DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Maria Ranchod
v
Dog and Bone Holdings Pty Ltd T/A Dog & Bone
(U2021/2587)

Application for an unfair dismissal remedy – Objection on the ground of genuine redundancy – Genuine redundancy under the Fair Work Act 2009 – Evidentiary onus to establish objection – Respondent’s failure to establish objection – Consideration of whether dismissal unfair – Finding that dismissal was unfair – Reinstatement not appropriate – compensation awarded.

Overview

[1] Ms Maria Ranchod (the Applicant) applies under s. 394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy in respect of her dismissal by Dog and Bone Holdings Pty Ltd T/A Dog & Bone (the Respondent). The Applicant and the CEO and Director of the Respondent, Mr Lee Ranchod, are married. In November 2020 they separated but continued to reside together and at the time the application was made were in the process of dissolving their marriage. Understandably there is acrimony associated with the dissolution of the marriage and related litigation, which impacted the hearing of this application.

[2] The Respondent is engaged in the technology industry and develops and sells products such as phone cases and smart locks. The Applicant states that she co-founded the Company and commenced working for the Respondent on 1 January 2012. The Applicant was employed by the Respondent as Marketing Director and contends that she brought skills to the Company developed in her studies for a Business Communications degree majoring in Marketing and PR, and twenty years’ experience working in a senior capacity for various companies. The Respondent disputes that Applicant co-founded the Company in 2012 and maintains that her employment only started in July 2016. It is common ground that the Applicant was notified of her dismissal on 2 March 2021 and that the dismissal took effect on 23 March.

[3] The Applicant contends that her dismissal was not a case of genuine redundancy and was a ruse to remove her from the Company because of the breakdown of her marriage to Mr Ranchod. The Respondent objected to the application on the basis that it asserted that the dismissal was a case of genuine redundancy and in the alternative, on the ground that the dismissal was consistent with the Small Business Fair Dismissal Code (the Code).

[4] The Respondent did not agree to participate in a conciliation conference before the jurisdictional objection was determined and the matter was subsequently allocated to me for hearing and determination. At a Mention/Directions hearing on 4 May 2021, the Respondent withdrew its objection to the application based on the Code and maintained its objection based on the contention that the dismissal was a case of genuine redundancy. The parties agreed that the hearing would determine the jurisdictional objection and merits.

Procedural matters

[5] Directions were issued for the filing of material in relation to:

•  Whether the dismissal was a case of genuine redundancy (the jurisdictional objection); and

•  In the event the jurisdictional objection is not upheld, whether the dismissal was unfair on the basis that it was harsh, unjust or unreasonable (merits); and

•  If the dismissal was unfair, the remedy, if any, that should be granted.

[6] The Directions required that the Respondent file evidence and submissions in relation to its jurisdictional objection (genuine redundancy), and at the same time, the Applicant file evidence and submissions in relation to merit (whether her dismissal was unfair). The Directions then provided for each party to respond to the material filed by the other party. The requirements set out in the Directions were explained to the parties at the Mention/Directions hearing. All relevant legislative provisions were appended to the Directions and they included links to template documents to assist in the preparation of outlines of submissions and witness statements. The Directions also dealt with requirements for tendering documents by appending them to a witness statement.

[7] In support of her assertions about the real reasons for her dismissal, the Applicant referred in her material to documents, including a Family Report prepared by a family counsellor, and quoted sections of those documents without attaching them to a witness statement. It became apparent that the Family Report was prepared for the purposes of family law proceedings and other than an assertion from the bar table by the Applicant, there was no evidence that the author of the Report had been informed that it was to be tendered to the Commission or that permission from the Court had been sought. It was also apparent that the Applicant was seeking to rely on the Report to establish that Mr Ranchod had made certain statements to the author of the Report and that she did not intend to call the author of the Report to give evidence. Mr Ranchod denied making the statements recorded in the Report and contended that he had sought advice from his legal representatives during an adjournment granted to the parties for this purpose, who advised that he should object to the Report being tendered. In those circumstances, I did not allow the Applicant to tender the Report. Other witness statements filed by the Applicant contained some hearsay and irrelevant material but were admitted without the persons who made the statements being required for cross-examination. I have considered the evidence of those witnesses where relevant.

[8] The evidence filed on behalf of the Respondent was also unhelpful and consisted of a series of assertions without proper supporting documentary evidence. Notwithstanding the detailed Directions issued in this matter, the Respondent through Mr Ranchod, generally failed to file material that was responsive to the Directions and the material that was filed did not deal properly with the matters necessary to make out the Respondent’s jurisdictional objection. The Respondent filed one tranche of material and did not file a response to the Applicant’s material. Further, the outline of submissions filed by the Respondent stated that: there were no changes to the operational requirements of the Respondent’s business; answered “No” to a question as to whether the Respondent no longer required the employee’s job to be done by anyone because of changes to the operational requirements of the business; and stated that the Respondent had not considered the possibility of moving the Applicant into another position.

[9] The Applicant represented herself at the hearing and gave evidence on her own behalf.¹ Witness statements in support of the Applicant’s case were provided by her father Mr Emmanuel Castrisos² and her friend Ms Leona Cooke³. Mr Castrisos and Ms Cooke were not required for cross-examination and their statements were tendered without objection. As previously noted, the statements contained hearsay and some material that was not relevant to the matters in dispute to which I have attached little weight. Mr Ranchod gave evidence for the Respondent⁴ and also represented the Respondent at the hearing.

[10] Despite Mr Ranchod’s failure to file material in response to that of the Applicant, or to provide cogent and probative evidence about the Respondent’s financial position, he was allowed to give oral evidence and I questioned him to attempt to elicit evidence in response to that of the Applicant. Mr Ranchod was also permitted to file evidence to establish his assertions about the Respondent’s financial incapacity after the hearing concluded and the Applicant was permitted to respond. Both the Applicant and Mr Ranchod exceeded the grant of leave to file additional material about financial capacity and proceeded to engage in tit for tat email exchanges wherein each questioned the veracity of the other. The further material filed by the Respondent was also problematic and did not establish to the required standard, the assertions that were being made about its financial position nor respond to those made by the Applicant. This is also a matter to which I will return.

[11] Section 396 of the Act requires that four specified matters must be decided before the merits of the application may be considered:

(a) the application was made within the period required by s.394(2);

(b) the Applicant was a person protected from unfair dismissal;

(c) the Respondent was not a “small business employer” as defined in s.23 of the FW Act; and

(d) the dismissal was not a case of genuine redundancy.

[12] It is not in dispute that the application was made within the period required by s.394(2) of the Act or that the Applicant was a person protected from unfair dismissal. As previously noted, the Respondent withdrew its objection to the application on the ground that it was consistent with the Code and pressed its objection on the ground that the dismissal was a case of genuine redundancy.

[13] Consistent with s. 397 of the Act, I decided to conduct a hearing to determine the matter on the basis that there were disputed issues of fact and I considered this to be the most appropriate means to resolve them. The hearing was held in Brisbane on 26 May 2021. As previously noted, the parties continued to send unsolicited correspondence to the Commission making various unsubstantiated assertions up until 27 August 2021.

“Genuine Redundancy” under the FW Act

[14] If a dismissal is “a case of genuine redundancy” as defined in s. 389 of the FW Act, the employer has a complete defence to an unfair dismissal application⁵ and the Commission has no jurisdiction to deal with the question of whether the dismissal was unfair. Section 389 provides as follows:

“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.”

[15] An employer seeking to rely on the genuine redundancy exclusion would ordinarily be expected to adduce evidence as to the following matters:

•  That the employer no longer required the dismissed employee’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise;

•  Whether there was any obligation in an applicable modern award or enterprise agreement to consult about the redundancy and whether the employer complied with that obligation; and

•  Whether there was a job or position or other work within the employer’s enterprise (or that of an associated entity) to which it would have been reasonable in all of the circumstances to redeploy the dismissed employee. ⁶

[16] These matters are generally within the knowledge of the employer seeking to establish the exclusion. Where an employee leads evidence that the dismissal is not a case of genuine redundancy, the employer’s evidence needs to be sufficient to rebut any evidence from the dismissed employee to the contrary.

[17] To determine whether the duties performed by a person in a particular role or position are no longer required to be performed by anyone because of changes in the employer’s operational requirements, it is necessary to draw a distinction between the employee’s job and the employee’s duties.⁷ A dismissal may be a redundancy within the meaning in s. 389(1)(a) of the Act in circumstances including where:

•  the duties remain and operational changes result in fewer employees being required to perform those duties;⁸

•  all or some aspects of an employee’s duties are performed by someone else as a result of operational change;⁹ or

•  structural change has eliminated the need for specific duties or the employer has found another way to have those duties performed;¹⁰

[18] From the perspective of the dismissed employee, the important distinction between a job and the duties that comprise the job is often lost in circumstances where the duties of the dismissed employee are being done by others who remain in employment or are being done in a different way. While the terminology used in the legislation has a long history and a settled meaning, it is apt confuse, particularly in the case of self-represented parties in unfair dismissal matters.

[19] A dismissal for cause is not a redundancy. Where there is no change in operational requirements due to restructuring, reorganisation, change to a role, change to the composition of a workforce or a reduction in employees, and a dismissed employee can show that he or she was simply exited from the business and replaced with another person performing the same or substantially the same duties, a dismissal may not meet the definition in s. 389(1)(a).

[20] If an employee whose position is said to be redundant is not covered by a modern award or enterprise agreement, then there are no consultation obligations for the purposes of s. 389(1)(b) of the Act and it is not necessary for the employer to establish that the employee was consulted about the redundancy to establish the genuine redundancy defence to an unfair dismissal application.

[21] In relation to redeployment, s. 389(2) of the Act provides an exception to the circumstances in which a person’s dismissal will be a case of genuine redundancy within the meaning in s. 389(1) of the Act if it would have been reasonable in all the circumstances for the person to be redeployed.¹¹ If s. 389(2)(a) is enlivened, a person’s dismissal will not be a case of genuine redundancy even if the person’s employer no longer requires the job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise and any relevant consultation obligations have been met.

[22] As a Full Bench of the Commission noted in Appeal by Technical and Further Education Commission T/A TAFE NSW¹² (Pykett) the circumstances that enliven the exception are that: “it would have been reasonable in all the circumstances for the person to be redeployed within… the employer’s enterprise.”¹³ The use of the past tense in s. 389(2) directs attention to the circumstances which pertained at the time the person was dismissed. The Full Bench in that case also held that the term “redeployed” should be given its ordinary meaning, including “transfer to another job, task or function.”¹⁴

[23] The Full Bench in Pykett also held that it is not necessary that the Commission identify a particular job or position to which the dismissed employee could have been redeployed. For the purposes of s. 389(2), the Commission must find, on the balance of probabilities, that there was a job or a position or other work within the employer’s enterprise (or that of an associated entity) to which it would have been reasonable in all the circumstances to redeploy the dismissed employee. There must also be an appropriate evidentiary basis for such a finding.¹⁵

[24] The job (or position, or work) to which it is said that an employee could have been redeployed, must be suitable, in the sense that the employee should have the skills and competence required to perform it to the required standard either immediately or with a reasonable period of retraining. Considerations such as the location of the job and the remuneration attached to it may also be relevant.¹⁶ The availability of a more junior role that the employee may have accepted to avoid dismissal on the ground of redundancy could provide a basis for a finding that a redundancy was not genuine or that a dismissal was harsh, unjust or unreasonable.¹⁷

[25] In short compass, to enliven s. 389(2) of the Act is not sufficient for the Commission to simply find that an employer failed to consider redeployment of the dismissed employee within its enterprise or the enterprise of an associated entity. It is also necessary for the Commission to be satisfied that there was a job, role, position or work that could have been performed by the dismissed employee and having made that finding to then determine that it would have been reasonable in the circumstances for the dismissed employee to be redeployed. It is not necessary that a specific job role or position is identified for the purpose of determining whether the person could have been redeployed. It is sufficient if there is work that the person could have done.

[26] Consideration of the question of whether redeployment was reasonable involves questions of suitability including the skills and competence of the employee, the training that would be required and factors associated with the job such as remuneration and location. It may also involve an assessment of whether the dismissed employee would have been willing to accept redeployment.

[27] The term “a case of genuine redundancy” has a particular meaning in the context of unfair dismissal provisions of the FW Act, which is essentially that the criteria in s. 389(1) have been met and that it would not have been reasonable in all the circumstances to redeploy the person as provided in s. 389(2).

[28] It is possible that an employer genuinely no longer requires the job of the dismissed employee to be done by anyone because of changes in its operational requirements, but that the Commission will find that the dismissal is not “a case of genuine redundancy” because the employer has not complied with an obligation in a relevant modern award or enterprise agreement to consult the employee or where the Commission finds that it would have been reasonable for the dismissed employee to have been redeployed within the employer’s enterprise or the enterprise of an associated entity. Confusingly, such a case may be a bona fide redundancy, notwithstanding that it does not meet the other requirements in s. 389(1)(b) or s. 389(2) and is therefore not “a case of genuine redundancy” for the purposes of the defence to an unfair dismissal application provided by that section.

[29] The result in such a case is that the employer does not have a complete defence to an unfair dismissal application and the Commission is required to consider whether the dismissal is unfair having regard to the matters s. 387 of the Act which are in the following terms:

(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.

[30] Matters in s. 387 relating to the conduct or capacity of the employee will generally not be relevant if the dismissal is because the employer genuinely no longer requires the job of the dismissed employee to be done by anyone resulting from changes in its operational requirements. If the employer seeks to raise conduct and capacity issues relating to the dismissal of an employee that the employer has unsuccessfully argued was a case of genuine redundancy, the requirements in ss. 387(b), (c) and (e) which broadly relate to procedural fairness may not have been met, because the reason for the dismissal at the time it was carried out is redundancy and not conduct or capacity.

[31] Failure to consult a dismissed employee as required by s. 389(1)(b) may not render a dismissal unfair when considered against the matters in s. 387. If the dismissal is a bona fide redundancy because of changes to the employer’s operational requirements and the job not being required to be done by anyone it may be found not to be unfair if consultation would not have negated the operational reasons for the dismissal or led to any other substantive change and the employee would have been dismissed in any event.¹⁸ Even if failure to consult in such cases renders a dismissal unfair, the remedy may be limited to compensation for a reasonable period for consultation to have occurred.¹⁹ Similar considerations may arise in circumstances where s. 389(2) of the Act is enlivened, however, consideration of whether a dismissal is unfair on the basis of failure to redeploy may involve a fine balance, because of the way the provision is framed and the matters that are required to be assessed.

Evidence and submissions

[32] The Applicant contends that she co-founded the business with Mr Ranchod in 2012 and has been employed by the Respondent since that time. Mr Ranchod claims that the Applicant was not employed by the Respondent until July 2016 and was in a marketing role from then until her role was made redundant.

[33] The Applicant has a Business Communications degree majoring in Marketing and PR, and twenty years business experience working in a senior capacity for various companies. She stated that Mr Ranchod is qualified as an Electrician and had very limited business experience through mobile accessory distribution, and no experience in launching a brand when they started their business. The Applicant stated that she supplied personal funds earned through her marketing career to kick-start their business ventures, and while she started the business jointly with Mr Ranchod, he “self-appointed himself” as CEO, and it was a mistake on her part to allow this to occur.

[34] The Applicant maintained that the value of the business is evidenced by more than $6.3 million of investor funding raised and said that a term sheet signed by Mr Ranchod in 2019 referenced a value of $16.5 million. The Applicant said that on 7 November 2020, after attending a rugby game, Mr Ranchod returned to their home and was overheard telling a friend that the business was worth more than ever and investors were pushing on a capital raising coupled with their other investment businesses to raise more capital. Mr Ranchod also told his friend that the Applicant was not aware of this information and would not be told.

[35] The Applicant stated that she undertook a variety of roles for the Respondent ranging from marketing, business planning and customer service, to product development and product testing. The Applicant also performed tasks relating to sales and packing orders and asserted that these roles and tasks remain within the operational needs of the business. The specific work undertaken by the Applicant, as listed in the Applicant’s witness statement, included: ²⁰

•  Business strategy and direction including preparing business plans, marketing strategy, new business documents, investor snapshots and presentations;

•  Managing all strategic and operational marketing and customer relationship activities;

•  Providing market feedback regarding competitive offerings, and comparative analysis on product development ideas;

•  Developing brand and product messaging;

•  Supporting and driving retailer and other partner promotions;

•  Concepting, copywriting and managing marketing materials whether that be for the website, product instruction manuals, packaging, brochures, promotional and demonstrational videos, point-of-sale and display materials, advertising – online/print, or detailed buyer information packs;

•  Preparing sales guides and other sales support materials;

•  Developing customer retention strategies;

•  Researching, concepting and planning trade show displays and activities;

•  SEO, SEM and social media;

•  Driving corporate and product publicity and promotions;

•  Strategising and planning new product launches; and

•  Evaluating and reporting on marketing activity and sales.

[36] The Applicant said that as the first employee of the Respondent, in addition to marketing functions, she has performed everything from product testing and development to customer service, sales and packing orders. The Applicant also said that Mr Ranchod had barely worked in the business or showed any concern about its financial status prior to her dismissal, and spent time excessively playing on his X Box during working time. The Applicant also said that Mr Ranchod informed her that the reason for her dismissal was due to their personal situation and that he did not wish to work with her any longer. In June 2020 the Applicant was informed by Mr Ranchod that she was fired, during a heated discussion during which the Applicant said that she questioned some concerning behaviours on the part of Mr Ranchod in relation to his internet searches on his work laptop.

[37] The Applicant also maintained that Mr Ranchod told a number of people, including the Applicant’s father, her friend Ms Cooke and the author of the Family Law Report referred to in the Applicant’s evidence, that he did not want to work with the Applicant and stated that he had been trying to get rid of her for years because of their personal situation. The Respondent moved offices in November 2020 and the Applicant was not provided with a key to the new office. The Applicant said that Mr Ranchod told her that she no longer needed a key. The Applicant also said that Mr Ranchod told her that they could not continue to work together after their split and asked the Applicant why she would want to work with him. In response the Applicant told Mr Ranchod that it was not his decision to make and that she would not be forced out. Further, the Applicant told Mr Ranchod that if he felt strongly about working with her then he should leave the business and that she was okay with continuing on together in the business on a professional basis.

[38] According to the Applicant, after their personal split, Mr Ranchod sent her a text message on 2 December 2020 stating: “… you want this to be war I will come after everything …. and I will spend every last cent on this. Mr Ranchod also advised in multiple conversations that he would hire other people via Upworks to do her job. The Applicant also gave evidence about Mr Ranchod stating to her in January 2021, that she was no longer needed and was fired, and would be replaced by his hockey friend Mr Zach Daunt. In January and February 2021, the Applicant attempted to comply with a request from Mr Ranchod to prepare a press release. The Applicant said that Mr Ranchod did not provide her with information she requested and that a meeting she attended with Mr Daunt was not attended by Mr Ranchod which meant that she could not seek information she had requested in relation to the reason for the meeting.

[39] On 21 January, Mr Ranchod sent an email to the Applicant stating that: “Zach is running our marketing drive and direction” even though this is what the Applicant was employed to do. The Applicant said that she was still employed and being paid JobKeeper at the time and there was no reason to cost the business money by employing someone else to do the job that she was qualified to do. The Applicant contended that the only logical reason for this was to lock her out of the business. The Applicant disputed Mr Ranchod’s evidence that there were no new products and said that there was a new product, being the keyless door lock and that she was in the process of doing the launch for that product. The company also has websites that are still active and need to be managed.²¹

[40] The Applicant said that she had worked in her role since 2012 compromising her corporate and career opportunities and taking a pay cut compared to her previous employment when she founded the business with Mr Ranchod. The Applicant contended that because of her personal relationship with Mr Ranchod breaking down, she has been robbed of her income, without a cent in redundancy payments and has not been paid her outstanding wages and leave entitlements, including the March 2021 JobKeeper payments collected by the Respondent on her behalf.

[41] In response to Mr Ranchod’s evidence about the financial position of the Respondent, the Applicant tendered financial statements from 2016 to 2020.²² These statements showed that the Company had made the following losses from ordinary activities before income tax:

•  2016 - $3,023,902.82;

•  2017 - $802.087.50;

•  2018 - $1,043,555.32;

•  2019 - $1,023,103.03;

•  2019 - $1,214,681.52; and

•  2020 - $1,001,245.95.

[42] Mr Ranchod accepted that the documents tendered by the Applicant were the Respondent’s financial statements.²³ No explanation was provided as to why there are two sets of figures for the year 2019. The documents also indicate that they should be read in conjunction with a compilation report which was not tendered by either party. The Applicant contended that the losses in previous years were more significant than the losses in the year she was made redundant and that this also evidenced that her redundancy was not based on financial considerations but rather, was a ruse to remove her from the business.

[43] In response to Mr Ranchod’s evidence about the financial issues confronting the Respondent, the Applicant said that in previous years the Respondent had made losses exceeding $1 million and that this is expected in a start-up business. Ms Ranchod also said that in the previous year the loss made by the Respondent was smaller and that there was a profit in one of the quarters identified by Mr Ranchod in his witness statement. According to the Applicant this meant that she should have remained in employment. In response to the investors’ position that they would not provide any more funds to the Respondent, the Applicant said that Mr Ranchod had boasted to his friends and made comments to various persons about the Respondent going to a public raising with other products and that the business was worth more than it had ever been.

[44] Under cross-examination, the Applicant was asked whether she could undertake certain tasks. The Applicant agreed that she had not previously installed locks in an apartment block but maintained that she could do this if shown how and that she had developed handbooks for the locks. The Applicant also said that Mr Ranchod had stated that anyone could install the locks. Further, the Applicant agreed that she did not know what chip the Respondent was using or what backend configuration the Respondent was running to support its network. In response to a question from me, the Applicant said that all of the technical work is done overseas but that when “Paul” came on board, he had undertaken this work. The Applicant also said that the door lock is a new product and that she lacked current knowledge about it due to having been locked out of the business by Mr Ranchod.

[45] The Applicant said that Paul did not have technical expertise and that before he was employed, the Applicant and Mr Ranchod did everything from packing orders to customer service and managing MYOB accounts. The Applicant also said that Paul had been performing poorly and that she had stepped in to test technical products. The Applicant maintained that there was nothing that Paul could do that she could not do although some instruction may be required. In response to a question from me about the fact that Paul is on a lower salary of $65,000.00 per annum and whether she would have been prepared to accept a salary reduction, the Applicant said that she would have to consider this and had not been given the option. Later, the Applicant said that if offered redeployment to a lower paid role, she would have likely accepted because she knows that this is not the real reason for her dismissal and as long as she could stay in the business she could make sure that it was given every success it deserved. The Applicant said that she could have undertaken the CFO role on the basis that she had previously done the finances and an external accountant had done the books. I asked the Applicant whether she could have continued to work with Mr Ranchod, and in relation to this had the following exchange with her:

“Okay, which brings me to my final question, and you can disagree or agree with it, okay. I haven't formed any view, but sitting here today, it seems to me like the relationship between the two of you is difficult? --- Yes, it is, and I know where you're probably getting at with this, and people have - and Lee's asked me himself, and whilst I'm getting a little bit emotional today, and I apologise for that; it's not usually how I am, I am a professional and I can put that all to one side and get in and get the job done, and I know once we move past this I will 100 per cent forget about everything that he's lied about or said and get on with getting the job done, because (1) that's what I've chosen, and that's my right, I believe, and (2) I believe honestly that there is a responsibility to those shareholders that I do so, because when we started this business I was the backbone of the business experience. Lee didn't have the business experience, he had an electrician's qualification, and I was the one steering the business and leading everything, but unfortunately, because we both started it and I'm not ego driven or position driven, he self appointed himself as a CEO role. Well, before we had investors on board it was only the two of us, and now, looking back, that was a big mistake, because I could have self appointed myself as a CEO role and we'd be in a different position now, where I could make him redundant because we've split up. I feel that in today's environment, with the way women are treated in the workplace, this is cookie cutter example of how we're being mistreated. Through no fault of my own, I'm being pushed to one side, and I guess I'm partly doing it for my right to be in this job, and as I said, whilst it may appear I'm emotional today, which I clearly am, I am professional. In my whole 20 years of corporate marketing experience I have never cried on the job or lost my professionalism.” 24

[46] Mr Castrisos said that the Applicant told him numerous times leading up to the receipt of her redundancy letter, that Mr Ranchod had stated that he would not allow the Applicant to work for the Respondent because of their personal relationship troubles. The Applicant also informed Mr Castrisos that she was being shut out of the business activity for months preventing her from doing her job, prior to the receipt of the redundancy letter and that Mr Ranchod had fired her on several occasions when in the middle of a personal disagreement. Mr Ranchod also confirmed to Mr Castrisos in telephone calls that he no longer wanted the Applicant working in the business because of the breakdown of their personal relationship. Mr Ranchod also told Mr Castrisos that the business was doing very well and worth millions of dollars.

[47] Mr Castrisos said that he was not surprised that Mr Ranchod had issued the Applicant with a redundancy letter on what appeared to unreasonable and unjustifiable grounds. Mr Castrisos has known Mr Ranchod for over 20 years. While they had a good father-in-law/son-in-law relationship, Mr Castrisos contended that Mr Ranchod is untrustworthy, an opportunist and prone to lying and Mr Ranchod has previously skited about cheating the system and his ability to win any court case or pre-court mediation settlement matter he had been in, whether with staff or previous business associates, regardless of whether he was in the wrong.

[48] Ms Cooke and her husband have been long-time friends of Mr Ranchod and the Applicant and Ms Cooke has been “across the journey of their business”. Ms Cooke’s house was the venue for an interview the Applicant scheduled with channel 7 News on 25 June 2014 and Ms Ranchod was interviewed a day later and appeared on the Channel 7 Sunrise program regarding their business and the latest technology.

[49] Ms Cooke completed a digital marketing course with the Applicant in November 2020 and spent a lot of time at the house shared by the Applicant and Mr Ranchod, to run through course content and bounce off marketing strategies. The Applicant primarily worked from home and was involved in developing a digital marketing strategy for the Respondent’s new keyless blue tooth door locks – LockSmart. During this period, Mr Ranchod told Ms Cooke many times how well the business was going and that it was doing well financially. Mr Ranchod also told Ms Cooke prior to the Applicant’s dismissal, that the Applicant was no longer working in the business because he wanted to keep personal and business matters separate.

[50] Ms Cooke also said that during the same period, the Applicant advised that she was being edged out of the business because of personal issues and that this had worsened after her formal separation from Mr Ranchod. The Applicant told Ms Cooke at this time that Mr Ranchod had prevented her from doing her job by withholding information and that the Applicant had no longer been provided with a key to the workplace. Ms Cooke also observed Mr Ranchod engaging in what she observed to be a daily ritual of sleeping in until 9.00 am, going out during the morning and then enjoying lunch and long sessions playing on his X Box. It is Ms Cooke’s view that the dismissal of the Applicant was instigated due to the relationship breakdown between Mr Ranchod and the Applicant, given that Mr Ranchod had previously told Ms Cooke how good the Applicant was for the business.

[51] In her closing submissions, the Applicant said that Mr Ranchod had not been truthful in his evidence to the Commission and that a conclusion should be drawn that her dismissal was because of their personal relationship and not because her role was redundant. Of the three roles that remain in the business (excluding Mr Ranchod’s role), the Applicant said that Paul was a poor performer and the CFO resides in America and it seemed illogical that the person that would be dismissed is the one who has been employed the longest, understands the business and is present in Australia. The Applicant also contended that she was doing those roles before the persons currently holding them came on board and that the redundancy was obviously a ruse to remove her from the business for personal reasons.

[52] In relation to the Respondent’s financial position, the Applicant asserted that as a start-up a business is not based on profit and there had been four capital raisings in the past. The Respondent now has over 100 investors evidencing that it is not “a one-off hit pony to get capital raising” and that there are options for further capital raisings. The Applicant also pointed to the fact that while the Respondent is currently operating at a loss, it has had worse losses in the past and it is her view that Mr Ranchod is using the temporary down-turn resulting from COVID-19 to cover what is really an unfair dismissal on the basis that Mr Ranchod simply wants to get rid of her because of the breakdown of their personal relationship.

[53] The Applicant stated that she has not gained employment since her dismissal but had been looking.²⁵ The Applicant also said that if this case did not go the way she hoped, an alternative job would be her next route but would take time because she had been with the Respondent for 9 years and had sacrificed her own corporate marketing career to start the business with Mr Ranchod and took a pay cut compared to her previous employment. The Applicant stated that she has been robbed unfairly of her income and her employment in the business without a cent in redundancy nor being paid her outstanding wage and leave entitlements including the March 2021 COVID-19 pay collected by the business on her behalf, and that this had occurred because of the breakdown of her personal relationship.

[54] A copy of the Applicant’s contract of employment was tendered by Mr Ranchod at the hearing, which was signed by the Applicant and Mr Ranchod.²⁶ Mr Ranchod relied on this contract of employment as evidencing that the employment relationship did not begin until 2016. The contract states the Applicant’s commencement date with the Respondent was 1 July 2016 in the role of Business/Marketing Director reporting to Mr Ranchod, CEO and Director.

[55] The Applicant’s contract of employment included the following details about the Applicant’s role:

“Role Purpose

The Business Director directs the business development and marketing activities of the organization, playing a key role in the company's marketing and bottom line.

Minimum Skills Required

Attention to detail

Experience in working with senior management to align sa les strategies and solutions

Experience of working in a corporate/business focused environment

Excellent negotiation skills, proven track record of successfully pitching for new business

Personal Specification

A strong work ethic and 'can-do' problem solving attitude

Proactive and results driven whilst being personable and flexible internally and with clients

Ability to multitask, prioritize and work to deadlines

Tasks and Responsibilities

Responsible for the overall management of all strategic and operational Marketing and Customer Relationship activities.

Provide market feedback to the company leadership regarding competitive offerings, prospect needs and generate product development ideas.

Take ownership of the management of the sales and marketing functions of the business.

Drive increased revenue and profit to achieve the Company's ambitious growth.

Working to stringent targets, the job holder will be required to adopt a professional and knowledgeable approach to each new business call.

Planning and coordinating the implementation of business plans and the penetration of new markets.”

[56] The contract states that the total remuneration package for the Applicant’s role was $153,300 per annum, comprised of a salary of $140,000 and $13,300 in superannuation contributions. The contract does not include reference to the provision or use of a Company vehicle. The Applicant contended that her employment commenced before she signed the contract of employment and that prior to 2016, written contracts of employment were not provided by the Respondent. The Applicant said that this only occurred when investors came on board.

[57] In his witness statement, Mr Ranchod said that in March 2020 as the COVID-19 pandemic began in Australia, he decided that the Company had to make huge cutbacks on all fronts as a result of cashflow issues. All staff were either let go or converted to part-time as the Company could not afford to keep on any full-time staff. The Company relied on JobKeeper to keep part-time staff on, and at the time of the hearing, the situation had not changed. The Applicant was also employed on a part-time basis during this time.

[58] Mr Ranchod said that due to the financial situation of the Company and other business factors, the Respondent decided that a marketing person was not affordable nor required at this stage. The Applicant was previously in charge of tasks like press releases and product launches, but the company did not have any new products so there was not much for the Applicant to do in relation to marketing.²⁷
The Applicant was notified by letter on 2 March 2021 that her position would be made redundant and was given 3 weeks’ notice that her employment would end. The letter informing the Applicant that her position was redundant was in the following terms:

“Dear Maria,

Notice of Redundancy

We regret to inform you that your position in the company has become redundant due to which we are serving you this notice.

Based on your length of service, your notice period is 3 (three) weeks, being 23 March 2021.

Your final payment will be actioned upon proper handover of all company assets including:

1. Company laptop

2. All company passwords and login details

3. Company vehicle (Mercedes Benz, [Registration details])

4. Any other property belonging to the company

Wishing you all the best in your future pursuits.”

[59] Mr Ranchod contended that there were no other suitable roles in the company which the Applicant was qualified to perform and that the Applicant’s duties were distributed to other employees of the business. Other than Mr Ranchod as CEO, there were only two part-time staff working at the Company at the date of the hearing, neither of whom are employed in a marketing capacity. The remaining staff assist in daily operations, including book-keeping and running the business.

[60] In oral evidence, Mr Ranchod said that the Respondent was claiming JobKeeper for the period it was available, which ended in March 2021. From a cashflow point of view, the remaining employees were still part-time. Mr Ranchod also said that the CFO was working for roughly five to six hours a week, which was somewhere around $2,000 per month as she is paid on an hourly basis.²⁸ The technical/operations employee (Paul) was continuing to be paid $750 which was about five hours per day. Further, Mr Ranchod said that at the time of the hearing, he had not drawn a wage for about seven weeks and had been receiving Job Keeper. Mr Ranchod’s wage was previously $180,000.00 per annum.²⁹

[61] Mr Ranchod maintained that there was no more money and that Company had to make cuts to avoid insolvency. As CEO of the Company, Mr Ranchod’s first responsibility is to shareholders and Mr Ranchod stated that they had drawn a clear line in the sand by advising that they would not provide further funding to the Company.³⁰ Mr Ranchod said that as the business is not making profit, it is required to make cuts and cannot just keep running on as there is not an endless stream of money.³¹

[62] Mr Ranchod did not tender any of the Respondent’s financial records and instead, set out in his witness statement what he described as “a summary of the Company’s financials over the past three quarters.” The figures set out by Mr Ranchod indicate that in the September 2020 quarter the Company made a Net Loss of $58,473.00, a Net Loss of $90,823.00 in the December 2020 quarter and a net Profit of $255.00 in the March 2021 quarter, with an overall Net Loss during this period of $149,041.00. This was said to establish that the Company was running at a substantial loss and the “reason the cut backs had to happen”.³²

[63] In his oral evidence at the hearing, Mr Ranchod stated that at the time of the hearing, the company was around three months from insolvency. According to Mr Ranchod, the Company had to cut costs, and the biggest cost the business had was staff. Mr Ranchod’s evidence was that the Applicant was on a $153,300 salary and had an $80,000 car, making the Applicant the most expensive staff member on the books, and therefore the Applicant had to be made redundant.³³ Mr Ranchod also said that Applicant’s role was shared with existing staff, as the Respondent did not have a budget for a dedicated marketing position or any other position due to cashflow issues. Mr Ranchod further stated that due to costs factors, the only marketing the company can do presently is emailing, as there is no cost associated with that.³⁴

[64] In response to questions from me, Mr Ranchod said that prior to the events that caused a reduction in the Respondent’s employees to four, there had been ten to twelve employees. The Respondent had slowly been scaling down because funding from its investors was drying up before COVID-19 hit. Mr Ranchod also said that the Applicant was not performing any duties at the time it was decided to make her role redundant and no-one in the office had seen the Applicant for six or seven months. Mr Ranchod said that at the point the Applicant was dismissed, the Respondent had four employees who were working on a part-time basis and in receipt of JobKeeper payments – Mr Ranchod as CEO, the Applicant in a marketing position, “Anne” as the CFO and “Paul” as a technical and operations employee who does “all the technical and operational stuff with the products”.³⁵ The Applicant’s salary was $153,300 plus a vehicle, the CFO’s salary was $100,000 and the salary of the technical and operations employee, was $65,00.00.³⁶ Mr Ranchod also said that the CFO was working remotely from the United States and continues to do so, working roughly five hours per week equating to a salary of $2,000.00 per month based on her annual salary of $100,000.00 per annum. In the period prior to the Applicant’s position being made redundant, the Applicant was doing minimal campaigns and there were emails going back and forth.

[65] Mr Ranchod said that prior to the reduction in the Respondent’s business referred to in his evidence, the Applicant’s duties were primarily restricted to marketing. Mr Ranchod stated that the Applicant did not “co-found” the business in 2012, and her employment only started in July 2016.³⁷ Mr Ranchod also said that the Applicant was “a mum at home to our two children” and did “a few little things” with their business, which at the time, was a wholesale business.³⁸

[66] According to Mr Ranchod, after the Applicant commenced employment with the Respondent, she did marketing and Public Relations but did not run sales as stated in her evidence. Mr Ranchod stated that the Applicant is extremely talented at what she does and that there were no issues with her work. Mr Ranchod also stated that the Respondent would have liked to keep the Applicant on and would need someone in a marketing role moving forward “when we potentially get funds”. Mr Ranchod went on to say that the Respondent does not have funds now and this is the reason for the Applicant’s dismissal.³⁹

[67] Mr Ranchod was asked by me whether he considered any other roles for the Applicant within the Respondent’s business before deciding to terminate her employment. Mr Ranchod said “absolutely” and that there were never any issues with the Applicant’s work. Mr Ranchod said that the Applicant could not do the CFO role because she is not a Certified Practicing Accountant and the Respondent needed a person with this qualification because it is a publicly listed company. Mr Ranchod also said that the Applicant is not technically minded so could not do the technical operations and support role.

[68] In relation to the engagement of Mr Daunt in marketing, Mr Ranchod said that Mr Daunt did some contracting work in marketing for the Respondent for about two months commencing in January and the Respondent could not afford to pay him. The Applicant had a meeting with Mr Daunt because the Respondent wanted them to work together but this did not work out. In response to questions from me about what discussions he had with the Applicant about the possibility of her position being made redundant, Mr Ranchod said that the Applicant was aware of the company’s financial status and in December 2019, he sent the Applicant full financial records and said that they were going to have to make cutbacks and potentially part ways because they could not afford her. Mr Ranchod also said that while the letter advising the Applicant that her position had been made redundant gave the Applicant three weeks’ notice of the termination of her employment, payment in lieu of notice was not made to the Applicant and had not been made when this application was heard.

[69] Mr Ranchod said that the Applicant’s notice and accrued entitlements had not been paid because she had not returned her Company vehicle and indicated that while the Applicant had accrued entitlements they would not be paid until she returned the vehicle. The Applicant said in response that although the vehicle had been purchased through the Company it was her personal vehicle and used for transporting the children she shares with Mr Ranchod. In response to a proposition put by me that the Respondent was not entitled to withhold payment of entitlements to the Applicant in such circumstances and that if the Respondent had a claim on the vehicle it should pursue that through a court, Mr Ranchod said that while this was correct in normal circumstances “…it’s a little bit of a tricky situation because she is my ex-wife and I was trying to hopefully come to a reasonable resolution rather than going down that road.”

[70] Under cross-examination, Mr Ranchod agreed that the Applicant’s vehicle was not provided for in her contract of employment. In response to the proposition that they had gone to purchase their vehicles together and that the Applicant had her vehicle before she worked for the business, Mr Ranchod said that the vehicle is registered to the business. Mr Ranchod also said that the vehicle was not relevant and would be dealt with by another court.

[71] Under cross examination, Mr Ranchod agreed that the Applicant was the only person whose employment was terminated at the time of the COVID-19 Pandemic impacting. In response to a proposition that he came home from work and played X Box while the Applicant was working, Mr Ranchod said that the Applicant was working on a marketing course rather than the business and disagreed that he had commented that the Applicant was working too much. Mr Ranchod was asked whether he had a contract of employment with the Respondent and said that as a founder of the business he did not have a contract. Later, Mr Ranchod’s contract of employment with the Respondent, also dated 1 July 2016 was shown to him during cross-examination and tendered.⁴⁰ Mr Ranchod accepted that he had signed a contract of employment in 2016 and said that he may have been required to sign the document because the Company was publicly listed in 2016. ⁴¹

[72] Mr Ranchod was also asked in cross-examination why the Applicant’s position was listed as “Founder and Marketing Director” in business documentation, marketing material and on Wikipedia. Mr Ranchod said that this was because the Applicant wrote these documents.⁴² Mr Ranchod was also cross-examined about an appearance the Applicant undertook on the Sunrise television show in 2014, where she discussed the Respondent’s products. It was put to Mr Ranchod that the footage had been used in the Respondent’s marketing on YouTube and in all marketing material and in presentations to investors. Mr Ranchod maintained that he could not remember the Applicant appearing on the Sunrise television show in 2014.

[73] Mr Ranchod also said that in a marriage you do things together in partnership and conceded that prior to 2016 the Applicant was helping out with the Company.⁴³ Mr Ranchod disagreed with the proposition that including references to the Applicant being a founder the business in marketing material sent to investors, was dishonest and said:

“…Technically – I didn’t give that a lot of thought at the time, but technically you were my partner at the time, which at the end of the day we were together. I didn’t have an issue with calling you a founder, and I still don’t have an issue if you want to call yourself a founder. That’s not why we are here today.”44

[74] In response to a proposition that he had lied on multiple instances about the Applicant’s involvement in the business Later Mr Ranchod said it was “technically incorrect” to give investors information stating that the Applicant was a founder of the business. Mr Ranchod further confirmed that the Applicant was classed as an owner of the business because of their marriage, which meant that she would get a share of whatever he had in the business. Mr Ranchod also stated that the Applicant was technically an owner, but not on paper.⁴⁵

[75] Mr Ranchod accepted that the business has made losses of over $1 million in previous years and that it had made a smaller loss in the three quarters set out in his witness statement. However, Mr Ranchod maintained that the only reason for this was that in previous years the Respondent had 12 or 13 employees and was now down to three. In response to the proposition in cross-examination that the Applicant could have been redeployed into the technical support role, Mr Ranchod said that Paul who is in that role is the Respondent’s main technical support person. In this role, he installs locks, does handovers, undertakes problem solving and deals with customer issues. Mr Ranchod did not agree with the proposition that the Applicant had briefed suppliers which was now undertaken by Paul and maintained that she did not understand coding. In response to the proposition that installation was done by a contractor, Mr Ranchod said that this is no longer the case. Mr Ranchod agreed that there had been some issues with Paul’s performance but maintained that these had been addressed and that the Applicant did not have the technical expertise to undertake this role.

[76] Mr Ranchod maintained that he told the Applicant in advance that her position was to be made redundant and said that the written evidence of this is the letter sent to the Applicant advising her of her dismissal. Mr Ranchod denied stating that he did not want to work with the Applicant because of their marriage breakdown but agreed that he asked the Applicant why she would want to work with him. Mr Ranchod said that he did this out of concern that the Applicant would be comfortable after their marriage breakup which can be quite traumatic.

[77] In his closing submissions, Mr Ranchod maintained that the Respondent made the Applicant redundant as it would have done so regardless of the identity of the person in her role. The dismissal had nothing to do with the personal relationship between Mr Ranchod and the Applicant but was about the best interests of the shareholders and the fact that the Respondent could not afford the Applicant’s salary. Mr Ranchod contended that if the business did not turn around in the next three months it would be insolvent. According to Mr Ranchod, there are three people in the business and the “first port of call” if the business survived would be returning them to full time employment. There would be no point having a fourth person employed on a part-time basis and cuts had to be made.

[78] In response to a question from me as to why cuts had not been made in the past, despite the Company previously making losses, Mr Ranchod said that this was because the funders were previously happy to keep funding the Company and there was potential business on the horizon with a few big deals that had subsequently fallen through. Mr Ranchod was unable to state when the deals fell through but stated that the Respondent’s investors had advised just before COVID-19 hit, that there was no more funding. In response to a question in relation to the form that the advice from investors took, Mr Ranchod said it consisted of a telephone call and a meeting in Melbourne with Mr Ben Morrisey of Shaw and Partners, the principal investor in the Respondent, who stated that there was no more funding for the Company. Mr Ranchod maintained that if any award of compensation was made to the Applicant the Respondent would be insolvent.

[79] Despite Mr Ranchod’s failure to provide any cogent evidence or submissions in relation to the Respondent’s financial capacity, I gave the Respondent a further opportunity to file such material. Mr Ranchod filed further material which was of little probative value in relation to his assertions. The material filed by Mr Ranchod consisted of a letter from Mr Ben Morrissey, Senior Client Adviser, Shaw and Partners Limited. The letter is in the following terms:

“I have been asked to provide a letter detailing Dog and Bone’s financial position, Shaw and Partners have been and continue to be the major investors in Dog and Bone Holdings and have been since we started funding the business in 2015. The business has been unprofitable and burning through investors’ capital for many years. This situation has deteriorated further still over the past 15 months due to the crippling effects of COVID-19.

We do not have any desire nor capacity to continue to fund the business. The business is on life support and we will not be bailing it out again. If an order is granted against the business, it will result in the company’s insolvency, and all lenders and investors losing their money.

The remaining three staff are being remunerated on a part time basis and are called upon when required. We have only allowed the CEO, Lee Ranchod, to draw one monthly payment since the end of March when Jobkeeper rolled off.

The redundancy of Ms Maria Ranchod was both essential and long overdue given the complete lack of revenue generation by Dog and Bone. The company is on its knees which a 10 second glance at the accounts will attest to, and all cost cutting decisions have been made in an effort to keep the business alive.

I understand that Lee Ranchod and Maria Ranchod are undergoing a separation which is a private and deeply painful process and is the only reason that I can think of as to why Ms Ranchod is seeking some sort of payment from the company. But to be brutally honest, I have been pushing for her removal for well over two years and it was actually Lee who convinced me to keep her employed. That time has well past, and we are now entirely focussed on the company’s survival.”

[80] A covering email sent by Mr Ranchod with the letter from Mr Morrissey, stated:

“Please see attached letter from our investment group. I have also attached a trade creditors list and an image of our total cash in hand. As you will note, we currently have $273,861.00 in debt and have a total of Approx $20K AUD in our bank. We have wages to come out on the 15th of next month totalling approx. $6,000 and we have to service the trade creditors list. The only income the business has is approx. $12,000 to come in at the end of June which will go straight to servicing the debt so we remain solvent. The company has also been paying for the company car at the cost of $1300 per month for the lease that she has for the past four years and will not return.”

[81] A list of trade creditors and what appear to be screen shots of various bank accounts, was also attached to the email. The Applicant made a submission in response to this material, which included statements and documents that were not related to the Respondent’s further material on financial capacity and which could and should have been included in the Applicant’s witness statements or tendered by the Applicant at the hearing. I have disregarded that material. To the extent that the Applicant’s further submission was responsive to the material said to evidence financial incapacity filed by Mr Ranchod after the hearing, the Applicant contended that the Respondent had failed to provide full financial statements resulting in insufficient evidence that it would be insolvent if an award of compensation was made in her favour. The Applicant said that it would seem unthinkable that the Directors of a business that have received over $6million in investor funding, in addition to the initial investment by the owners, would allow the business to go insolvent because of a justifiable employment claim, which is small in comparison with the costs of developing the technology and running the business. The Applicant also pointed to the fact that in its outline of argument, the Respondent had ticked boxes on the Commission’s pro-forma document responding as to the following questions as set out below:

“Do you still need someone to do the employee’s job? Yes.

Have there been changes to the operational requirements of the business? No.

Do you no longer require the employee’s job to be done by anyone due to the operational requirements of the business? No.”

[82] The Applicant said that Mr Morrissey’s letter was a display of “boys club” culture, and this is the view of one shareholder from an estimated 100 shareholders within the business.

Consideration

Whether the dismissal was a case of genuine redundancy

Evidence

[83] It is necessary to make some general comments about the evidence tendered by the parties in this matter. The Respondent raised a jurisdictional objection to the application on the grounds that it asserts the Applicant’s dismissal was a case of genuine redundancy. The Respondent’s objection will fail unless the Commission is satisfied, in accordance with s. 389(1), that:

•  the employer no longer required the dismissed employee’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and

•  if there was any obligation in an applicable modern award or enterprise agreement to consult about the redundancy the employer complied with that obligation.

[84] The Commission must also be satisfied as to whether the exception in s. 389(2) to a dismissal being found to be a genuine redundancy is enlivened on the ground that redeployment would have been reasonable in all the circumstances. To the extent that the Respondent’s objection would fail if no evidence or further evidence about these matters was given, the evidentiary onus to establish them lies with the Respondent.⁴⁶

[85] The Respondent filed material in relation to the jurisdictional objection which made various assertions and contained no documentary evidence to support those assertions. The Respondent did not tender financial records in relation to its position both before and after the Applicant’s dismissal and instead set out figures in Mr Ranchod’s statement, for a limited period of time encompassing the September 2020 to March 2021 quarters. The Respondent did not file evidence about the composition of its workforce before and after the Applicant’s dismissal or the nature of the work that was required to be performed by each employee before and after the Applicant’s dismissal, how that work was performed and who was performing it. It was necessary for me to attempt to elicit relevant evidence from Mr Ranchod.

[86] While I appreciate Mr Morrissey’s advice that a ten second glance at the Respondent’s accounts would attest to the fact that it is “on its knees”, I have not been provided with those accounts by the Respondent. It would have been of assistance if Mr Morrissey had provided more and better financial information. Mr Ranchod’s evidence about the Respondent’s financial position, operations and staff was surprisingly vague and was insufficient to establish the basis for a jurisdictional objection on the ground of genuine redundancy. This was despite Mr Ranchod being given several opportunities to place such evidence before the Commission and a further opportunity to establish an evidentiary basis for his assertions about the Respondent’s financial incapacity and that it would be insolvent if any award of compensation was made in favour of the Applicant.

[87] Further, in the template document used by the Respondent to set out its outline of argument in relation to the jurisdictional objection, a box is ticked indicating that there have been no changes in the operational requirements of the Respondent’s business. In response to a template in that document, as to whether it no longer requires the employee’s job to be done by anyone because of changes to its operational requirements, the Respondent has also ticked a box to answer the question: “No”. Also in response to a question in the template document about whether the possibility of moving the Applicant into another position, the box has been ticked to answer the question “No”. While the Respondent cannot be criticised for using a Commission template to set out its outline of argument, it is regrettable that the information provided is at odds with Mr Ranchod’s evidence in these proceedings. The Respondent also failed to file material in response to the Applicant’s material, contrary to the Directions. As a result there is evidence from the Applicant which is uncontested, other than by the assertions of Mr Ranchod in cross-examination and in response to questions from me.

[88] The Applicant in the present case contends that there is a basis upon which the Commission could be satisfied that her dismissal was not a case of genuine redundancy. Accordingly, the Applicant also carries an evidentiary onus to establish the facts on which she relies by placing evidence before the Commission that supports the finding she seeks. The Applicant has given evidence to the Commission which, if accepted, could support such a finding. By failing to advance evidence sufficient to support its case risks that evidence being accepted if it does not advance evidence to the contrary or evidence to establish an alternative conclusion that it submits the Commission should reach.

[89] The Directions I issued in the present matter reflected that the onus proof may shift in the manner I have outlined above. For this reason, the Directions required that the Respondent file evidence and submissions in relation to its jurisdictional objection (genuine redundancy), and at the same time, the Applicant file evidence and submissions in relation to merit (whether her dismissal was unfair). The Directions then provided for each party to respond to the material filed by the other party. While there were issues with the form (and some of the content) of the Applicant’s evidence and submissions, the Applicant filed material in accordance with the Directions, and addressed the relevant legislative provisions.

[90] In assessing the evidence given by the Applicant and Mr Ranchod, I have made allowances for the apparent acrimony between them as a result of the breakdown of their marriage. Even making such an allowance for Mr Ranchod I did not find him to be a convincing witness. Mr Ranchod was vague about details of when various events occurred and gave every impression of doing all that he could to downplay the role that the Applicant played in establishing the business. Mr Ranchod’s comments that the Applicant was a mum who looked after their children did him no credit and I accept the Applicant’s clear and cogent evidence about her role in getting the business established and the skills she brought to it. That Mr Ranchod would forget that his then spouse appeared on a national television program promoting their business and its products is surprising and strains credibility despite the fact that this occurred in 2014.

[91] Mr Ranchod’s insistence that he had not signed an employment contract was a further indication of his preparedness to deny a matter to simply damage the Applicant’s case. Clearly, the fact that both contracts were signed on the same day supports the Applicant’s version of events to the effect that the written contracts were entered into when the business was publicly listed and that her contract of employment was signed well after she commenced working in the business. It is also significant that Mr Ranchod only produced the Applicant’s contract of employment at the hearing and did not append it to a witness statement to place the Applicant on notice of his contentions based on the contract. Despite this the Applicant provided a credible explanation for the date her contract of employment was signed and tendered a copy of Mr Ranchod’s contract, which was signed on the same date, to support her evidence on this point.

[92] Further, Mr Ranchod’s explanation for the Applicant being held out to investors and the public as a co-founder of the business, to the effect that this was because the Applicant prepared the documents making these statements, is not credible. Alternatively, Mr Ranchod’s evidence indicates that Mr Ranchod is unconcerned about incorrect information being promulgated by a Company of which he is a Director and CEO.

[93] In contrast and making allowances for her anger and distress about matters relating to the breakdown of her marriage to Mr Ranchod, I found the Applicant to be a credible witness. The Applicant made concessions when it was appropriate for her to do so and used her best endeavours to articulate her case. Mr Ranchod cannot complain of lack of information about the Applicant’s case and his failure to properly respond to it suggests that he was simply going through the motions of advancing a jurisdictional objection to the unfair dismissal application and cannot be explained by any failure on the part of the Applicant.

[94] In general, the Applicant presented as an intelligent and articulate person with the capacity to undertake the role she claims to have undertaken with the Respondent including some, but not all, aspects of the roles now performed by the technical operations person and the CFO. It is also apparent that the Applicant has a detailed knowledge of the Respondent’s business and its history. I accept that the Applicant co-founded the business and invested her personal funds to do so. Further I accept that notwithstanding her caring responsibilities to her then husband and children, the Applicant worked in the business and made a significant contribution to it from its inception in 2012 and that her employment commenced at that time rather than in 2016 as asserted by Mr Ranchod. Mr Ranchod’s assertion that the Applicant was helping him out with certain tasks because he was her husband, is totally at odds with the evidence tendered by Ms Ranchod establishing her significant role in the business well before 2016 when she signed a contract of employment. I accept that the contract was signed in 2016 to regularise what was an existing employment relationship because the Respondent was to be publicly listed, and that Mr Ranchod signed an employment contract at the same time, for the same reason.

[95] However, I am also conscious that I am dealing with an application for an unfair dismissal remedy relating to the Applicant’s rights as an employee. Any interest, equitable or otherwise, that the Applicant has in the Respondent’s business, other than an interest relevant to whether she has been unfairly dismissed, is a matter for other proceedings. I turn now to consider the evidence in this case relevant to the matters I am required to determine.

Whether the employer no longer required the employee’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise (s 389(1)(a))

[96] As I have previously noted, having raised the jurisdictional objection to the application, the Respondent bore the onus of establishing that it no longer required the employee’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise. In my view, the Respondent has not met its onus. While I accept that Mr Ranchod’s evidence established a reduced need for marketing, and that COVID-19 has adversely affected the Respondent’s business, there is insufficient evidence about the operational requirements of the enterprise, much less that there have been changes to those operational requirements, for me to be satisfied that the Respondent no longer required the Applicant’s job to be performed by anyone, because of changes in those requirements.

[97] There was no detailed evidence about the products that the Respondent sells or its customer base or market. Mr Ranchod said that the Company had no new products and that marketing was not required. The Applicant asserted that the Respondent was in the process of bringing a new lock to the market and that there was a need for a marketing campaign with respect to this product. Mr Ranchod did not contradict this evidence and gave evidence in apparent contradiction to his earlier evidence and stated that the new lock had been installed in two apartment buildings.

[98] Contrary to Mr Ranchod’s evidence about a reduction in the need for marketing, the evidence of the Applicant, which was also not contradicted by Mr Ranchod, established that before her dismissal, the Respondent engaged a contractor to work with the Applicant on a marketing strategy. The fact that this did not succeed is not to the point. What is relevant is that several months prior to the Applicant’s dismissal, the Respondent, through its CEO Mr Ranchod, engaged an additional marketing person. Given Mr Ranchod’s emphatic evidence about how good the Applicant was at her job and that her dismissal had nothing to do with her work performance, I do not accept Mr Ranchod’s attempt to suggest later in his evidence that the additional marketing person was engaged because Ms Ranchod’s performance in her role was inadequate.

[99] On balance, I accept Mr Ranchod’s evidence that the Respondent is in difficult financial circumstances. The fact that Mr Ranchod has been talking up the business despite these difficulties is not to the point. The Applicant’s witness Mr Castrisos said that Mr Ranchod has been known to skite about the success of the business and the Applicant cannot rely on his comments to potential investors to found an argument that the business is doing well, in light of the losses it has sustained. However, it is also apparent from Mr Ranchod’s evidence that the Respondent is seeking new funding and its present difficulties may be temporary situation. Mr Ranchod also gave evidence that he anticipates that a dedicated marketing person will be required in future if he turns the Company around as he hopes to do.

[100] I also accept the Applicant’s contention that the Company has operated at a loss from the outset and its position in the current financial year is comparatively stronger than it has been in previous years despite the impact of COVID-19. While this may be because of reductions in staff numbers, the figures tendered by Mr Ranchod cover quarters when the Applicant was still employed. If the recent improvement is based on an injection from the Respondent’s investors, then this has also occurred in the past to keep the Company operating when it has had bigger financial losses. As the Applicant contended, it is likely that investors, having sunk such significant sums into the Respondent, would consider that the best option to recoup those funds would be to invest more and hope for an improvement post COVID-19 on the basis of new products.

[101] Further, I accept the force of the Applicant’s assertion that investors who have expended these amounts would not allow the Company to become insolvent over an award of compensation for unfair dismissal which will be significantly less than the amounts the investors stand to lose, and which they will not recoup, if the business does become insolvent. Essentially, it is equally probable that investors will invest more funds to avoid losing the funds that they have previously invested.

[102] It is also the case that Mr Ranchod reduced the hours of work and salaries of other employees during the period when COVID-19 impacted and there is no reason why he could not have attempted to take this step with the Applicant in order to maintain her in employment until the situation improved. That the Applicant may not have accepted such a proposal is a matter to which I will return.

[103] The letter from the Respondent’s investor Mr Morrissey, was tendered in the context of Mr Ranchod attempting to establish that the Respondent could not pay an award of compensation if the jurisdictional objection did not succeed and the Applicant was found to have been unfairly dismissed. The letter is not directed to the substance of the jurisdictional objection on the basis of genuine redundancy. It also makes clear that Mr Morrissey has been pushing for the Applicant’s “removal” for over two years, well before the changes wrought by COVID-19 and at least suggests that there is some other reason for the Applicant’s dismissal. Accordingly, I place little if any weight on Mr Morrissey’s statement for the purposes of considering whether the employer no longer required the employee’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise. There is no reason why a statement from Mr Morrissey could not have been filed by the Respondent in accordance with Directions and Mr Morrissey made available for cross-examination. The failure to take these steps is a further reason why I place little weight on the statement.

[104] Finally, I note that the outline of argument filed by the Respondent specifically states that there are no changes in the operational requirements of the Respondent and answers a question as to whether Applicant’s job is no longer required to be done by anyone, in the negative. The outline of argument also states that redeployment of the Applicant was not considered. While this may be an error on the part of the person who completed the submission, it is consistent with the balance of the evidence which did not address the necessary criteria for the jurisdictional objection to be upheld.

[105] I am left with the view that the downturn associated with COVID-19 was a convenient basis for the Respondent to dismiss the Applicant on the ground of redundancy, when in truth, had the Applicant and Mr Ranchod still been happily married, the Applicant would have remained in employment (albeit probably on a lesser income) while Mr Ranchod attempted to turn the business around to attract further funding from investors. There were no changes to the operational requirements of the business and based on Mr Ranchod’s evidence a marketing person would be required moving forward if the business survives. I also note that Mr Ranchod said in his evidence that further investment would be needed to revive the business and the Applicant’s uncontested evidence that her expertise includes investor relations.

[106] Accordingly, I am unable to be satisfied, on the balance of probabilities, that the employer no longer required the employee’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise.

Compliance with any consultation obligation in a modern award or enterprise agreement that applied to the employment (s 389(1)(b))

[107] For a dismissal to be a case of genuine redundancy within the meaning of s.389 of the Act, the Respondent must have complied with any obligation in a modern award or enterprise agreement to consult about the redundancy. In the present case, the Applicant does not assert that she was covered by a modern award. Given that the Applicant was a marketing manager earning a salary of $153,300.00 per annum, I find that the Applicant’s employment was not covered by a modern award, and there was no relevant consultation obligation for the purposes of s. 389(1)(b) of the FW Act.

Would it have been reasonable in all the circumstances for the person to be redeployed within the employer’s enterprise or the enterprise of an associated entity of the employer (s 389(2))

[108] As I have previously noted, the Respondent bears the onus of establishing an evidentiary basis for a finding that a dismissal was a case of genuine redundancy. Section 389(2) is framed in the past tense, so that the question of the reasonableness of redeployment is considered from the starting point of whether “it would have been reasonable in all the circumstances for the person to be redeployed”. That question is also considered on the basis that s. 389(2) is an exception by which a redundancy which is effected in a manner consistent with the requirements in s. 389(1) can otherwise be found not to be a genuine redundancy for the purposes of the employer having a complete defence to a claim for unfair dismissal.

[109] In my view, the circumstances which may be relevant to this consideration include whether the employer contemplated redeployment options and sought the views of the employee concerned about this matter, where it would have been reasonable to do so. In short, a retrospective assertion by an employer at a hearing in relation to an objection on the ground of genuine redundancy, to the effect that there were no positions into which the employee could have been redeployed, may not be sufficient to bring the dismissal within the meaning of genuine redundancy for the purposes of s. 389. This is particularly so in circumstances where there is no evidence of consideration of redeployment at the time the employee was dismissed,

[110] The only limitation on the circumstances which may be considered for the purposes of s. 389(2) is whether the matter is relevant to the reasonableness of redeployment. I do not accept that Mr Ranchod considered redeployment of the Applicant or offering her part-time employment in order to retain her until the impact of the COVID-19 Pandemic had subsided. Other relevant circumstances against which I have assessed the reasonableness of redeployment include the fact that all employees of the Respondent were on JobKeeper and working part-time at the point the Applicant was dismissed. The Respondent had attempted to engage a contractor to perform a marketing role prior to the dismissal of the Applicant, in circumstances where that was the Applicant’s role.

[111] It is relevant that the Applicant had been employed by the Respondent from its inception and was a co-founder. The Applicant had invested her own funds to assist in starting the business and was the spouse of the CEO (albeit estranged). The Applicant had an interest, both as an employee and effectively as a part-owner through her relationship with Mr Ranchod, in the ongoing success of the Company. Further, on Mr Ranchod’s own evidence there was no substantive work for any employee because of the impact of COVID-19, which begs the question as to why the Applicant was the employee whose role was considered to be no longer required. As I have already noted, there was no evidence of a change to the operational requirements of the enterprise related to the Applicant’s role as distinct from any other role.

[112] It was also the case that the Applicant had performed a range of work outside her marketing duties and there was some work she could have done, in the context of a small business with four employees, who were all working part-time and where there was a new product in the process of being launched. I see no reason why the Applicant could not have been offered a role with reduced hours and in my view, a part-time role performing similar duties to those an employee performed in a full-time role, is capable of being considered as redeployment for the purposes of s. 389(2) of the Act. It is relevant that the Applicant and Mr Ranchod were not on good terms at the time the Applicant was dismissed and this may be considered as a basis for a finding that redeployment would not have been reasonable. However, balanced against this consideration is the Applicant’s evidence that she could have conducted herself professionally despite her antipathy to Mr Ranchod.

[113] While the Applicant may not have been able to undertake all of the duties performed by the technical employee who was retained, her uncontested evidence was that she had undertaken part of those duties when the business was started. The Applicant had also done some book-keeping and could have taken on at least some of the duties undertaken by the CFO. This is particularly the case when the CFO was located in the United States and was working on a limited basis. While it is true that a publicly listed company may require a more sophisticated financial and account keeping process than is undertaken by a book-keeper, on Mr Ranchod’s own evidence about the effect of COVID-19 on the Respondent, it is unlikely that there were many financial transactions to complete. Mr Ranchod’s evidence did not address redeployment and if he did consider this option at the time the Applicant was dismissed, it was only to a marketing position in circumstances where he also claimed that there was no such position. It was necessary for me to question Mr Ranchod to attempt to elicit evidence about consideration of redeployment and the oral evidence given by Mr Ranchod was inconsistent and contradictory.

[114] Accordingly, the Respondent has not established to the required standard, that it would not have been reasonable in the circumstances to redeploy the Applicant. I conclude that it would have been reasonable to do so, even if only to offer the Applicant a part-time position, consistent with other employees, to retain her in the business until the situation improved.

Conclusion on genuine redundancy

[115] I find that the Applicant’s dismissal was not a case of genuine redundancy within the meaning of s. 389 of the Act and that the jurisdictional objection fails. Accordingly, the Respondent does not have a complete defence against the Applicant’s unfair dismissal application and it is therefore necessary to consider whether the Applicant’s dismissal was unfair on the basis of the criteria in s. 387.

Whether the dismissal was unfair

Section 387 considerations

[116] The reason for the Applicant’s dismissal was not related to capacity or conduct and s. 387(a) of the Act is not relevant to whether the dismissal was unfair. The Applicant was not dismissed on the basis of capacity or conduct and the criterion in s. 387(b) in relation to notification of the reason for dismissal is also not relevant. In relation to s. 387(c) as the Applicant was not dismissed on the grounds of capacity or conduct, it is not necessary to consider whether she was given an opportunity to respond to allegations or had been warned about matters relating to capacity and conduct.

[117] In relation to s. 387(d) of the Act, there were no discussions related to the dismissal and no unfairness arises with respect to a support person. No unfairness arises on this basis. With respect to s. 387(f) and (g) of the Act the Respondent is a small business and does not have dedicated human resources management specialists. I have had regard to the size of the enterprise and the likely impact of the absence of such specialists on the manner in which the Applicant’s dismissal was dealt with.

[118] There are other relevant matters in relation to whether the Applicant’s dismissal was unfair which I have considered pursuant to s. 387(h). I am unable to be satisfied that the Applicant’s dismissal was a bona fide redundancy. In my view, Mr Ranchod took the opportunity of a downturn in the Respondent’s business due to the impact of COVID-19 to disguise the dismissal of his estranged wife as a redundancy. Mr Ranchod was unable to establish that the dismissal was a case of genuine redundancy due to his failure to place cogent evidence before the Commission to support his assertions, in circumstances where financial statements, information about organisational structure and restructure (if this had occurred), operational requirements, position descriptions and related matters, should all have been within his direct knowledge.

[119] There are other aspects of the dismissal which render it unfair. There was a failure to have any discussion with the Applicant or to consult her in relation to the decision to dismiss her on the ground of redundancy. Notwithstanding that there was no Award requirement to do so for the purposes of s. 389, this is also a relevant consideration under s. 387(h) in relation to whether the dismissal was unfair. The Applicant’s uncontested evidence is that she was locked out of the workplace for several months prior to her dismissal and advice that her role was to be made redundant was conveyed to her by letter. This was completely inappropriate in circumstances where the Applicant was a co-founder of the Respondent and had worked for the Company since its inception and had made a significant professional and financial contribution to the Company. It is not to the point that the personal relationship between Mr Ranchod and the Applicant was acrimonious. If Mr Ranchod wishes to deal with the Applicant on the basis that she is an employee who can be removed from the business by dismissal, then the quid pro quo is that the Applicant is entitled to exercise any rights that she has under employment law, including in relation to unfair dismissal.

[120] There was no consideration by Mr Ranchod as to whether the Applicant could be redeployed to another position within the enterprise or to giving the Applicant the option of reverting to part-time employment in the same way as other employees who remained in employment had done. The Applicant asserted that she was not consulted before her hours were reduced and she received JobKeeper payments and there has been a lack of consistency with respect to wages she has been paid while the Respondent was in receipt of JobKeeper subsidies. The Applicant was good at her job as was conceded by Mr Ranchod and if the business is turned around, a person to undertake marketing as the Applicant did, will be employed. Mr Ranchod does not assert that the Applicant was consulted about the reduction of her hours and I also note the Applicant’s evidence that she was excluded from the workplace for some months before her dismissal, another matter not disputed by Mr Ranchod. The failure to consult the Applicant about these matters is a further consideration going to the unfairness of her dismissal.

[121] It is also the case that the Applicant was a long serving employee who was a co-founder of the Respondent, had invested her own funds to assist with the establishment of the business, and on Mr Ranchod’s evidence had some rights as an owner because of their marriage. While I do not have jurisdiction to resolve any claim by the Applicant for unpaid wages, I am also of the view that failure to pay the Applicant her entitlements on termination, is a matter going to the unfairness of her dismissal. I note that if the Applicant was employed from the inception of the Company, her entitlement to notice is four weeks rather than three weeks. Secondly, the Respondent has purported to withhold this payment on the basis that the Applicant has not returned a Company vehicle. The Applicant’s evidence is that the vehicle was purchased through the Company for her personal use as was the vehicle driven by Mr Ranchod, and as such is not an entitlement under her contract of employment. Other than asking a rhetorical question of the Applicant as to whether the vehicle is registered to the Company, Mr Ranchod did not dispute the Applicant’s evidence on this point. The Applicant’s contract of employment also contains no reference to a company vehicle and Mr Ranchod accepted that this matter would be dealt with in other proceedings.

[122] I doubt that the Respondent has the right to withhold payment of notice and the Applicant’s accrued entitlements on termination, which are statutory entitlements under the National Employment Standards, because she has not returned a company vehicle. In any event, I accept the Applicant’s evidence that the vehicle is not a company vehicle. I am also of the view that if there was a genuine claim for the vehicle Mr Ranchod would have taken legal steps to repossess it. Further, I note that this is not a case of a former employee with no ongoing relationship with the Respondent, retaining its property. Fourthly, the Applicant is the spouse of Mr Ranchod, shares two children with him and uses the vehicle for purposes including transporting the children.

[123] The unfairness of withholding the Applicant’s statutory entitlements is further exacerbated by the unusual circumstances of this case, in that Mr Ranchod knew that the Applicant is at least partly responsible for the care and maintenance of the children he shares with her and withheld money which the Applicant would have needed to meet those responsibilities. This factor adds to the unfairness of withholding the Applicant’s statutory entitlements on termination while insisting that she returned a vehicle which is arguably not an incident of her contract of employment.

[124] Finally, I am of the view that when the evidence is considered in its totality, it is more probable than not that the fact that the Applicant was the estranged spouse of the CEO Mr Ranchod at the relevant time, played a role in her dismissal. Mr Ranchod’s attempts to rationalise the Applicant’s dismissal on the grounds of redundancy were entirely unconvincing and the letter provided by Mr Morrissey is also suggestive that other factors were at play in the decision to dismiss the Applicant. My view in this regard is also supported by the fact that the Applicant and Mr Ranchod separated in November 2020 and the Applicant was dismissed on 23 March 2021 after being excluded from the office for some months. In previous years when the financial situation of the Respondent was arguably worse than it was at the time the Applicant was dismissed, the Applicant was retained in employment. Further, at the point she was dismissed the Respondent was introducing a new product – a smart lock – the launch of which the Applicant was well equipped to be involved in and the Respondent will also require a further capital raising, involving shareholder relationships which the Applicant has considerable experience managing.

Conclusion in relation to unfair dismissal

[125] In all of the circumstances of this case, I am of the view that the dismissal was unfair. The dismissal was harsh because of its effect on the Applicant’s economic situation and in circumstances where the Applicant had a personal involvement in the business which went beyond that of an employee. The dismissal was unjust because it was implemented without any discussion with the Applicant with respect to options for her to remain employed in circumstances where there is evidence that the skills the Applicant holds will be required in the future if the business is able to be turned around. The dismissal was unreasonable because there was no valid basis for it in terms of the Applicant’s conduct and capacity and because no consideration was given to an alternative that was offered to other employees, to be employed on a part-time basis while attempts were made to turn the business around.

Given that I have found that the dismissal was unfair it is necessary to consider the question of remedy. As required by s. 390 of the Act I am satisfied that the Applicant is a person protected from unfair dismissal and that she was unfairly dismissed. I am also of the view that the Applicant should have a remedy for her unfair dismissal.

Remedy

Appropriate remedy and statutory considerations

[126] Having found that the Applicant was protected from unfair dismissal, and that her dismissal was unfair, it is necessary to consider what, if any, remedy should be granted to her. The Applicant sought reinstatement, which was opposed by the Respondent. While reinstatement is the primary remedy, I do not accept that it is appropriate in the circumstances of this case. Notwithstanding the Applicant’s insistence that she could work professionally with Mr Ranchod, despite their obvious and mutual antipathy, I am satisfied that reinstatement is inappropriate. In my view, after observing the conduct of Mr Ranchod and the Applicant at the hearing, their professional relationship is irretrievable and it would be inappropriate for both of them to be put back in a position of working together. I am also of the view that the Applicant’s principal reason for wanting reinstatement is to protect the interest she has in the business, other than her employment. That interest is not a matter over which the Fair Work Commission has jurisdiction and it is not a basis for granting a remedy of reinstatement.

[127] I am satisfied that an order for compensation would be appropriate. The Respondent has used its right as an employer to dismiss the Applicant from her employment with the Respondent, and by dismissing the Applicant has also effectively removed the Applicant from direct involvement with a Company she co-founded and in which she has a personal and financial stake. The Respondent has dismissed the Applicant from her employment because of reasons including the demise of her personal relationship with the Director and CEO of the Respondent. While the Applicant’s rights as a former spouse are not matters that can be litigated under the Act, the has a right to seek a remedy for unfair dismissal. For the reasons set out above, I have concluded that the Applicant was unfairly dismissed and that reinstatement is not appropriate.

[128] I have made the necessary findings that are prerequisite to awarding compensation. In relation to the assessment of compensation, s. 392 of the Act provides as follows:

“392 Remedy—compensation

Compensation

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

Criteria for deciding amounts

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

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

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

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

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

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

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

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

Misconduct reduces amount

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

Shock, distress etc. disregarded

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

Compensation cap

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

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

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

(6) The amount is the total of the following amounts:

(a) the total amount of remuneration:

(i) received by the person; or

(ii) to which the person was entitled;

(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and

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

[129] The approach to the calculation of compensation is set out in a decision of a Full Bench of the Australian Industrial Relations Commission in Sprigg v Paul’s Licensed Festival Supermarket. 47 That approach, with some refinement, has subsequently been endorsed and adopted by Full Benches of the Commission in Bowden v Ottrey Homes Cobram and District Retirement Villages inc T/A Ottrey;48 Jetstar Airways Pty Ltd v Neeteson-Lemkes49 and McCulloch v Calvary Health Care (McCulloch).50

[130] I turn now to the particular criteria I am required to consider in deciding the amount of compensation to be awarded to the Applicant for her unfair dismissal. In assessing compensation, I am required by s 392(2) of the Act to take into account all the circumstances of the case including the specific matters identified in paragraphs (a) to (g) of this subsection. The established approach to assessing compensation in unfair dismissal cases was set out in Sprigg v Paul Licensed Festival Supermarket  51 and applied and elaborated upon in the context of the current Act by Full Benches of the Commission in a number of cases as follows:52

Step 1: Estimate the remuneration the employee would have received, or have been likely to have received, if the employer had not terminated the employment (remuneration lost).

Step 2: Deduct monies earned since termination.

Step 3: Discount the remaining amount for contingencies.

Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.

Step 5: Apply the legislative cap on compensation.

Remuneration the Applicant would have received, or would have been likely to receive, if she had not been dismissed (s 392(2)(c))

[131] To calculate the remuneration the Applicant would have received or would have been likely to receive had she remained in employment, it is first necessary to determine an anticipated period of employment. This involves an element of speculation because the task involves an assessment of what would have been likely to happen in the future had the employee not been dismissed. 53

[132] While the Applicant’s employment and the breakdown of her personal relationship with Mr Ranchod were two separate matters, it is unrealistic to assume the Applicant would have remained in employment for a lengthy period. The Respondent is a small business and at the point the Applicant was dismissed, had four employees. The Applicant and Mr Ranchod are engaged in other legal proceedings and the proposition that the Applicant could continue to level accusations and allegations at Mr Ranchod of the kind that were levelled in the hearing of her application and work amicably alongside him, is one that I am unable to accept. It is not necessary that I repeat those allegations in this Decision.

[133] Mr Ranchod is the Director and CEO of the Respondent, and any interest the Applicant had, other than in her role as an employee, was as his wife. The Applicant has no right as an employee to insist on remaining in employment indefinitely and Mr Ranchod has the right to dismiss the Applicant, subject to exercising that right in a manner that is not unfair or unlawful. My estimation is that things would have come to a head within four months of the date the Applicant was dismissed, and the Applicant’s employment would have ended in any event. If the Applicant was offered part-time employment or a lower paid role, she may not have accepted the offer or may have accepted it for a limited period before obtaining other full-time employment. It is also likely that the personal relationship between the Applicant and Mr Ranchod would have deteriorated further making its continuation impracticable and that Mr Ranchod would have dismissed the Applicant or she would have resigned her employment.

[134] The Applicant’s contract of employment provided for an annual salary of $140,000.00 plus superannuation contributions of $13,000.30. This equates to an amount of $2692.30 per week in wages and $250.00 as superannuation contributions. The Applicant was dismissed with effect on 23 March 2021. The JobKeeper program ended on 28 March 2021 and at that time the Applicant would have been in receipt of JobKeeper payments in the amount of $1,000.00 per fortnight. Accordingly, during the anticipated period of employment the Applicant would have earned $500.00 from JobKeeper entitlements. Thereafter, in normal circumstances, the Applicant would have earned $40,384.50 – 15 weeks at a salary of $2692.30. This is a total of $40,884.50.

[135] However, the circumstances at the time were not normal. Mr Ranchod’s evidence is that all other employees had their hours reduced to part-time and had their wages reduced proportionately. Mr Ranchod states that he was also working part-time during the COVID-19 period and that he then received JobKeeper payments and then a part-time amount. Mr Ranchod also said that at the date of hearing, he had not drawn a wage since April 2021. Mr Morrissey’s correspondence did not enlighten me further and simply stated that investors had only allowed Mr Ranchod to draw one monthly payment after the end of March 2021.

[136] Mr Ranchod also said that the Technical Operations employee was working five hours per day and being paid $750.00 per week, and the CFO was working 5 hours per week remotely from the United States and being paid approximately $2,000.00 per month. I am satisfied that had the Applicant remained in employment her hours would have been reduced and her salary would also have reduced proportionately. Based on the hours being worked by the Technical Operations employee I find that the Applicant would have worked 25 hours per week and by dividing by a notional 38 hour week equating to an hourly rate of $70.85, the Applicant’s weekly earnings would have been $1,771.25 for the 15 week period from 30 March 2021, totalling $26,568.75. With the addition of the $500.00 JobKeeper payment for the week of 23 to 30 March 2021, the total amount of compensation is $27,068.65. In addition, the Applicant would have earned superannuation contributions in the amount of $2,571.50.

Remuneration earned (s 392(2)(e)) and income reasonably likely to be earned (s 392(2)(f))

[137] The Applicant has not obtained other employment and given the Applicant’s evidence that she has applied for some jobs and will increase her efforts if she does not achieve reinstatement in these proceedings, it is unlikely that she will find alternative employment in the period I have estimated that she would have remained employed. The Applicant’s explanation for not making concerted efforts to seek new employment is reasonable in the circumstances. Accordingly I make no deduction from the award of compensation on this basis.

Viability (s 392(2)(a))

[138] At the hearing, Mr Ranchod gave evidence that any award of compensation would send the company insolvent. 54 In his oral evidence, Mr Ranchod said that the Respondent had approximately $12,000.00 in the bank. In the additional material filed after the hearing, Mr Ranchod said in an email that the Respondent has $20,000.00 in its bank account and needed to pay wages of approximately $6,000.00 on 15 June 2021. According to Mr Ranchod, the only income the Respondent has is $12,000.00 to come in at the end of June which will go to service debt so that the Company can remain solvent. Further, Mr Ranchod said that the Commission should have regard for the payment of $1,300.00 per month the Company has made for the Applicant’s vehicle. Mr Ranchod also tendered the letter from Mr Morrissey set out above as evidence that an award of compensation to the Applicant would have an adverse effect on the Respondent’s viability.

[139] I do not accept Mr Ranchod’s evidence on this point. As I have previously noted, Mr Ranchod had two opportunities to establish any argument in relation to the effect of an award of compensation on the Respondent’s viability. There is insufficient evidence upon which I could be satisfied that the Respondent is insolvent as there is no information about its assets. While the financial situation appears to be dire, the Applicant makes a valid point – the interests of shareholders should not trump her rights to compensation for an unfair dismissal. Further, the Respondent’s investors have put money into the Company, and presumably have continued to do so, in order to protect their initial investment. If there is a risk of insolvency, then the investors can continue their past practice or not, and this is no reason to deny the Applicant compensation for her unfair dismissal.

[140] I am also of the view that if the Respondent circumstances are as dire as the figures advanced by Mr Ranchod suggest, then an award of compensation will make no difference to the Respondent’s position. If those figures are correct, and the Respondent has insufficient assets to meet its debts, then it is arguably insolvent regardless of any award of compensation to the Applicant. For the reasons set out above, I do not consider that the Applicant’s vehicle is part of her remuneration package and I accept that it is simply her personal vehicle bought through the Company. Accordingly, I make no deduction for the Applicant’s vehicle.

Length of service (s 392(2)(b))

[141] I am satisfied and find that the Applicant has 9 years’ service with the Respondent and that this supports an award of compensation.

Mitigation efforts (s 392(2)(d))

[142] For reasons set out above, the Applicant has made some attempt to mitigate the loss of her employment and has provided a reasonable explanation for her failure to obtain other employment. I make no deduction on this basis.

Any other relevant matters (s 392(2)(g))

[143] Given the period over which I have assessed compensation, I do not intend to make any deduction for contingencies. The Applicant has an interest in the Respondent’s business based on marriage to Mr Ranchod. That interest will be addressed in other proceedings. The Applicant may also have rights in relation to unpaid wages in addition to the amount of compensation I have assessed. The compensation amount does not include consideration for unpaid wages. The compensation amount recognises the Applicant’s rights as an employee and the fact that she was unfairly dismissed.

Misconduct (s 392(3))

[144] The Applicant did not engage in misconduct and I make no deduction on that basis.

Shock, distress or humiliation, or other analogous hurt (s 392(4))

[145] The amount of compensation I have awarded does not include compensation for shock, distress or humiliation or other analogous hurt. The Applicant’s claim in relation to the time, effort and financial investment she has expended to assist Mr Ranchod in the business, is a matter for other courts.

Compensation cap (s 392(5)-(6))

[146] It is not necessary to apply the cap in the circumstances of the amount of compensation I have determined to award.

Instalments (s 393)

[147] The Applicant pointed to the fact that compensation may be paid in instalments in response to Mr Ranchod’s evidence about the effect an order for compensation would have on the Respondent. If the Respondent seeks to advance a proposal for compensation to be paid in instalments, he should do so by 4.00 pm on Monday 18 October 2021. Mr Ranchod should note that any proposal he makes should be reasonable and that my provisional view is this would involve no more than four instalments over a four month period, with the first instalment being payable 28 days from the date of release of this Decision. Mr Ranchod should also note that any order for compensation to be paid in instalments would include a provision to the effect that a failure to pay an instalment would result in the total outstanding amount becoming immediately due and payable. If the Applicant wishes to respond to any submission Mr Ranchod may make in relation to paying compensation in instalments, she may do so by Monday 25 October 2021.

Conclusion

[148] In summary I find as follows:

a. I am not satisfied that an order for the payment of compensation would affect the viability of the Respondent’s business (s.392(2)(a)).

b. The length of the Applicant’s service favours the making of an order for compensation and no diminution of any amount that might otherwise be determined is warranted because of this circumstance (s.392(2)(b)).

c. The remuneration that the Applicant would have been likely to receive, but for her dismissal, is $27,068.65 in wages and superannuation contributions in the amount of $2,571.50.

d. I make no deduction for contingencies

e. I make no deduction on the basis of mitigation as I am satisfied that the Applicant has made reasonable attempts to mitigate the loss of her employment and provided a reasonable explanation for having not obtained employment at this point (s.392(2)(d)).

f. I make no deduction for remuneration earned since dismissal (s.392(2)(e)).

g. I make no deduction for income likely to be earned during the period between the making of the order and the actual compensation (s.392(2)(f)).

h. I make no deduction for payment in lieu of notice or redundancy payments made or owing to the Applicant and the Applicant is at liberty to seek to recover any amount of unpaid wages owing to her.

i. I make no deduction for misconduct (s.392(3)).

j. It is not necessary to cap the amount payable to the Applicant.

[149] I have taken into account all of the circumstances of the case and all of the matters I am required to take into account pursuant to subsections 392(2), (3) and (5). I am satisfied that it is appropriate to order that the Respondent pay the Applicant compensation in the amount of $27,068.65 less tax according to law and superannuation contributions of $2,571.50 to the Applicant’s nominated superannuation fund. If the Respondent wishes to make an application to pay the amount of compensation in instalments, having regard to the matters set out above, it should make such an application by 4.00 pm on Monday 18 October 2021. The Applicant may provide a response to such application by 4.00 pm on Monday 25 October 2021. If no application to pay the amount of compensation in instalments is made by the Respondent, an Order will issue requiring that the full amount is paid within 28 days of the date of release of this Decision.

DEPUTY PRESIDENT

Appearances:

The Applicant on her own behalf.

Mr L Ranchod for the Respondent.

Hearing details:

26 May.

2021.

Brisbane.

Printed by authority of the Commonwealth Government Printer

<PR734706>

1 Exhibit A3 Updated Witness Statement of Maria Ranchod.

2 Exhibit A1 – Statement of Emmanuel Castrisos dated 11 May 2021.

3 Exhibit A2 – Statement of Ms Leona Cooke dated 11 May 2021.

4 Exhibit R1 – Witness Statement of Lee Ranchod dated 6 May.

5 Ulan Coal Mines Limited v Honeysett and Others [2010] FWAFB 7578.

6 Technical and Further Education Commission T/A TAFE NSW v Pykett [2014] FWCFB 714 at [36].

7 Ulan Coal Mines Ltd v Howarth [2010] FWAFB 3488.

8 Ibid at [19].

9 Johnston v Blue Circle Southern Cement Pty Ltd [2010] FWA 5149 at [44].

10 Margolina v Jenny Craig Weightloss Centres Pty Ltd [2011] FWA 5215 at [6].

11 Technical and Further Education Commission T/A TAFE NSW v Pykett [2014] FWCFB 714 at [22].

12 [2014] FWCFB 714.

13 Ibid at [23].

14 Ibid at [24] – [25] and see Ulan Coal Mines Pty Ltd v Honeysett and Others [2010] FWAFB 7578.

15 [2014] FWCFB 714 at [36].

16 Ulan Coal Mines Pty Ltd v Honeysett and Others [2010] FWAFB 7578 at [34].

17 MacLeod v Alcyone Resources Ltd T/A Alcyone [2014] FWCFB 1542 at [32].

18 Maswan v Escada Textilvertrieb (t/as ESCADA) [2011] FWA 4239 at [39].

19 UES (Int’l) Pty Ltd v Harvey (2012) 215 IR.

20 Witness Statement of Maria Ranchod at page 1-2.

21 Transcript at PN293.

22 Exhibit A5.

23 Transcript PN594.

 24   Transcript PN704.

25 Transcript at PN702- PN703.

26 Exhibit R2 – Applicant’s contract of employment.

27 Transcript at PN131.

28 Transcript at PN120- PN121.

29 Transcript at PN123- PN130.

30 Transcript at PN60- PN61.

31 Transcript at 376.

32 Exhibit R1 Statement of Lee Ranchod.

33 Transcript at PN58 - PN59.

34 Transcript at PN164.

35 Transcript at PN97.

36 Transcript at PN99- PN108.

37 Transcript at PN145- PN146.

38 Transcript at PN153- PN 154.

39 Transcript PN158.

40 Exhibit A6 Contract of Employment of Lee Ranchod

41 Transcript PN659.

42 Transcript at PN361- PN363.

43 Transcript at PN368- PN369.

44 Transcript PN367.

45 Transcript at PN370-PN371.

⁴⁶ Piyush Jain v Infosys Limited T/A Infosys Technologies Limited [2014] FWCFB 5595.

 47   (1998) 88 IR 21.

 48   [2013] FWCFB 431.

 49   [2014] FWCFB 8683.

 50   [2015] FWCFB 2267.

 51   (1998) 88 IR 21.

 52   Tabro Meat Pty Ltd v Heffernan [2011] FWAFB 1080; Read v Golden Square Child Care Centre [2013] FWCFB 762; Bowden v Ottrey Homes Cobram [2013] FWCFB 431.

 53   Double N Equipment Hire Pty Ltd v Humphries [2016] FWCFB 7206 at [16]-[17]

 54   Transcript at PN835-PN836.