DECISION

Fair Work Act 2009
s.604—Appeal of decision

Compuworld Pty Ltd
v
On Ni Liu
(C2020/4575)

Appeal against decision [2020] FWC 2569 of Deputy President Asbury at Brisbane on 22 May 2020 in matter number C2019/2083.

Introduction and background

[1] Compuworld Pty Ltd (Compuworld) has lodged a notice of appeal, for which permission to appeal is required, against a decision of Deputy President Asbury issued on 22 May 2020 (decision). 1 The decision concerned the consent arbitration, pursuant to s 369 of the Fair Work Act 2009 (FW Act) of a general protections dismissal application brought by Ms On Ni Liu, a former employee of Compuworld. In the decision, the Deputy President determined that Compuworld had contravened ss 340 and 351 of the FW Act by dismissing Ms Liu for reasons which included prohibited reasons, and awarded compensation totalling $52,094.60.

[2] This appeal was heard on 23 July 2020 by a Full Bench consisting of Vice President Hatcher, Deputy President Kovacic and Deputy President Cross. At the conclusion of the hearing, the bench reserved its decision. Sadly, on 31 July 2020, Deputy President Kovacic passed away. On 12 August 2020, the President of the Commission, Ross J, reconstituted the bench to consist of Vice President Hatcher, Deputy President Dean and Deputy President Cross. The parties were informed of this the same day, and advised that Deputy President Dean would read the transcript of the hearing and the submissions and other materials filed by the parties, and would join in the decision-making process of the reconstituted Full Bench on that basis. The parties were given an opportunity to object to this course, but no communication of any objection was received, and accordingly the matter has been determined on the basis described.

[3] The background to this matter is as follows. Compuworld is a family run business involved in sales of business equipment, mainly desktop and notebook computers, to registered businesses. Compuworld had employed Ms Liu in September 2008 in the position of Receptionist/Accounts on a full time basis.

[4] On 30 November 2018, Ms Liu was given a letter terminating her employment by reason of redundancy. The letter noted a review of Compuworld’s operational requirements due to a downturn in sales. The letter also referred to the possibility of a casual position being offered to the Ms Liu, however she did not take up that offer of a casual position.

[5] Ms Liu alleged that adverse action was taken against her when she was dismissed from her employment, in contravention of the general protections provisions in Part 3-1 of the FW Act. In particular, Ms Liu alleged that Compuworld took adverse action against her within the meaning in s. 342(1)(a) by dismissing her from employment:

(a) because she had exercised one or more workplace rights; and/or

(b) because of her pregnancy or physical disability (gestational diabetes).

In the alternative, Ms Liu claimed that the Respondent took adverse action against her by threatening to alter her position to her prejudice by dismissing her from a full-time position and offering her casual employment.

[6] At the time of Ms Liu’s dismissal she was pregnant and suffering from gestational diabetes. Prior to her dismissal, Ms Liu had raised issues in relation to her entitlement to take sick leave to attend pre-arranged medical appointments relating to her pregnancy and her gestational diabetes. Ms Liu asserted, and the Deputy President accepted, that the Directors and Managers of Compuworld knew that she was pregnant and that she intended to take maternity leave. Ms Liu had also raised previous issues concerning her leave and award entitlements.

[7] Ms Liu filed an application pursuant to s 365 of the FW Act for the Commission to deal with a dismissal dispute involving a contravention of Part 3-1 of the FW Act. The application was the subject of a conciliation but did not settle, and the Commission thereafter issued a certificate pursuant to s 368(3)(a) of the FW Act to the effect that it was satisfied that all reasonable attempts to resolve the dispute, other than by arbitration, had been or were likely to be unsuccessful. The parties subsequently consented to the Commission determining the dispute by arbitration pursuant to s 369(1). The matter was then heard by the Deputy President.

The decision

[8] In the decision, the Deputy President found that at the time Ms Liu’s employment ended, she had workplace rights which she had exercised or proposed to exercise, being the right to paid personal leave 2, and the right to make an oral and written application for maternity leave3. The Deputy President also found that Ms Liu had sought to exercise those rights for the purposes of attending pre-arranged medical appointments with respect to treatment for pregnancy-related gestational diabetes4, and by informing Mr Kevin Chen on 30 November 2018, that she wanted to take maternity leave from the end of February or early March 20195.

[9] The Deputy President found that adverse action was taken by Compuworld against Ms Liu, as defined by s 342(1) of the FW Act, by her dismissal. That conclusion was not affected by the possibility of a casual position being offered to Ms Liu, and the Deputy President found that no such offer was made 6.

[10] Regarding the reason for the adverse action, the Deputy President was satisfied that Ms Liu proved the existence of objective facts of the basis of the Compuworld’s conduct and the elements of each of the general protections on which she relied 7. Accordingly, pursuant to s 361, the onus shifted to Compuworld to prove that it did not take adverse action against Ms Liu for the reasons that she alleged. The Deputy President concluded:

“[178] On balance, the Respondent has not discharged the onus of establishing that the reasons for the termination of the Applicant’s full-time employment did not include reasons which contravene the provisions in Part 3 – 1 of the Act. I have concluded that the reasons for the adverse action taken against the Applicant included the following prohibited reasons:

•  the exercise by the Applicant of a workplace right to take personal leave for the purposes of attending medical appointments in relation to gestational diabetes; and

•  the Applicant’s pregnancy; and

•  the disability suffered by the Applicant as a result of the pregnancy – namely gestational diabetes.

[179] Although I accept that the economic situation of the Respondent was also a reason for the termination of the Applicant’s full-time employment, I have also concluded that the prohibited reasons were substantial or operative factors influencing the adverse action.”

[11] Ms Liu did not seek reinstatement, but rather sought compensation for economic and non-economic loss pursuant to s 369(2)(b) and (c). 8 In her consideration of the remedy of compensation, the Deputy President observed:

“[181] The approach to assessing compensation under s. 369(2) of the Act has been drawn from cases involving s. 545(2)(b) which concerns orders that particular courts may make for contraventions of civil penalty provisions under the Act, including ss. 340 and 351. Section 545(2)(b) provides that the Federal Court or Federal Circuit Court may make orders for loss that a person has suffered because of a contravention. In Heraud v Roy Morgan Research Ltd (No 2)  Judge Jones summarised cases in relation to compensation under s. 545(2)(b). Notwithstanding that Courts are dealing with damages, the principles are apposite when compensation under s 369(2) is being determined. The principles which can be distilled from those case are:

•  Compensation is for loss suffered because of the contravention and there must be an appropriate causal connection between the contravention and the loss claimed.

•  In assessing compensation the court will:

•  have regard to what is reasonable in the circumstances and what would have been likely to occur if had the Act not been contravened; and

•  consider the detriment to the employee occasioned by the employer’s contravention and the extent to which it is reasonable to compensate the employee for such consequence.

•  The approach to calculation of compensation is, so far as a monetary amount can achieve, to place the employee in the position he or she would have been in had the employer not contravened the Act, having regard to:

•  the totality of the evidence;

•  how long the employee would have remained in employment and the determination of the value of the likely income stream.

•  The value of the likely income stream is discounted for reduced by the discount for contingencies and vicissitudes and the employee’s mitigated loss.

•  The Court may consider whether the employee has taken appropriate steps to mitigate his or her loss, however it is for the employer to establish the facts going to the employee’s alleged failure in this regard.

•  Assessment for economic compensation for loss suffered because of a contravention of the Act is not limited to the loss of a particular job and may extend to circumstances where the employee has suffered a loss of opportunity for employment because of a particular contravention.” (Footnotes omitted)

[12] The Deputy President noted that Ms Liu sought economic and non-economic loss in the amount of $96,092.60 comprising the following amounts: 9

	$	$
4 weeks in lieu of notice	3349.60
LSL and rec leave underpayment	3089.82	6439.42
Lost earnings		6699.20
Lost Centrelink maternity leave		13,330.80
Future earnings		44,850.00
Super contributions – past	636.42
Super contributions – future	4136.76	4773.18
Non-economic loss		20,000.00
Total		96,092.60

[13] Regarding the length of time Ms Liu would have remained in employment, the Deputy President found that:

(a) had Compuworld not contravened the general protections provisions in Part 3 -1 of the FW Act by terminating Ms Liu’s full-time employment, Ms Liu would have remained in employment until at least 4 March 2019, when she would have proceeded on unpaid parental leave and continued her employment 10; and

(b) Ms Liu’s employment would have continued for a further period of no more than six months after her return from parental leave, being half of the 12 month period claimed by Ms Liu 11.

[14] In assessing past economic loss, the Deputy President determined that compensation for past economic loss would relate to two components, being:

(a) payment for the period from Ms Liu’s return to work on 7 January 2019, to 4 March 2019, when she would have commenced maternity leave in the amount of eight weeks’ wages at $721.00 per week, totalling $5,768.00 12; and

(b) loss of access to the Commonwealth Government paid maternity leave scheme, pursuant to which Ms Liu would have received a payment of 18 weeks at the amount of $740.60 per week before tax, totalling $13,330.80 13.

[15] In assessing future economic loss, the Deputy President determined that Ms Liu would have remained in employment for only a further period of six months. In that six-month period the Ms Liu would have earned an amount of $18,746 gross, however a deduction of 15% for contingencies was determined by the Deputy President to be appropriate. Applying that 15% deduction for contingencies, the amount for future economic loss was determined to be $15,934.10 14.

[16] As to non-economic loss, the Deputy President found:

“[215] Unlike the circumstances in Heraud (No 2) there is evidence from the Applicant’s treating psychiatrist that establishes that these matters contributed to the post-natal depression suffered by the Applicant. Although the evidence also establishes that there were other more significant factors at play, it also establishes that the Respondent’s contraventions contributed to the Applicant’s condition and caused her distress. In all of the circumstances I consider it appropriate to award an amount of $15,000 for non-economic loss.”

Appeal grounds

[17] There were four appeal grounds stated in the notice of appeal. They were:

(1) the basis of the $15,000.00 awarded for non-economic loss was unjust;

(2) it was unjust to apportion full responsibility for the loss of income from the Commonwealth Government paid maternity leave scheme to Compuworld;

(3) the finding of discrimination was unjust, and disregarded the decline in business activity and the fact that two other employees were also made redundant; and

(4) the hearing before the Deputy President was favoured towards Ms Liu as she had legal representation and Compuworld did not.

[18] The notice of appeal contended that the grant of permission to appeal would be in the public interest because:

(1) it is important to allow small business the right to make business decisions to ensure their survival, and it should not be deemed discriminatory where a decision is purely business related and made in the interest of business survival;

(2) it is necessary to ensure businesses can make decisions purely on the merits of the requirements of that business, without fear of reprisal which could lead to discrimination against other employees; and

(3) it is in the public interest to ensure a precedent where a just percentage is awarded for non-economic loss.

Consideration

Permission to Appeal

[19] The appeal before us is brought pursuant to s 604 of the FW Act. An appeal under s 604 is an appeal by way of rehearing, and the Commission’s powers on appeal are only exercisable if there is error on the part of the primary decision maker 15. There is no right to appeal and an appeal may only be made with the permission of the Commission. Section 604(2) requires that permission to appeal be granted if the Commission is satisfied that it is in the public interest to do so.

[20] In addition, because the compensation decision was made pursuant to s 369 of the FW Act, s 375A applies to these appeals. Section 375A provides:

375A Appeal rights

(1) Despite subsection 604(2), the FWC must not grant permission to appeal from a decision made by the FWC under subsection 369(2) (which is about arbitration of a dismissal dispute) unless the FWC considers that it is in the public interest to do so.

(2) Despite subsection 604(1), an appeal from a decision made by the FWC in relation to a matter arising under subsection 369(2) can only, to the extent that it is an appeal on a question of fact, be made on the ground that the decision involved a significant error of fact.

[21] Section 375A is expressed in terms relevantly identical to s 400, which applies to appeals from decisions made pursuant to Pt 3-2 of the FW Act. We consider that decisions made concerning the proper interpretation and application of s 400 are relevant for that reason. In the Federal Court Full Court decision in Coal & Allied Mining Services Pty Ltd v Lawler and others 16, Buchanan J (with whom Marshall and Cowdroy JJ agreed) characterised the test under s 400 as “a stringent one”. The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment17. A Full Bench of the Commission, in GlaxoSmithKline Australia Pty Ltd v Makin, identified some of the considerations that may attract the public interest:

“… the public interest might be attracted where a matter raises issues of importance and general application, or where there is a diversity of decisions at first instance so that guidance from an appellate court is required, or where the decision at first instance manifests an injustice, or the result is counter intuitive, or that the legal principles applied appear disharmonious when compared with other recent decisions dealing with similar matters…” 18

[22] It will rarely be appropriate to grant permission to appeal unless an arguable case of appealable error is demonstrated. This is so because an appeal cannot succeed in the absence of appealable error 19. However, the fact that the Member at first instance made an error is not necessarily a sufficient basis for the grant of permission to appeal.20

[23] We do not consider, for the reasons that follow, that it would be in the public interest to grant permission to appeal in respect of any of the grounds of appeal.

First ground of appeal

[24] As to the first ground of appeal, Compuworld submitted that the basis of the determination of an amount of $15,000 for non-economic loss was manifestly unjust, particularly where Ms Liu had sought an amount of $20,000. This unjustness was submitted to be all the more so because the Deputy President had acknowledged that there were other “more significant factors at play”. 21 Compuworld submitted that it was unjust to award the amount of $15,000 given the Deputy President’s finding that “other more significant” factors were the reason for the respondent’s post-natal depression.

[25] Compuwould noted that the Deputy President, in determining the compensation amount for non-economic loss, had referenced three cases awarding compensation amounts of $5000, $10,000 and $20,000 respectively. The Deputy President had, it was submitted, erroneously accorded weight to the case of Heraud v Roy Morgan Research Ltd (No 2) (Heraud (No 2)) 22 which awarded $20,000 to the applicant when there are substantial differences between the cases. It was put that in Heraud (No 2), the employee adversely affected had no other contributing or questionable cause for her emotional distress as in the present case. If the Deputy President considered the other events to have contributed to the emotional distress, then the amount of compensation should have logically been at least less than half that awarded in of Heraud (No 2).

[26] Compuworld has selectively quoted the Deputy President. At paragraph [215] of the decision, which we have earlier set out, the Deputy President expressly found that Compuworld’s contraventions contributed to Ms Liu’s condition and distress, while acknowledging that there were other causal factors involved. Far from being unjust, counter intuitive or disharmonious, the Deputy President’s award regarding non-economic loss identified different circumstances in Heraud (No 2), and identified the evidence from Ms Liu’s treating psychiatrist as establishing that Compuworld’s contraventions contributed to Ms Liu’s condition and caused her distress. The amount awarded was not in any way disharmonious with the authorities referred to, or authorities relating to the assessment of non-economic loss generally.

Second ground of appeal

[27] By the hearing of the appeal, this ground had reduced to an assertion by Compuworld that the Newborn Upfront Payment and Newborn Supplement should have been deducted from the Paid Maternity Leave that was the basis of the award of compensation of $13,330.80 for lost Commonwealth Government paid maternity leave. That was not how the notice of appeal had alleged error in relation to Commonwealth Government paid maternity leave.

[28] This issue was not addressed before the Deputy President, and it is unknown what payments Ms Liu did or did not receive. It is advanced on the mere supposition of Compuworld. In the absence of any such evidence it is not possible to allege, let alone establish, any error.

Third ground of appeal

[29] In relation to the third ground of appeal, and the allegation that the finding of discrimination was unjust, and disregarded both the decline in Compuworld’s business activity and that two other employees were also made redundant, we do not consider that the evidence and the decision provide any support for that submission.

[30] Regarding the decline in Compuworld’s business activity, it was specifically accepted by the Deputy President that this was a reason, operating together with other proscribed reasons, for Ms Liu’s termination. The Deputy President found:

“[179] Although I accept that the economic situation of the Respondent was also a reason for the termination of the Applicant’s full-time employment, I have also concluded that the prohibited reasons were substantial or operative factors influencing the adverse action.”

[31] Similarly, the submission that two other employees were also made redundant at the time of Ms Liu’s dismissal was considered but rejected, for grounds that included the credibility of Compuworld’s witnesses. The Deputy President found:

“[168] It is also the case that the timing of the Applicant’s dismissal is at odds with the Respondent’s evidence about two other employees who were also dismissed, purportedly for the same reasons as the Applicant. Ms Chiang’s evidence is that the meeting where the financial position of the Company was discussed was held some time in October 2018. The Respondent’s case is that it was this meeting which informed the view that reduction in employee numbers was required. Putting aside the conflict in the evidence about whether one or other of the two employees – Keith and Jack – left of their own volition or were dismissed, on Mr Michael Chen’s evidence, one employee left on 12 October 2018 and the other on 9 November 2018. The fact that the Applicant was not dismissed until 30 November 2018 is at odds with the evidence that the Respondent was in such a dire situation following the meeting in October 2018 that it also needed to dismiss the Applicant at the time that it did

[169] Mr Kevin Chen’s evidence about why he waited until 30 November 2018 to dismiss the Applicant was not convincing. Effectively, Mr Kevin Chen said that he did not dismiss the Applicant before 30 November 2018 because he was busy doing other things. This is inconsistent with the picture of the dire financial situation the Respondent sought to paint. Further, the manner in which the Applicant’s dismissal was effected is at odds with the manner in which the two employees who were also purportedly dismissed due to the financial position of the Respondent were dealt with. Mr Michael Chen’s evidence is that those employees were informed about the Company’s position and why they were being dismissed. This is in stark contrast with the manner in which the Applicant was dealt with.”

[32] We note that there was no challenge in the appeal to the credibility findings made by the Deputy President. Those credibility findings were fundamental to the Deputy President’s rejection of Compuworld’s case.

Fourth ground of appeal

[33] In relation to the fourth ground of appeal, we do not consider that it is reasonably arguable that the hearing before the Deputy President was “favoured” towards Ms Liu merely because she had legal representation and Compuworld did not. Compuworld made no material submissions, either written or oral, in relation to this ground, and it did not direct the Commission’s attention to any instances of “favour” towards Ms Liu. In the absence of such submissions or particularisation, including any identifiable contention that the Deputy President’s grant of permission for legal representation under s 596(2)(a) and (b) of the FW Act was the subject of appealable error, the fourth ground of appeal cannot usefully be the subject of appellate consideration.

Conclusion

[34] We are not persuaded that there is an arguable case that the decision of the Deputy President was tainted by legal or factual error, or that the Deputy President’s discretion miscarried. The matter before the Deputy President turned on its own facts, and the appeal does not raise any genuine question of law or any issue of importance or general application. We are not satisfied that it is in the public interest to grant permission to appeal. Accordingly, permission to appeal must be refused in accordance with s 375A(1).

VICE PRESIDENT

Appearances:

Mr K Chen accompanied by Mr M Chen on behalf of the appellant
Ms F Keyes on behalf of the respondent.

Hearing details:

2020.
Sydney (video-link)

23 July.

Final written submissions:

Printed by authority of the Commonwealth Government Printer

<PR721786>

 1   [2020] FWC 2569

 2   Ibid at [142]

 3   Ibid at [146]

 4   Ibid at [143]

 5   Ibid at [37] and [146]

 6   Ibid at [153].

 7   Ibid at [163].

 8   Ibid at [186].

 9   Ibid at [186].

 10   Ibid at [194].

 11   Ibid at [211].

 12   Ibid at [202] and [203].

 13   Ibid at [206].

 14   Ibid at [211].

 15   This is so because on appeal the Commission has power to receive further evidence, pursuant to s.607(2); see Coal and Allied v AIRC [2000] HCA 47, 203 CLR 194 at [17] per Gleeson CJ, Gaudron and Hayne JJ.

 16   [2011] FCAFC 54, 192 FCR 78, 207 IR 177 at [43]

 17   O’Sullivan v Farrer [1989] HCA 61, 168 CLR 210 per Mason CJ, Brennan, Dawson and Gaudron JJ; applied in Hogan v Hinch [2011] HCA 4, 243 CLR 506 at [69] per Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ; Coal & Allied Mining Services Pty Ltd v Lawler and others [2011] FCAFC 54, 192 FCR 78, 207 IR 177 at [44]-[46]

 18   [2010] FWAFB 5343, 197 IR 266 at [27]

 19   Wan v AIRC [2001] FCA 1803, 116 FCR 481 at [30].

 20   Lawrence v Coal & Allied Mining Services Pty Ltd t/as Mt Thorley Operations/Warkworth [2010] FWAFB 10089, 202 IR 388 at [28], affirmed on judicial review in Coal & Allied Mining Services Pty Ltd v Lawler [2011] FCAFC 54, 192 FCR 78, 207 IR 177; NSW Bar Association v Brett McAuliffe; Commonwealth of Australia represented by the Australian Taxation Office [2014] FWCFB 1663, 241 IR 177 at [28].

 21   [2020] FWC 2569 at [215].

 22   [2016] FCCA 1797.