[2010] FWA 8462

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FAIR WORK AUSTRALIA

DECISION

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

Mr John Robert Dean
v
Sybecca Pty Ltd T/A Sleepy Lagoon Hotel
(U2010/7072)

SENIOR DEPUTY PRESIDENT RICHARDS

BRISBANE, 4 NOVEMBER 2010

Summary: termination of employment - performance issues - business size and HR resources do not excuse procedural fairness deficiencies in all cases - should accommodation and utilities be included in compensation - notional value.

[1] On 4 March 2010, the employment of Mr John Robert Dean (“the Applicant”) was terminated by his employer, Sybecca Pty Ltd t/a Sleepy Lagoon Hotel (“the Respondent”). The Respondent was represented at the hearing by Counsel, instructed by Aitken Legal. Mr Symon Duggan, who, along with his wife, is a Director and shareholder of Sybecca Pty Ltd was the Applicant’s direct manager. The Applicant was represented at the hearing by Mr Fuhrman-Luck and Mr Carroll.

[2] The Applicant has made an application under s.394 of the Fair Work Act 2009 (“the Act”) seeking relief in relation to his dismissal by Mr Duggan.

[3] The Applicant states that he had served as a casual bar attendant at the Sleepy Lagoon Hotel since January 2001, until his promotion to Duty Manager in February 2009. 1

[4] The Applicant was further promoted in August 2009 to the position of Head Hotel Manager. 2

[5] In December 2009 the Hotel was taken over the by the Respondent and the new owner, for current purposes, was Mr Symon Duggan. For purposes of his entitlements, the Applicant was taken to be continuously employed and his prior service was recognised. No issue of jurisdiction is taken to arise in respect of the minimum period of employment served by the Applicant. 3

[6] The Applicant was a Responsible Manager of a Licensed Venue (“RMLV”) and Gaming Licence Holder (“GLH”) for the Hotel. 4 He had completed a two-day course in April 2009 in relation to his management responsibilities and the regulatory requirements.

[7] As an RMLV and GLH for the Hotel the Applicant was not permitted to gamble on poker machines (at that venue) and never did gamble on poker machines at the Hotel. 5

[8] The Applicant held the GLH for 4 years and had also held a Security Licence for 2 years, having met the necessary Police checks. 6

BACKGROUND

[9] At a general level, the Respondent contends that the Applicant was dismissed from his employment for reason that he was unable to adapt to the new owner’s more rigorous expectations about the effort and leadership required of the Hotel Manager in building the venue’s image in the community. The Applicant contends that he was unfairly dismissed, there were no reasonable grounds for his dismissal and the Respondent had accorded him no procedural fairness.

[10] The relationship between the Applicant and the Mr Duggan had come under some stress most evidently from January 2010.

[11] On or about January 2010 the Applicant made a request of the new owner, Mr Duggan, to review his hours as he was working between 70-80 hours per week and sought an opportunity for same regularised contact with his family. 7

[12] Mr Duggan, for his part, rejected claims by the Applicant of long working hours. Mr Duggan contended that the Applicant's hours were far from onerous or unusual, and the Applicant was never required to be on-call (bar arguably in the week Mr Duggan was on leave and on the “odd occasion” otherwise). Mr Duggan generally argued that the Applicant had Monday and Tuesday off and did not recall the Applicant wanting to change his mode of employment. 8

[13] The Applicant went on to contend that shortly after the conversation of January 2010, he was informed by other staff 9 employed by the Respondent that Mr Duggan and his wife (Rebecca Duggan) had questioned them about their knowledge of the Applicant’s conduct in relation to selling illicit drugs and stealing.10

[14] Mr Duggan strenuously denied seeking to elicit such information. 11

[15] Mr Duggan did concede, though, that he made a discreet Police check about the Applicant (which he said gave rise to no issues of concern). 12

[16] While these circumstances might illuminate the tension in the wider relationship between the parties, no allegation was made by the Respondent in these proceedings that the Applicant had misconducted himself in any way.

[17] On 4 March 2010, the Applicant states that he was visited outside of working hours by Mr Duggan who is said to have declared that “It’s not working out” and “The Responsible Manager’s Sign -In Book was not filled out correctly and the roster was not done”. 13

[18] A discussion of the more detailed claims made by the parties follows. I have indicated various findings on the way on the basis of the discussion of the evidence, which falls within discrete categories.

ROSTER ISSUE

[19] One issue which Mr Duggan had claimed was a source of his lack of confidence in the Applicant's capacities as a manager was his alleged failure to provide adequate coverage for the Hotel when asked to assume a roster responsibility in late February 2010.

[20] Mr Duggan was absent from the Hotel for a period in late February 2010 and assigned the Applicant the task of completing the roster for the coming week. Mr Duggan returned to find (as I will explain below) that the roster had not provided sufficient coverage for the Hotel.

[21] The Applicant stated that he had completed the roster and it was awaiting his (Mr Duggan’s) approval. 14

[22] It seems that the roster issue arose from an observation by Mr Duggan that the Applicant had not drawn up a complete roster to cover a period in which Mr Duggan was absent (21\22 February 2010 - 1 March 2010). 15

[23] Mr Duggan contended that the Applicant was directed to do this prior to his (Mr Duggan’s departure) but had failed to provide adequate coverage of the bottle shop and the Bar at various times. The Applicant made no attempt, it was alleged, to contact Mr Duggan in the event of any issues arising about the roster. 16

[24] The Applicant's position was that the roster had been completed but was not able to be printed off owing to Mr Duggan’s failure to provide the appropriate printing facilities. In any event, the Applicant claimed that he had informed all relevant staff of their roster duties by verbal communication and the fact that one staff member (Ms Tracey Ford) did not turn up to work was no fault of his (and was only made known to him after his dismissal had taken effect). 17

[25] Mr Duggan dismissed this latter claim and contended that the pay records revealed that Ms Ford, who said by the Applicant to have been rostered for bar duties, was not rostered to work at the relevant time or on the relevant day. 18

[26] I can discern no evidence that the Applicant failed to fulfil his principal responsibility to prepare the roster and to ensure that staff were alerted as to their roster obligations. The Applicant's evidence in these regards was not seriously challenged. 19

[27] It appears that one individual who was altered to their roster arrangements did not attend for her shifts and this was not an issue of the Applicant's making. Given that he was not rostered on at the time that it became known to Mr Duggan that the bar and bottle shop shifts were unlikely to be covered, it is asking quite a deal for the Applicant to be held accountable for that the conduct of the particular staff member.

[28] The Applicant did not publish the roster as is the practice. There is some suggestion that this might have contributed to the failure to effect adequate coverage. The Applicant's explanation that the roster could not be displayed because of the printing facility was unavailable does not explain why he could not have published a hand written version of the roster. Indeed, he accepted that he could have posted the roster if he had taken the initiative to write it out. 20 But in the end, little substance turns on this.

[29] I should point out that the Applicant's evidence in relation to the extent to which he had followed through with the rostering task was not without confusion. While the Applicant made some effort to contend that the roster was not published owing to Mr Duggan’s failure to officially approve the roster he had completed, and which he had left on the computer for him to review, the Applicant nonetheless contended that he had completed the rostering task by informing each affected staff member directly. That is, on one hand the Applicant sought to defend a deficiency in his conduct by shifting responsibility to Mr Duggan for not approving the roster he had completed and left on the computer, but on the other hand maintained he had completed the task as directed and for which he was entirely responsible. 21

[30] On the first scenario, it would appear that the Applicant had never intended to display the roster at all as it was unapproved. On the second scenario, he had done all that he could practically do to fulfil his employer’s direction, which he had accepted.

[31] The Applicant's evidence did not reflect well on his willingness to be frank in his account of his conduct in relation to his employer’s directions.

FAILURE TO REPORT INCIDENT IN THE INCIDENT REPORT LOG

[32] It was also alleged by Mr Duggan that there had been a physical altercation near the venue on 26 February 2010 for which the Applicant had logged no incident report. Mr Duggan was of the view that regardless of whether the incident was on or off the Hotel’s grounds, if it involved one or more patrons it should be recorded. 22

[33] To this the Applicant replied that there had been no fighting at the Hotel but an incident had occurred across the road. The Applicant further claimed he had queried a participant in the incident but was informed there had been no fight, though a third party had indicated to him that there had been a physical altercation. The Applicant also had knowledge that one of the participants had been in the Hotel’s beer garden prior to the incident. The Applicant agreed that he did not record the incident for reason that he did not consider it relevant to the Hotel’s reputation or that is formed a part of any regulatory obligation (which he believed only extended only to incidents which occurred on the Hotel’s premises). 23

[34] Mr Duggan contended that as he had made it clear to the Applicant in various conversations in the period from December 2009 to February 2010 that he was concerned with the Hotel’s reputation and wished to improve it, that such incidents should be reported as a matter of common sense.

[35] The Applicant accepted that Mr Duggan had explained to him that as the new owner he was seeking to improve the Hotel’s image and improve its reputation. 24 The Applicant also accepted that Mr Duggan had high expectations of his managers.25

[36] It appears to me that there is no clear regulatory obligation to report an incident that occurs off the Hotel’s premises. But what the conflict between the parties is illustrative of is the disjunct that had emerged between Mr Duggan and the Applicant since December 2009 as to the kind expectations and practices the Hotel management should evince.

[37] Given the general directions for the Hotel articulated by Mr Duggan, it might have been reasonably expected that the Applicant would have reported the incident. The fact that he investigated the incident but made no record of the matter reveals the extent to which he had not developed any sensitivity to his employer’s expectations about the Hotel’s managers’ roles and his expectations about its public image.

[38] I add further that the Applicant himself agreed in cross examination that it would make sense to identify participants in altercations (where they had emanated from the Hotel and the incident had occurred across the road) so they could be tracked (as are other persons) to ensure they did not interfere with the public’s passage past the Hotel and so forth (which are matters that could bear on the regulatory obligations of the licensee). The Applicant agreed that there had been a close connection between the incident and the Hotel. 26

APPROVED MANAGER’S REGISTER

[39] A further allegation was that the Approved Manager’s Register (“AMR”) was not filled out for a particular weekend. 27 The AMR, so Mr Duggan claimed, must be recorded at all times as the Hotel cannot operate unless an appropriately approved manager has signed the AMR at the beginning and end of each shift. Mr Duggan claimed that AMR was not signed for the period 24 February 2010 - 28 February 2010.28

[40] More specifically, it was alleged that Mr Duggan had returned from his leave on 1 March and observed that the Applicant had not signed in and off as the Approved Manager at the completion of each of his prior shifts (between 24 February 2010 and 28 February 2010) as was the expectation.

[41] The Applicant claims this allegation had no substance as he had remained signed in for the entirety of the hours of business and that he had been available on an on-call arrangement during the week of Mr Duggan’s absence. 29 The Applicant also denied that he had any regulatory obligation to sign on and on at the start and finish of each shift and that it was appropriate that he sign of the AMR in the manner he had done.30

[42] Section 155AE of the Liquor Act 1992 (Qld), however, obligates an approved manager to sign on and off on each discrete shift on the Approved Manager’s Register. The Applicant purported to have knowledge of the regulatory requirements relating to his position as an approved manager. This knowledge arose from his two-day training course in February 2009, to which reference was made above.

[43] In this particular regard, however, his purported knowledge was significantly deficient, while Mr Duggan’s expectation about “industry standards” in relation to signing on and off after each shift was closer by far to the legal obligations imposed on approved managers and licence holders.

FOOTBALL TIPPING COMPETITION

[44] The Respondent alleged that the “Footy Tipping Competition” had not had a successful take up and that this had been a source of conflict with the Applicant. The Applicant claimed that while the issue had been a point of discussion, and that he had been directed to implement a football tipping competition as a means of generating additional Hotel revenue, the Respondent had never come back to him with any proposal as to preferred manner of operating the competition and he had never completed the task. 31 In any event, the Applicant claimed, he did not have the time to complete the task.32

[45] Mr Duggan claimed that it was the Applicant's express responsibility to undertake the promotions campaign and he had simply not fulfilled that responsibility. 33

[46] As in relation to completion of the Incident Report, this matter also demonstrates the disjunct that had emerged between the Applicant and Mr Duggan over the few months of their direct relationship. The Applicant adopted a reactive approach to tasks, and Mr Duggan’s expected his manager to be instinctive, proactive and outcomes focused.

[47] The Applicant conceded that he could not complete the task as he was too busy, but he made no effort to convey his status of the task to Mr Duggan; he simply did not do it despite the football season being about to start. Mr Duggan, for his part, merely expected the task to be followed through with once he had directed it be completed, and without any further intervention or guidance from himself:

WARNINGS AND COUNSELLINGS

[48] The Applicant claims that he was never counselled or warned or spoken to by the Respondent about any aspect of the performance of his duties or his conduct. 35 Specially, the Applicant claimed that the Respondent’s statement that he had been spoken to by Mr Duggan on 3 March 2010 about various issues that Mr Duggan had recorded as discussion notes was incorrect. It was incorrect for reason, in the Applicant's view, Mr Duggan did not speak with him nor conducted any meeting on that date.36

[49] The Applicant claimed that the only meeting between Mr Duggan and himself was on 4 March 2010 when Mr Duggan attended his residence outside of hours and terminated his employment, as set out above. 37 The Applicant claimed this was a brief meeting as set out earlier. Mr Duggan claims, to the contrary, that he discussed the matters as outlined in his notes, which dealt with a range of the issue touched on above. His evidence concedes that the discussion was no more than between 5-7 minutes in duration.38 The Applicant stated the discussion went for no more than two minutes (as Mr Duggan’s estimate includes the time he waited for the Applicant to arise from bed).39

[50] Mr Duggan further conceded that he had made up his mind to terminate the Applicant's employment before the discussion on 4 March 2010. 40

[51] Mr Duggan’s evidence was that he had “conducted two formal meetings” with the Applicant formally about his position (one on 8 December 2009 and the second at the end of February 2010). These meetings, according to Mr Duggan, concerned the direction of the Hotel and the manner in which he expected his managers to perform their duties so that they accorded with this direction. Mr Duggan claimed the Applicant “stuck his head in the sand” about his approach to his role. 41

[52] Mr Duggan buttressed his view in this regard by reference to the Incident Report Book. The references he made in this regard were to three incidents, one in January 2010 and two in February 2010. The first incident concerned late opening and service. The second concerned lack of support during the bar shift. And the third concerned the inability to locate the Applicant. 42

[53] Mr Duggan’s conceded that the occasions on which he spoke to the Applicant (as referred to earlier) were not performance meetings. But they were occasions in which the business direction was communicated to the Applicant and that he was encouraged to support that direction. At a broad level, this new direction, as it was said to be, required managers to be active in the workplace and interact with patrons and demonstrate leadership to staff. 43

[54] Whilst Mr Duggan conceded he did not performance manage the Applicant, he claimed that he recalled “chipping” the Applicant “often” about not being active in front of staff when he was just “standing around” or leaning on a pallet and not exhibiting a suitable work ethic (“the pallet incident”). 44 The Applicant, for his part, contended that the incident Mr Duggan referred to in relation to leaning on a pallet was an exaggeration of the actual circumstances and revealed Mr Duggan’s intemperate nature.45 Mr Duggan conceded that he spoke in strong terms to the Applicant on this occasion and used expletives that were directed at the Applicant personally. A third party (from outside the Hotel) was also present at that time.46

[55] Other than that, Mr Duggan claimed that there was common interaction with managers and staff about his expectations and that “my performance expectations were for hard working, diligent employees” and that “I would have been very clear to” the Applicant “that I was not happy with his performance”. 47 Mr Duggan claimed that staff knew widely that the Applicant's performance was under review, and it was reasonable to assume the Applicant was similarly aware of his circumstances.48

[56] It does not appear that Mr Duggan expressly warned the Applicant at any time about his performance as a manger or else provided the Applicant with any opportunity to improve his performance. There is no evidence that Mr Duggan at any time was aware by express indication from Mr Duggan that his employment was in jeopardy.

[57] It would be naive, however, not to infer reasonably from the evidence that the Applicant could have assumed that his relationship with Mr Duggan as his employer was on a sound and secure basis. Mr Duggan had imposed new performance expectations on his managers (and one had already resigned). Mr Duggan had also conveyed to the Applicant an altogether unpleasant description of his (the Applicant’s) managerial approach (as set out above in respect of the pallet incident).

TAB BETTING

[58] It was also claimed by the Respondent that the Applicant had placed bets on the TAB whilst performing his duties, when it had been made clear by Mr Duggan that gambling on the TAB whilst on duty was not permissible. 49

[59] The information about the Applicant's conduct only came to light after the Applicant had lodged his application under s.394 of the Act. 50 Mr Duggan contended this was inappropriate conduct in relation to the Applicant’s training and\or did not accord with the Respondent’s expectations of its Manager. Mr Duggan, however, did not produce any witnesses in support of this allegation.51 Mr Duggan did contend that if he had ever accepted any bets on behalf of the Applicant it could only have been when the Applicant was not performing duties.52

[60] The Applicant stated that the previous owner had permitted staff placing bets on the TAB and the new owner had not made any mention of the issue, and had himself taken bets from the Applicant when operating the TAB terminal. 53 The Applicant further claims no change in Hotel policy was introduced by Mr Duggan in relation to betting on the TAB.54

[61] While this issue entered the evidence through Mr Duggan’s witness statement, it was not relied upon for purposes of validating the dismissal and no direct allegation was made.

[62] Mr Duggan also claimed that upon the departure of the Applicant other information about the Applicant's performance as manager have come to light which fortify his (Mr Duggan’s) claims about his conduct. This is particularly so in relation to information allegedly provided by staff that the Applicant had been seen not only to gamble on the TAB (which has been discussed above) but also on the pokies.

[63] It was also alleged that the Applicant had consumed alcohol whilst performing his duties as Manager. 55 Mr Duggan, however, brought no evidence to support these wider claims, just as he did not evidence his claims in relation to staff knowledge of the Applicant's gambling practices. As a consequence, I give no weight to Mr Duggan’s claims and reject any insinuation as to the Applicant's conduct.

PAYMENT FOR ROOMS LET

[64] The Respondent claimed that the on at least 3 occasions rooms were stayed in but no monies were found for payment nor any record thereof. 56 The Applicant replied that some guests who made telephone bookings (and were not required to make deposits) were “no shows”. The bookings system might therefore record a stay but there would be no record of payment. He also claimed that he recalled an instance in which EFTPOS payments were sometimes not recorded on the computer system or not receipted, and that it took him some lengthy period of time to resolve the matter.57

[65] The Applicant for his part contended that a cross reference to the cleaning record could authenticate the use of the hotel room, however. 58

[66] But the issue was not so simply explained. Ms Duggan contended that on some occasions cleaning staff would be required to “re-clean” rooms that had been previously recorded as having been cleaned. It was suspected that someone had stayed in the rooms but no record of the stay or of a payment had been in evidence. 59

[67] Ms Duggan contended that whilst she had no evidence that the Applicant was responsible for the issues in relation to the rooms, the matter ceased to be of relevance upon the Applicant's departure. 60

[68] As with some other features of the Applicant's evidence, the material set out immediately above was of no relevance for purposes of the dismissal: it was not relied upon at the time as a reason for the dismissal and did not form the basis of an allegation. I accord it no weight.

CONSIDERATION

[69] For purposes of determining whether a dismissal was harsh, unjust or unreasonable, the Act requires that various statutory-expressed concerns be taken into account. In this regard s.387 of the FW Act reads as follows:

s.387(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)

[70] Taken on their own, a number of the issues on which the employment relationship foundered in this matter would ordinarily not establish a basis for a finding that the Respondent had a valid reason for the termination of the Applicant's employment.

[71] The failure to provide adequate roster coverage cannot on the evidence in these proceedings provide the basis for a determination that the Respondent had a valid reason for the dismissal. I have accepted the Applicant's claim, though it was not always pressed in a manner that sat comfortably with his wider claims, that he acted to provide for roster coverage for the requisite period. The alleged failure to provide coverage only arose because of the conduct of a staff member over whom he had no influence at the time (and who did not attend for work for reasons unknown).

[72] Further, a single occasion on which a manager fails to complete an incident report in relation to an altercation that occurs off-site (and where the manager had nonetheless investigated the incident) might not be cause for severing the employment relationship. Though I add that given the Respondent's concerns for improving the image of the Hotel, which had been conveyed to the Applicant, he might reasonably have acted to record the relevant incident or convey the circumstances to Mr Duggan. Not to have done so revealed an insensitivity to his employer’s business objectives.

[73] Additionally, a failure to implement the Football Tipping competition as directed (or otherwise manage the circumstances as to why he could not complete the task before it became an issue in the employment relationship) might not be destructive of the employment relationship in its own right. Yet here it must be concluded that the Applicant simply did not fulfil a reasonable direction and took no initiative to manage his inability to perform carry out that direction.

[74] The Applicant’s failure to meet his regulatory obligation to complete the AMR in a manner that must have been consistent with his training and his purported knowledge was a significant misjudgement. His conduct placed him at risk of penalty under the Liquor Act, as it did also the Licensee (which as a corporation would have potentially faced a substantial financial penalty). However, as a first offence, it would be unlikely that the breach, if reported and identified, would have yielded a maximum penalty.

[75] I very much doubt that on its own that the manner of the Applicant's completion of the AMR in its own right would found a valid reason for the termination of his employment, an important issue though it be. I note that the Respondent’s own knowledge of the Liquor Act was less than perfect in these regards and that the extracts of the AMR that I have cited demonstrate some variable practices over time by approved managers.

[76] Even when put in a cumulative context, I cannot discern a valid reason for the Applicant's dismissal. There are aspects of the Applicant's performance of his duties that I will comment upon below, but for purposes of a finding of a valid reason for the dismissal, I cannot conclude that the case has been made out or is otherwise discernible in the evidence.

s.387(b) Whether the person was notified of that reason

[77] The Applicant was informed of a number of reasons for the termination of his employment at the time he was informed that his employment was terminated. There is some contest as to whether every reason was given.

[78] It is enough to find that the Applicant was reasonably apprised of most of the substantive reasons by Mr Duggan on 4 March 2010 as to why his employment was being terminated, though I concede there might have been some measure of deficiency in further particularisation.

[79] That said, the Applicant was given notice of the reasons at the time his employment was terminated. He was not given notice of the reasons in advance of his employer’s decision to terminate his employment.

s.387(c) Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person

[80] In light of the above, the Applicant was provided no opportunity practically to respond to the reasons for the termination of his employment. Mr Duggan conceded that he had already decided to terminate the Applicant's employment before such time as he met the Applicant on 4 March 2010 and therefore the capacity for the Applicant to influence Mr Duggan’s decision making effectively was non-existent.

s.387 (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

[81] Given the above circumstances, this matter does not assume any practical relevance for purposes of the consideration before me. There were no discussions relating to the dismissal for which the attendance of a support person was a conceivable option.

s.387 (e) If the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal

[82] It appears to me that Mr Duggan contends that the Applicant should have known what was expected of him and in what ways his current performances had been deficient. The Applicant should have been aware of this from the passing iterations about the Hotel’s goals and directions and the passing admonishments and behavioural cues that Mr Duggan claimed to have formed part of the workplace relationships since he took the business over.

[83] This is not without some substance, but only so far as it goes. It is naive to believe on the evidence that the Applicant was unaware of any expectations being placed upon him to do things differently or to express a more active work ethic. At the very least, the Applicant must have been uncomfortable by Mr Duggan’s oversight of his functions. 61

[84] But there is no evidence that the Applicant was informed expressly that these prompts and guides were warnings that his employment was in jeopardy because of deficiencies in the performance of his duties. And as a consequence, the Applicant was not able in any formal sense to improve upon his performance or act to restore Mr Duggan’s confidence in him in some defined areas.

[85] Further, it appears that Mr Duggan’s method of communicating with the Applicant was not conducive rich exchanges regarding process and procedure. Mr Duggan was inclined to give a direction and thereafter expected to see the outcome. There was little engagement in between.

s.387(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

[86] The Respondent's business is a small business (though not one within the meaning of s.23 of the Act) and operated at a personal and informal level. There is a very strong likelihood the size of the Respondent's business impacted on the procedures followed in effecting the dismissal. It was put to me in evidence that the Respondent employed a total of some 16 persons in two Hotels (many of which were casual employees) and the issues of hiring and firing were left to Mr Duggan himself, whose duties as a Director extended to all operational, financial, marketing and other features of the business(es).

[87] I was invited to excuse, in effect, the lack of regard to process on Mr Duggan’s part because of these circumstances, or perhaps at least to not afford deficiencies in procedural matters significant weight.

s.387(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

[88] As a smaller business located in Tin Can Bay, the Respondent did not have access directly or immediately to any dedicated human resource management specialists or expertise. This was an uncontested feature of Mr Duggan’s evidence. It appears to me that these circumstances would be likely to have impacted on the procedures followed in effecting the dismissal of the Applicant, which have been set out above at various places. I was invited in this regard to consider these circumstances as mitigating any imperfection in procedural matters.

s.387(h) Any other matters that FWA considers relevant

[89] As with most employees who are dismissed from their employment, the Applicant has been negatively affected by the circumstances that have come to pass. This has been exacerbated, on the Applicant's witness statement, by the loss of his family’s accommodation, which was a condition of his employment.

[90] The Respondent's Hotel was also the only hotel in the Tin Can Bay. The market for the Applicant’s skills in the area is limited.

[91] However, the Applicant made it clear under cross examination that his family had moved to Brisbane before such time as he was dismissed, and for unrelated reasons. On the Applicant's evidence under cross examination it appears that he was living alone in the Hotel’s house since January 2010 (well before the termination of his employment on 4 March 2010).

[92] It also appears from the cross examination, that given his familial circumstances, the Applicant was uncertain of the extent of his tenure with the Respondent, though he gave no indication, he said, of immediately vacating his position. The Applicant is currently domiciled with his family in Brisbane. 62 This is not a matter that has attracted any weight for the purposes of the current consideration.

[93] I note, finally, that the Applicant has provided services to the business since 2001, albeit on a casual basis for some period of time, had become a permanent employee in February 2009, had been employed by the Respondent for some three months at the time of his dismissal.

[94] I have also discerned through the evidence that the relationship between the Applicant and Mr Duggan was in the process of becoming dysfunctional. The Applicant lacked the dynamism and initiative Mr Duggan expected of his managers. The implication of this relationship conflict will be worked through further below.

CONCLUSION

[95] While I acknowledge that the Respondent’s business is not a large business and that it has no human resource expertise, the deficiencies in extending procedural fairness to the Applicant were particularly serious. This is the case because in the circumstances where performance based issues are largely front and centre, it was possible that the Applicant could have influenced the outcome of the Respondent’s decision making if he had had an opportunity to do so.

[96] I do not construe s.387(f) and s.387(g) of the Act to mean that a smaller business (not being a small business for purposes of s.23 of the Act) is exempt from affording procedural fairness to an employee that it dismisses. Rather, s.387(f) and s.387(g) of the Act require the tribunal to consider the circumstances as they are in the particular case, and to give weight accordingly.

[97] What are the relevant circumstances of this case?

[98] This is not a case in which the resources required to extend procedural fairness or otherwise to performance manage the relevant employee were reasonably beyond the reach of the employer, because of the employer’s size. All that was required was for Mr Duggan to communicate more openly with the Applicant about his particular concerns and to provide a window of opportunity to improve. To have given effect to this requires only a very modest suite of personal skills. It does not require or necessitate the availability of Human Resources specialists.

[99] Nor were the issues in contention of such complexity that they required an investigation or investigatory tools that a smaller, less resourced employer would not reasonably have available, or be expected to invest in. The issues were all capable of exploration and discussion in a localised context and without any third parties or excess of resources.

[100] I also doubt that this was not a case in which the continuation of performance in the manner set out above would have caused an immediate commercial or regulatory risk to the Respondent that could not have been managed for reason of its size. The size of a business may well affect its capacity to mange a risk that is well made out. But in the current case the immediate risks to the employer on any front that I can consider cannot be said to have been so imminent as to excuse procedural fairness altogether.

[101] There may be circumstances (some of which only have I canvassed immediately above) in which a smaller business, to which s.387(f) and s.387(g) of the Act are relevant, might be found to have been reasonably unable to afford (in one way or another) the requisite measure of procedural fairness in managing the dismissal of an employee. But the circumstances before me do not warrant such a conclusion.

[102] That said, upon considering all the circumstances of this matter, I am satisfied that the termination of the Applicant's employment was harsh, unjust or unreasonable.

REMEDY—COMPENSATION

[103] The Applicant in this matter expressly seeks not to be reinstated. It would be inappropriate to consider that by reinstating an employee who seeks not to be reinstated that a cooperative and harmonious employment relationship could be reasonably expected to emerge.

[104] For that reason I will consider the role of compensation in this matter.

[105] Section 392 of the Act reads as follows:

[106] It was a matter of evidence in these proceedings that the Respondent predicted it would not make a pre or post tax profit in this financial year. This was because of the costs associated with the purchase and expansion of the Hotel and other costs including the costs incurred in these proceedings.

[107] An order for compensation at the higher end might not affect the business’ actual viability (that was not put to me) but it would be reasonably inferred that it would create a cash flow problem in the current financial year.

[108] It is for circumstances such as this that s.393 of the Act may be applicable.

[109] In all, while the business is a smaller business in a period of initial change which has required some investment, and is not near profitability at this point, the evidence does not suggest that any order might create a risk to the viability of the business.

[110] I have previously noted the Applicant's employment history including with the employer at the time of the dismissal.

[111] This matter requires some unavoidable measure of speculative judgment on the part of the Member concerned. As best as I can base such a judgment on the evidence before me, I do not consider that the Applicant would have remained in the employment with the Respondent for a particularly long period.

[112] It appears to me having heard the extensive witness evidence that the Applicant and Mr Duggan are fundamentally incompatible personality types and there is no surprise to me that they fell into conflict at an early stage in their relationship (beginning in January 2010) over issues of discretionary effort, work effort, initiative and accountability. Indeed, these were the defining themes in their relationship between January and March 2010.

[113] The evidence revealed these thematic tensions in the employment relationship which were likely to become intensified over time.

[114] One example of this concerned the Respondent's stated goal to improve the Hotel’s reputation in the public’s eye. The Applicant was left with no doubt at all that Mr Duggan sought to improve the public image of the Hotel. But when an altercation occurred, when the Applicant was the approved manager on duty, at night across the road from the Hotel, and which involved persons emanating from the Hotel’s Beer Garden, the Applicant made no mention of it to Mr Duggan. As I said above, this was indicative of the Applicant's lack of sensitivity to the business priorities of the new owner, which were abundantly clear:

[115] Further, the Applicant could see no point to Mr Duggan’s concern that he had failed to take the steps to introduce a football tipping competition before the NRL season started as a marketing tool for the Hotel. The Applicant simply stated that he did not have time to do it. Even if that was the case, given the new environment in which he was working and the imminent commencement of the NRL season. It would appear reasonable for him to have least managed the situation in some way. But he did nothing. And he acted in this way in circumstances in which he admitted that Mr Duggan had high expectations of his managers and he acknowledged that the task had been left to him to execute.

[116] Similarly, the Applicant sought to contest with his employer whether Mr Duggan had acted to approve the roster whilst he contended at the same time he had had responsibility for the generation and publication of the same roster. The tension in the Applicant's evidence (which I cited above) suggested to me that he was inclined to test issues of procedure with Mr Duggan, despite what he knew was the appropriate course of action. This was an example of the deterioration in the relationship between the Applicant and Mr Duggan (of which Mr Duggan’s own behaviour - exemplified in the pallet incident above - was also a contributing factor I add).

[117] I also add that the Applicant had some measure of uncertainty (albeit it undefined) about the continuation of his employment tenure given his familial circumstances. 64 This is a relevant consideration, along with the other matters.

[118] As best as I can judge, I would have expected the Applicant’s employment to have endured for no more than a further 6 weeks, before for one reason or another, the relationship would have ceased.

[119] The Applicant has made efforts to mitigate his losses and has earned $6,000 in income since the termination of his employment. The Respondent did not cavil with the Applicant's efforts in relation to mitigation as he said they were. 65

[120] The Applicant earned an amount of $6000.00 gross following the termination of his employment. 66 He was provided with two week’s notice in lieu (after agitating for such payment). The payment provided in lieu of notice is taken to be $2,000.00.67

[121] There is no evidence before me in this regard to which I can have reasonable regard, and in any event, for the reasons that follow, it is not a relevant consideration.

[122] There are no other issues to which I can have reasonable consideration.

[123] I inquired on the Respondent whether any submission was to be made under s.392(3) of the Act, which reads as follows:

[124] The Respondent sought to make no submissions in this regard.

[125] Section 392(4) of the Act reads:

[126] The order that I will make will not have regard to the matters proscribed in s.392(4) of the Act, though to some measure they were suggested in the Applicant's materials as being matters to which I should have regard.

[127] Section 392(5) of the Act reads as follows:

[128] Ultimately, these are not matters to which I need to have regard. This is because I have found above that the Applicant in all likelihood would have remained in the Respondent’s employment for no more than a further 6 weeks.

[129] On the basis that the Applicant earned $1000.00 per week gross I would, subject to earnings which must be deducted, otherwise make an order that the Respondent pay the Applicant 6 weeks’ salary.

[130] This amounts indicatively to $6,000.00 (gross, subject to the usual taxation).

[131] From this I am required to deduct the income the Applicant had earned. I am not required to deduct the total income earned for the period from the compensation I have ordered. Rather, I am required to deduct the income earned by the Applicant in the period of time for which the Applicant's employment would have continued but for the dismissal. That is, I am required to deduct the income earned by the Applicant in the 6 week period immediately following the termination of his employment.

[132] I put this amount at $2000.00 (or two week’s salary) as this is the amount that was paid to the Applicant in lieu of notice. That is, the Applicant cannot be compensated for the period of notice for which he has been paid by the Respondent..

[133] I will not deduct any other earnings since the dismissal. I rely on the Applicant's uncontested evidence that he did not commence earning other income until 22 May 2010, which is a period of time in excess of 6 weeks following the termination. 68

[134] I note further in this matter that I was asked by the Applicant's representatives to include within the definition of compensation an imputed value for residential access to a house owned by the Hotel (and situated adjacent to the Hotel) and utilised by the Applicant over the course of his employment. This imputed amount was to also include an indicative amount for the payment of electricity. The total imputed amount sought to be included was between $275.00 and $300.00 per week (presumably as post tax income).

[135] The value of the facilities did not form an element of a total remuneration package (such as salary sacrifice) that could have been crystallised or realised as cash or salary in any alternative form.

[136] Indeed, in this case, there was no agreed value to be ascribed to the accommodation.

[137] A question arises as to whether such an arrangement would reasonably fall within the scope of meaning of remuneration for compensation purposes.

[138] It appears to me that where the employer simply agrees to provide access to the facilities and to do certain things which do not arise from an obligation given force by an employment contract, and no value has been ascribed to these arrangements, then the notional value of the facilities etc should not be taken into consideration for purposes of compensation.

[139] The reason for this is that the provision of the facilities etc could have been stopped at any time at the Respondent's discretion and without there being any breach of the employment contract itself, and the value of the access to the notional value of the facilities would not have been realisable in any circumstances (including after the employment relationship had ceased).

[140] In this sense, the Applicant would never in the post employment period have been said to have lost an entitlement he was otherwise owed.

[141] Consequently, in such a scenario this would not have been a benefit the notional value of which could have formed the basis for the calculation of remuneration for the purposes of compensation.

[142] The situation is different for purposes of the calculation remuneration the Applicant earned whilst in employment, which has been considered in the Full Bench in Appeal by Australian Liquor, Hospitality and Miscellaneous Workers Union [Q1629] (3 July 1998). 69 I note in this case that the Full Bench initially took a contrary view but was persuaded by the practice of the Commission (as it was then).70

[143] The circumstances in this case need to be considered closely.

[144] In cross examination the Applicant maintained his evidence that the provision of accommodation and payment for electricity was in consideration for his extra hours. The relevant exchange was as follows:

[145] Whilst the access to the facilities did not form part of a salary sacrifice arrangement or otherwise had any nominal, agreed value, they were benefits provided in kind for purposes working particular hours (perhaps unsociable hours or being on call after the Hotel had closed). That is, the provision of the facilities has the character of a consideration and therefore it can be reasonably inferred to have been a component of the contract of employment as informally derived.

[146] It appears to me, therefore, that the nominal value of the accommodation and utilities should be included as a component of the Applicant's remuneration.

[147] The notional value that I accord to the accommodation and facilities is $275.00 per week. This was the lower end of the estimation provided by the Applicant (through a Real Estate agency) and which was not contested. I have accepted the lower end rather than the higher end as the lower end has a measure of certainty about its relevance whereas the higher end is more speculative.

[148] In light of this reasoning, the Respondent is ordered to pay 4 weeks’ salary (subject to ordinary taxation) and an additional further amount equivalent to $1,100.00 net (to be grossed up as salary and then subject to ordinary taxation).

[149] Whether any matter arises from this discussion for the purposes of the amount that was paid in notice is a matter for the parties and does not bear on my current considerations.

[150] Given the financial circumstances of the Respondent, I will afford it a period of seven working days in which it may propose a reasonable schedule of payments in order to discharge the amount in compensation identified above. Section 393 of the Act reads in these regards as follows:

[151] To avoid doubt, an order by FWA under subsection 391(3) or 392(1) may permit the employer concerned to pay the amount required in instalments specified in the order.

[152] In the event that a reasonable schedule of instalment payments is provided, I will give effect to this schedule by way of an order.

[153] In the event no reasonable schedule of payments is put to me within the requisite time period, I will order that the Respondent make full payment to the Applicant in 14 working days from the date of this decision.

SENIOR DEPUTY PRESIDENT

Appearances:

Mr. J. Furhman-Luck instructed by Mr. A. Carroll for the Applicant

Mr. J. Merrell of Counsel instructed by Aitken Legal for the Respondent

Hearing details:

2010.
Noosa Magistrates Court:
October 27 and 28.

 1   Statement of Mr J Dean dated September 2010 at PNS 1 and 4

 2   Statement of Mr J Dean dated September 2010 at PN 6

 3   Statement of Mr S Duggan dated 28 September 2010 at PN 5

 4   Statement of Mr J Dean dated September 2010 at PN18

 5   Statement of Mr J Dean dated September 2010 at PNS 19-20

 6   Statement of Mr J Dean dated September 2010 at PNS 29

 7   Statement of Mr J Dean dated September 2010 at PN 21-22

 8   Statement of Mr S Duggan dated 28 September 2010 at PN 37; Transcript PNS 838 - 843

 9   Presumably this being Ms Leigh Parker (see Statutory Declaration of Ms L Parker dated 6 September 2010)

 10   Statement of Mr J Dean dated September 2010 at PNS 23-25

 11   Statement of Mr S Duggan dated 28 September 2010 at PN 36

 12   Statement of Mr S Duggan dated 28 September 2010 at PN 36

 13   Statement of Mr J Dean dated September 2010 at PNS 40-46

 14   Statement of Mr J Dean dated September 2010 at PNS 47 and 78

 15   Statement of Mr S Duggan dated 28 September 2010 at PN 19

 16   Statement of Mr S Duggan dated 28 September 2010 at PN 19

 17   Statutory Declaration of Mr J Dean filed 7 October 2010 at PNS 34-49

 18   Compare Statutory Declaration of Mr J Dean filed 7 October 2010 with Statement of Mr S Duggan dated 25 October 2010 at Attachments SD-4 and SD-5

 19   Transcript of Proceedings at PNS 460-467

 20   Transcript of Proceedings at PN 485

 21   Transcript of Proceedings at PNS 470-471, 472-473

 22   Statement of Mr S Duggan dated 28 September 2010 at PN 20

 23   Statement of Mr J Dean dated September 2010 at PNS 71-75

 24   Transcript of Proceedings at PNS 190, 250-254 and 273

 25   Transcript of Proceedings at PN 274

 26   Transcript of Proceedings at PNS 669-674, 677 and 689; Statement of Mr J Dean dated September 2010 at PNS 74-75

 27   Statement of Mr S Duggan dated 28 September 2010 at PN 23

 28   Statement of Mr S Duggan dated 28 September 2010 at PN23 and Attachment SD-2

 29   Statement of Mr J Dean dated September 2010 at PNS 87-88l Statutory Declaration of Mr J Dean filed 7 October 2010 at PNS 51-55

 30   Transcript of Proceedings at PNS 380-381

 31   Statement of Mr J Dean dated September 2010 at PNS 89-91

 32   Transcript of Proceedings at PN 719 - 724

 33   Statement of Mr S Duggan dated 28 September 2010 at PN 24

 34   Transcript of Proceedings at PN 1225

 35   Statement of Mr J Dean dated September 2010 at PN 33

 36   Statement of Mr J Dean dated September 2010 at PNS 92-93

 37   Statement of Mr J Dean dated September 2010 at PNS 40-46

 38   Statement of Mr S Duggan dated 28 September 2010 at PN 26

 39   Statutory Declaration of Mr J Dean filed 7 October 2010 at PN 57

 40   Statement of Mr S Duggan dated 28 September 2010 at PN 26

 41   Statement of Mr S Duggan dated 28 September 2010 at PN 16

 42   Statement of Mr S Duggan dated 28 September 2010 at PN 25 and Attachment SD-3

 43   Statement of Mr S Duggan dated 28 September 2010 at PN 17

 44   Statement of Mr S Duggan dated 28 September 2010 at PN 18

 45   Statutory Declaration of Mr J Dean filed 7 October 2010 at PNS 32-33

 46   Transcript of Proceedings PNS 969-977

 47   Statement of Mr S Duggan dated 28 September 2010 at PN 18

 48   Statement of Mr S Duggan dated 28 September 2010 at PNS 31 and 40

 49   Statement of Mr S Duggan dated 28 September 2010 at PN 33 and 34

 50   Statement of Mr S Duggan dated 28 September 2010 at PN 33

 51   Statement of Mr S Duggan dated 28 September 2010 at PN 33

 52   Statement of Mr S Duggan dated 28 September 2010 at PN 34

 53   Statement of Mr J Dean dated September 2010 at PNS 16 and 97-101, 106

 54   Statement of Mr J Dean dated September 2010 at PNS 103-105

 55   Statement of Mr S Duggan dated 28 September 2010 at PN 33

 56   Statement of Mr S Duggan dated 28 September 2010 at PN 21

 57   Statutory Declaration of Mr J Dean filed 7 October 2010 at PNS 5-16

 58   Statement of Mr J Dean dated September 2010 at PNS 62-68

 59   Statement of Mrs R Duggan (undated) at PNS 7-8

 60   Statement of Mrs R Duggan (undated) at PNS 3-11

 61   Transcript of Proceedings PNS 969-977

 62   Transcript of Proceedings PNS 97-104

 63   Transcript of Proceedings PN 1108

 64   Transcript of Proceedings PNS 100, 103-104

 65   Transcript of Proceedings at PNS 1923-1926

 66   Transcript of Proceedings PNS 1923-1924

 67   Transcript of Proceedings PNS 1780

 68   Statement of Mr J Dean dated September 2010 at PN 134 and Attachment A5

 69   Appeal by Australian Liquor, Hospitality and Miscellaneous Workers Union against decision issued by Commissioner Eames on 24 February 1998 (U No. 80262 of 1997) [Print P9036] – re: termination of employment [Q1629] (3 July 1998) at PN 32

 70   Appeal by Australian Liquor, Hospitality and Miscellaneous Workers Union against decision issued by Commissioner Eames on 24 February 1998 (U No. 80262 of 1997) [Print P9036] – re: termination of employment [Q1629] (3 July 1998) at PNS 23 and 32

 71   Transcript of Proceedings at PNS 139-153



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