who had been employed for more than one year. This is two weeks’ pay. Therefore the amount of remuneration Mr Hans would have received, if he had not been unfairly dismissed, is 3 weeks’ pay.
Efforts of the Applicant to mitigate the loss suffered by the Applicant because of the dismissal
[167] The Applicant must provide evidence that they have taken reasonable steps to minimise the impact of the dismissal. 72 What is reasonable depends on the circumstances of the case.73
Submissions
[168] The Applicant submitted he had taken reasonable steps to minimise the impact of his dismissal by taking steps to establish his own legal practice, and there is evidence that he did so on returning from his holiday.
[169] He admits that in those circumstances he did not seek “alternate employment”.
[170] The Applicant submits these were steps taken to mitigate his loss and that the Commission should reject the Respondent’s submissions that compensation should be reduced on the basis the Applicant did not apply for alternate jobs.
[171] The Respondent submitted that no compensation should be paid because:
• the Applicant made the decision to immediately go into business for himself; and
• he made no effort to mitigate his losses by attempting to obtain gainful employment, even on a temporary basis.
Conclusion as to mitigation
[172] I find that the Applicant took steps to mitigate loss by immediately working to fulfil the requirements necessary for him to establish his own legal practice. It has been held an Applicant may discharge their obligation to take reasonable steps to mitigate loss following from termination of employment by establishing a venture on his or her own account. Where this is the case it is generally appropriate to make some allowance for the deferred income in the calculation of compensation. 74
[173] I would reduce the amount by one week, taking into account the deferred income.
Amount of remuneration earned by the Applicant from employment or other work during the period between the dismissal and the making of the order for compensation
[174] I have made no deduction for the amount of any remuneration earned given the nature of the deferred income of the Applicant’s new legal practice.
Amount of income reasonably likely to be so earned by the Applicant during the period between the making of the order for compensation and the actual compensation
[175] For the same reason I have made no deduction on this basis.
Other matters and misconduct
[176] The FW Act requires me to consider if there are other matters in the circumstances of the case that I must take into account in determining compensation.
[177] Further, if I am satisfied that misconduct of the Applicant contributed to the Employer’s decision to dismiss, I am obliged by s.392(3) to reduce the amount I would otherwise order by an appropriate amount on account of the misconduct.
[178] The Respondent alleges the various types of misconduct, including serious misconduct, as detailed in paragraphs [46] and [47].
[179] In my view there are two particular matters that I consider relevant in determining the amount of compensation.
Shorter allegations/Breach of confidentiality
[180] The first is the forwarding of documents to Ms Shorter. Such misconduct can be taken into consideration notwithstanding the misconduct was not the basis of a valid reason for dismissal. The decision to forward confidential information about clients and the Respondent’s business to Ms Shorter was inappropriate. While I have found it did not constitute a valid reason to dismiss the Applicant, it nevertheless in my view falls short of the judgement and good faith and fidelity required of an employed solicitor.
Misconduct allegations after the dismissal
[181] The second is aspects of the Applicant’s attempts to copy or email various documents after the termination on 12 October 2018. The Commission heard at the Hearing considerable detail about these documents, and the Applicant was cross-examined at great length about both the circumstances of the attempted copying and emailing and the content of the many documents involved.
[182] While it is arguable that Mr Hans was impliedly permitted to make copies or email documents that were his, he did not limit his attempts to just those documents.
[183] The Respondent submits that there were three types of documents that the Applicant attempted to send himself subsequent to his dismissal. These are:
(a) precedent documents used in the Respondent’s business;
(b) documents containing details of clients and their cases, some of which dated back to 2014; and
(c) a document used by the Respondent in its marketing titled “success stories - template marketing”.
[184] The Respondent described these documents as having value for the Respondent and that Mr Hans stole them.
[185] The Applicant’s case is that he was authorised by his supervisor, Mr Casey, to copy these documents subsequent to his dismissal on 12 October 2018.
[186] Mr Casey’s evidence was that he only authorised the copying or emailing of Mr Hans’ own precedents not of the firm’s documents.
[187] It is noted that the attempted copying and sending occurred after the Applicant’s termination. I am also aware that ultimately Mr Hans was not successful in forwarding the documents.
[188] I note that it is agreed that the Applicant enquired from Mr Casey whether he could copy certain documents and that Mr Casey permitted him to do so. What is not agreed is the nature of those documents that could be copied.
[189] It seems many of the documents sought to be copied were precedents from the Applicant’s former employer. For reasons detailed in relation to the Shorter allegations, the nature of the work of legal firms and the sharing of precedents has been described as a practice among practitioners in certain circumstances. There was disagreement about when those circumstances occur; however, it is not necessary to decide whether in these circumstances it was reasonable for the Applicant to copy or forward those particular documents to himself.
[190] One document however would seem to me to fall outside this general rule, and it should have been known as such to the Applicant. This is the “Success Stories” document. In my view, on the evidence, it plainly falls outside any precedent document and is commercial in nature. I also accept such a document would be of some value to a newly established law firm. It did not belong to the Applicant and more care should have been exercised in selecting it among the documents he attempted to forward to himself.
[191] It has been held that post-employment conduct can be taken into account when assessing remedy. 75
[192] In my view all the misconduct detailed above, during and post-employment, is relevant in determining any compensation and I would on that basis reduce the compensation payable to zero.
Misconduct reducing the compensation
[193] Section 392(3) of the FW Act provides as follows:
“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”.
[194] The Applicant’s refusal to relocate falls into this category. It is also apparent from the evidence that many of the management-related factors discussed above contributed to the Respondent’s decision to dismiss the Applicant, even if they did not constitute a valid reason on their own. I consider these matters are also relevant, but given the reduction of the compensation to zero, it is not necessary for me to quantify the impact of those other relevant matters.
Conclusion
[195] The termination of the Applicant was harsh unjust or unreasonable, and therefore unfair.
[196] Taking into account all the circumstances, no amount of compensation is ordered.
COMMISSIONER
<PR710496>
1 this was not corrected but it is clearly meant to be 2019.
2 Applicant’s Outline of Argument: Merits on Behalf of the Applicant, dated 19 December 2018, at [3].
3 Respondent’s Closing Submissions filed 23 March 2019, at [14].
4 Ibid.
5 Ibid at [14]-[15].
6 Respondent’s Outline of Argument: Merits, filed 17 January 2019, at question 1a.
7 Ibid at question 2b.
8 Respondent’s Closing Submissions, filed 23 March 2019, at [12].
9 Ibid at [7].
10 Ibid at [10].
11 Annexure A to Applicant’s Outline of Argument, dated 19 December 2018, at [3].
12 Annexure A to Applicant’s Outline of Argument, dated 19 December 2018, at [4]-[5].
13 Applicant’s Submissions in Reply, dated 5 April 2019, at [17].
14 Ibid at [18]-[19].
15 Ibid at [6].
16 Ibid.
17 Ibid at [27]; Mohazab v Dick Smith Electronics Pty Ltd (No 2) (1995) 62 IR 200, 205; O’Meara v Stanley Works Pty
Ltd (2006) 58 AILR 100, [19]-[23].
18 Applicant’s Submissions in Reply, dated 5 April 2019, at [36].
19 Applicant’s Submissions in Reply, dated 5 April 2019, at [49].
20 Sayer v Melsteel Pty Ltd [2011] FWAFB 7498, [14]; Smith and others v Moore Paragon Australia Ltd, [2002] AIRC 317, [69].
21 Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373.
22 Ibid.
23 Walton v Mermaid Dry Cleaners Pty Ltd (1996) 142 ALR 681, 685.
24 Respondent’s Closing Submissions, filed 23 March 2019, at [18].
25 Respondent’s Closing Submissions, filed 23 March 2019, at [22]- [39].
26 The Applicant’s former supervisor at Quinn and Scattini.
27 Respondent’s Submissions in Reply, dated 27 April 2019, at [2].
28 Ibid at [3].
29 Respondent’s Document 14, “Summary Termination” letter dated 16 October 2018.
30 Presumably referring to the email records on the computer program ‘Outlook’.
31 Respondent’s Closing Submissions, filed 23 March 2019, at [41].
32 Respondent’s Outline of Argument: Merits, filed 17 January 2019, at questions 3a. and 3b.
33 Respondent’s Closing Submissions, filed 23 March 2019, at [22].
34 Respondent’s Outline of Argument: Merits, filed 17 January 2019, at question 4a.
35 Ibid at question 4b.
36 MM Cables (A Division of Metal Manufacturers Limited) v Zammit Print S8106 (AIRCFB, Ross VP, Drake SDP, Lawson C, 17 July 2000).
37 Shepherd v Felt Textiles Australian Ltd [1931] HCA 21.
38 PN516.
39 As to whether an employer can unilaterally withdraw notice of termination see Birrell v Australian National Airlines Commission [1984] FCA 378, cited by Bupa Aged Care Australia Pty Ltd t/a Bupa Aged Care Mosman v Shahin Tavassoli [2017] FWCFB 3941 [16]: “a unilateral withdrawal of a notice of termination of a contract of employment is not possible”.
40 Lane v Arrowcrest (1990) 27 FCR 427, 456; cited with approval in Byrne v Australian Airlines Ltd [1995] HCA 24 (11 October 1995) at paras 131, 136 (McHugh and Gummow JJ), [(1995) 185 CLR 410 at pp. 467, 468].
41 Tenix Defence Pty Ltd v Galea PR928494.
42 Respondent’s Closing Submissions, filed 23 March 2019, at [19].
43 PN482.
44 O'Connell v Wesfarmers Kleenheat Gas Pty Ltd t/a Kleenheat Gas[2015] FWCFB 8205, at [33].
45 Ibid at [34].
46 Respondent’s Closing Submissions, filed 23 March 2019, at [24].
47 (1893) 6 R. 67, H.L. See Singh v Dhaliwalz Pty Ltd [2013] WAIRComm 133 as to the applicability of the rule to unfair dismissal actions in the context of Western Australian law.
48 Annetta v Ansett Australia Ltd S6824 at [10].
49 Briginshaw v Briginshaw [1938] HCA 34; 60 CLR 336, 361-362.
50 Compare Walker v Salvation Army [2017] FWC 32 at [39].
51 PN1128.
52 PN1137.
53 PN487.
54 Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, 151.
55 Previsic v Australian Quarantine Inspection Services Print Q3730.
56 Ibid.
57 (2000) 98 IR 137.
58 Ibid at [73].
59 Applicant’s Submissions in Reply, dated 5 April 2019, at [10].
60 PN172.
61 PN174.
62 PN181.
63 As noted above, the Applicant had served the minimum period of employment under the Act and so the purported probation period is not relevant.
64 Respondent’s Closing Submissions, filed 23 March 2019, at [30].
65 Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, at [75].
66 Compare Fair Work Regulation at regulation 1.07(2)(a).
67 Respondent’s Closing Submissions, filed 23 March 2019, at [22].
68 ALH Group Pty Ltd trading as the Royal Exchange Hotel v Mulhall (2002) 117 IR 357, at [51]. See also Smith and others v Moore Paragon Australia Ltd [2002] AIRC 317, at [92]; Edwards v Justice Giudice [1999] FCA 1836, at [6]–[7].
69 Kehagias v Unilever Australia Limited Print Q0498 (AIRCFB, Watson SDP, Williams SDP, Larkin C, 29 April 1998).
70 Nguyen and Le v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter [2014] FWCFB 7198, at [9].
71 He v Lewin [2004] FCAFC 161, at [58].
72 Biviano v Suji Kim Collection PR915963 (AIRC, Full Bench, 28 March 2002), at [34] citing Lockwood Security Products Pty Limited v Sulocki and Ors PR908053 (AIRC, Full Bench, 23 August 2001), at [45].
73 Biviano v Suji Kim Collection PR915963 (AIRC, Full Bench, 28 March 2002), at [34] citing Payzu Ltd v Saunders [1919] 2 KB 581.
74 J Le Good v Stork Electrical Pty Ltd 747/99 M Print R6813 [1999] AIRC 291, at [41]-[42].
75 Tenix Defence Pty Ltd v Galea PR928494 AIRCFB 11 March 2003.
Printed by authority of the Commonwealth Government Printer