[2019] FWC 1687

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Orry Thompson
v
Zadlea Pty Ltd T/A Atlas Steel
(U2018/7070)

COMMISSIONER GREGORY

MELBOURNE, 15 MARCH 2019

Application for an unfair dismissal remedy.

Introduction

[1] Mr Orry Thompson is a Canadian national who was employed by Zadlea Pty Ltd T/A Atlas Steel (“Atlas Steel”) in June 2017 as a welder/metal fabricator. He originally came to Australia on a temporary working holiday visa, which expired in April 2018. He then entered into an employment contract with Atlas Steel whereby it agreed to be his approved nominee for a Temporary Skill Shortage Visa. However, he claims Atlas Steel subsequently withdrew its nomination, effectively terminating his employment.

[2] Atlas Steel rejects these submissions and claims instead that Mr Thompson abandoned his employment. It only proceeded to withdraw the visa nomination after this occurred, and did so in order to regain the nomination fee it had previously paid to the Immigration Department on his behalf.

[3] Ms T. Duthie from Gadens Lawyers was given permission to appear on behalf of Mr Thompson under s.596(2)(a) of the Fair Work Act 2009 (Cth) (“the Act”) as the matter involved a degree of complexity, particularly given the jurisdictional objection, and her involvement might enable it to be dealt with more efficiently. Mr M. Galvin, a Director of Atlas Steel, appeared on its behalf.

The Issue to be Determined

[4] Section 386 deals with the “Meaning of dismissed.” It states in part:

(1) a person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.”

[5] Section 385 continues to provide that a person has been unfairly dismissed if the Commission is satisfied that “the dismissal was harsh, unjust or unreasonable.” Section 387 also requires that the Commission must take into account the following considerations in determining whether a dismissal was harsh, unjust or unreasonable. It states:

“387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.” 1

[6] The Commission is accordingly required to first determine whether Mr Thompson was “dismissed” “as provided for by s.386, or whether he abandoned his employment as claimed by Atlas Steel.

[7] If the Commission finds that he has abandoned his employment then it is likely that he has not been “dismissed,” and his application must also be dismissed. However, if the Commission finds he was “dismissed” then it is required to determine whether his dismissal was “harsh, unjust or unreasonable” taking into account the various matters in s.387 it must have regard to.

The Applicant’s Evidence and Submissions

Mr Orry Thompson

[8] Mr Thompson is a Canadian citizen who came to Australia on a Working Holiday (Temporary) Visa which expired on 12 April 2018. He was employed by Atlas Steel as a welder/metal fabricator and commenced work in June 2017. In April 2018 he applied for a Temporary Skill Shortage (Medium-Term) (sub class 482) visa in order to enable him to continue working in Australia. One of the required criteria to be able to obtain this visa is to have an approved employer nominee.

[9] Mr Thompson entered into an employment contract with Atlas Steel in March 2018 whereby it agreed to be his approved nominee for the Temporary Skill Shortage Visa, and he was placed on a bridging visa by the Department of Home Affairs while his visa application was processed.

[10] During the time that he was employed by Atlas Steel he had two periods off work on medical grounds. In April 2018 he sustained a hand injury at work that required him to be off work for a period of one week. He was then off work for a further period of approximately 5 weeks due to issues associated with anxiety and depression. He returned to work on 25 May 2018.

[11] On 21 June 2018 Mr Thompson was involved in what he described as “a verbal and physical altercation” 2 with another work colleague, Mr Athol Robertson, at a job site in Kilmore East. The incident began with a disagreement about the construction of the steel framework on site. Mr Thompson said Mr Robertson began verbally abusing him and threatening to have him deported. He then pushed him and later threw stones at him. Mr Thompson subsequently spoke to Mr Matthew Leury, one of the Directors of Atlas Steel and told him he did not feel safe remaining on the site. He subsequently left the site and travelled back to the factory by train. He wanted to discuss the incident with the Directors but neither of them were at the factory at the time. He then left and went to the Brunswick Police Station where he made a report against Mr Robertson regarding what he described as “the physical assault.”3 He then received a phone call from Mr Leury who asked him to return to the factory. He then assured him that Mr Robertson would no longer be working on site.

[12] However, on 22 June 2018 he arrived at the factory and saw Mr Robertson standing outside the front door. He then went to Mr Leury’s office and said that he made threatening remarks about his visa and his employment, and made reference to the possibility of his visa being revoked. Mr Thompson indicated that the effect of the nomination being withdrawn would mean that he would lose his right to continue to work in Australia.

[13] Mr Thompson said that he was suffering from stress and anxiety as a consequence of what had occurred and made an appointment with his General Practitioner later that day. He was subsequently advised to take a period of two weeks’ stress leave and not return to work until 9 July. However, on 26 June 2018 he received a phone call from Mr Leury asking when he would be returning to work as there was a lot of work to be carried out. Mr Thompson indicated in response that he would not be back until after the two-week period of leave. He also indicated that he lodged a WorkCover claim on the previous day but this was initially rejected. However, he then appealed against the original decision and his claim was accepted following a conciliation conference on 27 August. He also indicated that he was contacted by phone by a WorkCover representative at one point and it was indicated to him in passing that WorkCover understood his visa nomination had been withdrawn.

[14] However, on 5 July he was then informed that his temporary skill shortage visa had been denied and on the following day he received a letter from the Department of Home Affairs indicating in part “your prospective employer, Zadlea Pty Ltd, does not have an approved nomination for you at this time. As a result, your visa application cannot be approved.” 4 He then sent Mr Leury a text message asking why Atlas Steel had withdrawn its nomination but did not receive a response. He also rejected its claims that his visa had been denied because he had not provided relevant documentation and states instead that he had provided all relevant documents to the Department of Home Affairs. He also indicated in his examination in chief that the Department of Home Affairs had never indicated at any stage that he had not provided all necessary documentation. He stated in conclusion that Atlas Steel’s conduct “was consistent with its intention of terminating my employment.”5

[15] He also indicated in cross examination that he recalled that his WorkCover claim was “lodged on the Monday following the incident which occurred on the Thursday prior after not receiving any contact from my employer.” 6 He also denied in cross examination that he had not forwarded any required documentation to the Department of Home Affairs and had instead completed all documentation provided to him by the Department and by the business.

[16] He also rejected the suggestion that he had not made contact with the business after the incident that occurred on 21 June, and indicated instead that his records indicated that he spoke with Mr Leury on 26 June, although he was unsure about whether Mr Leury had called him from his mobile phone or from a landline.

The Applicant’s Submissions

[17] Mr Thompson submits that his employment was terminated at the Respondent’s initiative, and further that his dismissal was harsh, unjust and unfair.

[18] He relies on the fact that Atlas Steel concedes that it withdrew his visa nomination, which meant he could not continue to work for the business. If it had not taken this action then he would have returned to work at the conclusion of his period of medical leave. It was also premature for Atlas Steel to have decided that he had abandoned his employment after only three working days had elapsed. In addition, the business had not even attempted to make contact with him to find out what was going on during that time.

[19] Mr Thompson submits instead that his version of events is to be preferred and that he sent the certificate of capacity to Atlas Steel on 22 June 2018, indicating that he was going to be off work for a period of two weeks until 9 July, and it was received by the business shortly after that date. The business was accordingly aware that he was off work on leave due to stress and anxiety. This was also consistent with his earlier periods of leave due to mental health issues. The full details of his WorkCover claim were forwarded to the business on a later date. However, he submits that Atlas Steel then decided, after discovering that he was taking a further period of medical leave, to withdraw his visa nomination and his employment was effectively brought to an end. As a consequence the reasons for his termination were never put to him and due process cannot be said to have been followed.

[20] He continues to submit that the outcome of the WorkCover investigation is irrelevant in all the circumstances because that outcome was only made known around twenty days after the visa nomination had been withdrawn, and accordingly could not have been influential in determining the decision by Atlas Steel to withdraw its nomination.

[21] Mr Thompson also submits that Atlas Steel conducted no formal investigation into the incident between him and Mr Robertson, despite the fact that Mr Thompson considered it to be significant enough to attend the Brunswick Police Station on the night of the incident to lodge a report about Mr Robertson’s behaviour.

[22] He also submits that at the time his employment was terminated he had an approved nomination, which that he intended to continue to be employed for a significant period of time. In addition, the fact that he had been required to take time off work due to mental health issues should not have affected his ongoing employment in any way, and he should again be considered to be a person who was likely to be employed for a significant period of time.

The Respondent’s Submissions and Evidence

Mr Mark Galvin

[23] Mr Galvin is a Director of Atlas Steel. He did not provide a witness statement in advance of the proceedings, but did provide some sworn evidence.

[24] He indicated that a review of Mr Matthew Leury’s phone records do not indicate that Mr Leury used his mobile phone to ring Mr Thompson in the period between 26 June and 6 July last year. He also stated that Mr Thompson had not provided the business with further police checks by 28 June, which were required in support of his immigration claim. He also stated that the business had no communication from him during the period from 22 June until 5 July when Mr Thompson contacted Mr Leury to ask why he had withdrawn the visa. The business accordingly concluded that he had abandoned his employment.

[25] Mr Galvin also indicated that he was aware Mr Thompson was on a temporary skills shortage visa which required an approved employer nomination. He also understood that if the business withdrew that nomination Mr Thompson could not continue working for Atlas Steel. However, he continued to indicate that at the time the business withdrew the nomination it had concluded that Mr Thompson was no longer working for the business because he had abandoned his employment. It was also concerned because it had paid fees to the Immigration Department on behalf of Mr Thompson, and it was concerned about getting its money back after it concluded that he had abandoned his employment.

[26] He also acknowledged that Atlas Steel had indicated in its outline of argument dated 15 October 2018 that it had concluded that Mr Thompson had abandoned his employment, given his absence from work for a continuous period of more than three days, and consequently it decided to withdraw its nomination. He also confirmed that the business did not attempt to contact Mr Thompson after he had not turned up for a period of three days, and it did not believe there was any requirement for it to do so. He also stated that Atlas Steel did not receive his certificate of capacity until 6 July. Mr Thompson had also been absent from work on 41 days previously during the course of his employment with the business, apparently due to mental health issues.

[27] Mr Galvin also denied that the business had simply decided to get rid of Mr Thompson, rather than doing a proper investigation, because of the incident that occurred between him and Mr Athol Robertson. He also stated that the business had no reason to get rid of Mr Thompson because there was plenty of work available at the time.

Mr Matthew Leury

[28] Mr Leury is the Manager at Atlas Steel and is also a Director of the business. He prepared a statement dated 12 July 2018 for the purpose of a WorkCover investigation into the incident involving Mr Thompson and Mr Robertson. He indicated that this statement was also a true and correct record of the evidence he sought to rely upon in regard to this application.

[29] Mr Leury indicated in the witness statement that he prepared for the WorkCover investigation that prior to 21 June 2018 he was not aware of any issues between Mr Robertson and Mr Thompson. However, on 21 June he was talking on the phone with the Site Foreman at a site in Kilmore East when the Site Foreman told him that Mr Thompson and Mr Robertson were arguing. The argument became increasingly intense and Mr Robertson apparently tried to kick Mr Thompson.

[30] Mr Leury then spoke to Mr Thompson on the phone, who told him that he could not work with Mr Robertson. Mr Thompson then left the site and came back to the depot after having gone to the police. Mr Thompson was then meant to be at work on Friday, 22 June after being told that he and Mr Robertson would be separated until Mr Leury had time to carry out a proper assessment into what had occurred.

[31] However, when Mr Thompson arrived on the morning of 22 June he saw Mr Robertson and became very upset and agitated. Mr Leury said he tried to talk to him calmly but he remained aggravated, and Mr Leury then explained that he would not do anything until he had assessed both sides of what had occurred. Mr Thompson then refused to remain at work.

[32] Mr Leury indicated in conclusion that since leaving work on 22 June Mr Thompson had texted him on two occasions accusing him of revoking his visa, but he had chosen not to reply. He also stated that the business had not terminated Mr Thompson’s employment because he had a WorkCover claim pending, but it did not believe that it could take him back as an employee because he does not hold a current work visa.

[33] Mr Leury denied in cross examination that Mr Thompson told him on 22 June that he could not return to work because he was suffering from stress and anxiety. However, he did say that he could not come back to work because he could not be in the same building as Mr Thompson and he then walked out. Mr Leury said this was the last time he had heard from him and he had not been involved in a subsequent phone call with Mr Thompson. He also understood that as a consequence of him leaving his employment his visa would be withdrawn.

The Respondent’s Submissions

[34] Atlas Steel submits at the outset that it did not want Mr Thompson to leave his employment as he was a skilled worker and it had a significant amount of work on at the time. However, it did not dismiss him and he instead decided to abandon his employment. This occurred in circumstances where he was absent from work for more than three days without approval, and without Atlas Steel being provided with any advice from him about his whereabouts.

[35] It acknowledges in its submissions that Mr Thompson was involved in a dispute with another employee on a worksite on 21 June 2018. He then came to work on the following day and again encountered the other employee. He then demanded in an aggressive manner that the other employee be dismissed, but was told that this was not going to happen, and no further action would be taken until it had been determined who was at fault in regard to the incident on the previous day. It submits that Mr Thompson then packed his gear and left, and nothing further was then heard from him until a text was received on 5 July complaining that the business had withdrawn his visa nomination.

[36] Atlas Steel continues to submit that, “Given his absence from work for a continuous period of more than 3 days without our consent and without having received any notification we considred [sic] that sufficient evidence that Mr Thompson had abandoned his employment.” 7

[37] Atlas Steel also submits that it had previously paid the $3,000 sponsorship fee amount on behalf of Mr Thompson to the Department of Immigration and then decided, after he had abandoned his employment, that it was appropriate to try and recover that amount. It therefore withdrew its support for his visa nomination. It had also been required to pay a further amount of $500 on its own behalf as part of the sponsorship arrangements.

[38] It also submits that it decided to pay out Mr Thompson’s WorkCover claim on the recommendation of its WorkCover agent as a matter of economic expediency after Mr Thompson appealed the rejection of the claim at first instance, and it subsequently paid an amount equivalent to 4 weeks’ salary to Mr Thompson.

[39] Atlas Steel also denies that any discussion took place between Mr Thompson and Mr Leury on 26 June, and that this was confirmed by an examination of Mr Leury’s mobile phone records. It also submits that it has no record of having received a copy of Mr Thompson’s WorkCover claim prior to its receipt by the business on 6 July 2018. It continues to submit that the claim was subsequently rejected at first instance by WorkCover, and its investigation concluded that Mr Thompson was the aggressor in the incident that occurred on 21 June.

Consideration

[40] As indicated at the outset in dealing with this application the Commission is first required to determine whether Mr Thompson was dismissed in accordance with the definition contained in s.386 of the Act, or whether he can be said to have abandoned his employment as claimed by Atlas Steel.

[41] There was initially some uncertainty about when Atlas Steel came to the conclusion that Mr Thompson had abandoned his employment. However, in the outline of argument it provided to the Commission on 15 October last year it stated:

“Given his absence from work for a continuous period of more than 3 days without our consent and without having received any notification we considred [sic] that sufficient evidence that Mr Thompson had abandoned his employment.

Consequently, we decided to withdraw his nomination as we wanted to ensure we got our money back from the immigration department. Note we’d paid the $3,000 odd fee on Mr Thompsons [sic] behalf for this nomination.”

[42] Mr Galvin was also referred to these extracts in cross examination, and when asked whether he now agreed that Atlas Steel reached the conclusion that Mr Thompson had abandoned his employment after three days he responded by indicating, “I guess so.” 8 He also confirmed that no attempt was made to contact Mr Thompson during that three-day period, and there was not seen to be any need to attempt to make contact with him.

[43] The evidence also indicates that on 21 June 2018 Mr Thompson was involved in what was at least an aggressive verbal altercation with another employee at a worksite in Kilmore East. He subsequently told his Manager that he could not continue to work with that employee. He also considered the incident significant enough to make a report to the police at the Brunswick Police Station later on the same day. However, when he turned up at work on the following day he again encountered the same employee and, as a consequence, became very upset and agitated and left the workplace.

[44] He then obtained an appointment with his General Practitioner later that day and a certificate of capacity was subsequently forwarded to Atlas Steel, although it claims it was not received until 6 July. Mr Thompson also made a WorkCover claim which was the subject of a subsequent investigation. The results of that investigation were not made known until sometime later in July. Mr Thompson also claims that he received a phone call from Mr Leury on 26 June 2018 asking when he would be returning to work, however, Mr Leury denies that this call was ever made.

[45] The Commission was only taken in a limited way in the parties’ submissions to what is required to come to a conclusion that an employee has abandoned their employment. The submissions provided on behalf of Mr Thompson made reference to the decision of then Commissioner Asbury in the matter of Sharpe v MCG Group Pty Ltd. 9 He submits that the Commission found in that matter that where an employee had notified their employer that they would be unable to attend work due to medical reasons, and the person was then terminated, that they were found to have been terminated at the initiative of the employer. An argument that the employee had abandoned their employment by not attending at work as directed was rejected. Specific reference was made to the following passage from the decision:

“The concept of abandonment of employment is not new to employment law. It is a term that is often loosely used, or used without consideration of the effect of the abandonment upon the employment relationship or the contract of employment. Generally, abandonment arises in circumstances where an employee is absent from the workplace without reasonable excuse, or has failed to communicate with the employer to provide an excuse for being absent.” 10

[46] Issues associated with abandonment of employment were also more recently considered as part of the 4 yearly review of modern awards. A Full Bench of the Commission handed down a decision in January 2018, which specifically considered these issues in the context of provisions in a number of Awards, including the Manufacturing and Associated Industries and Occupations Award 2010 (“the Manufacturing Award”). That Award is presumably relevant to the employment of Mr Thompson, given the nature of his work as a welder/metal fabricator. The relevant provision in the Manufacturing Award state as follows:

“21. Abandonment of employment

21.1 The absence of an employee from work for a continuous period exceeding three working days without the consent of the employer and without notification to the employer is primer face the evidence that the employee has abandoned their employment.

21.2 If within a period of 14 days from their last attendance at work or the date of their last absence in respect of which notification has been given or consent is being granted an employee has not established to the satisfaction of their employer that they were absent for reasonable cause, the employee is deemed to have abandoned their employment.

21.3 Termination of employment by abandonment in accordance with clause 21 – Abandonment of employment operates as from the date of the last attendance at work or the last days absence in respect of which consent was granted, or the date of the last absence in respect of which notification was given to the employer, whichever is the later.”

[47] The Full Bench in its decision usefully continued to give consideration to the meaning of the expression “abandonment of employment,” and to its relevance in the context of an unfair dismissal application. It also had regard to the relevance of the above Award provision, which has subsequently been deleted from the Modern Award.

[48] The Full Bench stated as follows (references omitted):

“[21] “Abandonment of employment” is an expression sometimes used to describe a situation where an employee ceases to attend his or her place of employment without proper excuse or explanation and thereby evinces an unwillingness or inability to substantially perform his or her obligations under the employment contract. This may be termed a renunciation of the employment contract. The test is whether the employee’s conduct is such as to convey to a reasonable person in the situation of the employer a renunciation of the employment contract as a whole or the employee’s fundamental obligations under it. Renunciation is a species of repudiation which entitles the employer to terminate the employment contract. Although it is the action of the employer in that situation which terminates the employment contract, the employment relationship is ended by the employee’s renunciation of the employment obligations.

[22] Where this occurs, it may have various consequences in terms of the application of provisions of the FW Act. To give three examples, first, because the employer has not terminated the employee’s employment, the NES requirement in s 117 for the provision of notice by the employer, or payment in lieu of notice, will not be applicable. Second, if a modern Award or enterprise agreement provision made pursuant to s 118 requiring an employee to give notice of the termination of his or her employment applies, a question may arise about compliance with such a provision. Third, if the employee lodges an unfair dismissal application, then the application is liable to be struck out on the ground that there was no termination of the employment relationship at the initiative of the employer and thus no dismissal within the meaning of s 386(1)(a) (unless there is some distinguishing factual circumstance in the matter or the employee can argue that there was a forced resignation under s 386(1)(b)).

[23] Against this background, what purpose does clause 21 of the Manufacturing Award seek to achieve? As discussed in Iplex, while clause 21.1 renders a certain factual situation involving an absence from work to be prima facie evidence of abandonment of employment, and clause 21.2 purports to deem another factual situation involving a longer absence from work to be an abandonment of employment, neither provision operates to automatically terminate the employment. Nor do we consider that clause 21.2 was intended to, or could, “deem” there to be a renunciation of the employment contract by the employee for the purpose of s 117, any Award or agreement provision made pursuant to s 118, s 386(1) or any other relevant provision of the FW Act. We are inclined to the view, along the lines of the submission put by the AMWU, that what clauses 21.1 and 21.2 seek to achieve is to establish a minimal process by which an employer may proceed to dismiss an employee in response to an absence from work without consent. Clause 21.2 in particular requires the employer to determine whether the employee has established to the employer’s satisfaction that there was reasonable cause for the absence prior to the termination of the employee by the employer, which implies some measure of consultation or attempted consultation with the employee. The function of clause 21.1 in the process is less clear, but it may be that an absence of over three days calls for an explanation from the employee as to why he or she should not be regarded as having abandoned the employment, with again the implication being that the employer will attempt to consult with the employee, as a prerequisite to the operation of clause 21.2.

[24] Based on the approach taken in Iplex, clause 21.3 is to be read as operating so that when an employer terminates the employment for an absence from work after the conditions in clause 21.2 are satisfied, the termination operates retrospectively from the date of the last attendance at work, or the date of the last absence from work which was consented to by the employer or for which notification was given. That is, it is concerned with the date of operation of a dismissal under clause 21.2. Clause 21.3 would effect a modification to the common law principle that a termination of employment cannot take effect unless it is first communicated to the employee, subject only to the possible exception that a contract of employment might contain an express provision to the contrary.” 11

[49] Three of the conclusions contained in these extracts from the Full Bench decision are of particular relevance to the present matter. Firstly, the Full Bench has set out the test to be applied in considering whether an employee can be said to have abandoned their employment. In its words, “The test is whether the employee’s conduct is such as to convey to a reasonable person in the situation of the employer a renunciation of the employment contract as a whole or the employee’s fundamental obligations under it.” 12 Secondly, the Full Bench has indicated that if an employee is found to have abandoned their employment, and an application claiming unfair dismissal is subsequently lodged, then the application might well be struck out on the grounds that there was no termination of the employment relationship at the initiative of the employer, and therefore no dismissal within the meaning of the Fair Work Act. Finally, the Full Bench has emphasised that it will normally be expected that the employer will have consulted, or attempted to consult, with the employee as part of the process of establishing the cause of the employee’s absence. While the Full Bench made these comments in the context of the Manufacturing Award I am also satisfied that such processes would normally be expected to be a part of what could reasonably be expected in the context of an employer coming to a conclusion that an employee has renounced their employment contract by abandoning their employment.

[50] Applying the approach adopted by the Full Bench I am not satisfied that it can be concluded that Mr Thompson has abandoned his employment on the basis that he has ceased to attend his place of employment without proper excuse or explanation. I am also satisfied that before being able to legitimately come to this conclusion Atlas Steel must have contacted or attempted to make contact with Mr Thompson in order to obtain an explanation from him about what was occurring.

[51] If it had done so it would have found that a different scenario was unfolding. Mr Thompson was apparently anxious and upset about what occurred at work on 21 and 22 June last year. After leaving work on 22 June he managed to obtain an appointment with his General Practitioner at the Brunswick Central Medical Centre, who provided him with a certificate of capacity regarding a work-related injury/condition, which indicated that it was necessary for him to be off work until 5 July 2018. Mr Thompson claims that this certificate was forwarded immediately to Atlas Steel, although it claims it was not received until 6 July. Mr Thompson subsequently lodged a WorkCover claim on 25 June, but again the business claims it was not notified of this until sometime later. However, I am satisfied that the evidence indicates that rather than acting as someone who was abandoning their employment Mr Thompson’s actions were instead consistent with someone who was suffering at the time from work-related stress and anxiety, and required a period of leave from work as a consequence.

[52] As indicated, I am also not satisfied that Atlas Steel was entitled to conclude in all the circumstances that after a period of only three days absence from work that Mr Thompson had abandoned his employment. There are some obvious steps that could be expected of it before coming to this conclusion. Firstly, it could be expected that it would have carried out some form of investigation into the issue that arose at the worksite on 21 June between Mr Thompson and Mr Robertson. It appears that this incident had the potential to escalate, and in the interests of the health and safety of all of its employees it could be expected that Atlas Steel would have made immediate and urgent attempts to understand what had occurred on that day, and to ensure that there was no repetition of that kind of behaviour.

[53] Secondly, and perhaps most evidently it could be expected that Atlas Steel would have attempted to make contact with Mr Thompson to ascertain why he was not at work before coming to the seemingly premature conclusion that he had abandoned his employment. This would be a minimum expectation of any reasonable employer in the circumstances. It is unclear why it did not do so, apart from the indications in its witness evidence that it saw no need to attempt to make contact with him. The evidence of Mr Leury is that he also decided not to respond to Mr Thompson after he sought to make contact with him to get an explanation about why his visa nomination had been withdrawn. It is possible to speculate why Atlas Steel simply decided to come to the conclusion at this point that Mr Thompson had abandoned his employment, but such speculation at this point is perhaps unnecessary. I am satisfied instead that it is sufficient to conclude that there is no evidence to substantiate the decision that Atlas Steel came to at the time that Mr Thompson had abandoned his employment. Having come to this conclusion I now turn to consider whether Mr Thompson was unfairly dismissed.

[54] In determining whether Mr Thompson’s dismissal was “harsh, unjust or unreasonable” it is necessary to take into account the various considerations in s.387. The nature of the circumstances which might be considered to be “harsh, unjust or unreasonable” has been considered in various previous decisions. For example, in the often quoted decision in Byrne v Australian Airlines Ltd 13 McHugh and Gummow JJ concluded that:

“...It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.” 14

[55] The decision of the Full Bench of Fair Work Australia in L. Sayer v Melsteel Pty Ltd 15 also provides guidance about the Commission’s role in regard to each of the considerations in s.387. It concluded:

“Where the applicant does present a case, in the ordinary course each of the criteria in s.387 which is capable of being relevant on the facts emerging at the hearing must be taken into account.” 16

[56] Vice President Ross, as he then was, in B Rose v Telstra Corporation Limited 17 (Rose) restated the above proposition, and also added (references omitted):

“In my view whether there has been a `fair go all round’ is a matter which I think is relevant and hence I am to have regard to it determining whether the termination was harsh, unjust or unreasonable. It is not necessarily determinative but it is a factor to be taken into account.” 18

[57] I now turn to consider whether Mr Thompson’s dismissal can be said to be “harsh, unjust or unreasonable” taking into account each of the considerations in 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)

[58] Previous authorities have again considered what is required in order to conclude that there was “a valid reason for the dismissal related to the person’s capacity or conduct.” The judgement of Northrop J in Selvachandran v Peteron Plastics Pty Ltd 19 is often referred to in this context. His Honour came to the following conclusions:

“The reasons of an employer for terminating the employment of an employee are solely within the knowledge of the employer. The employer may state a reason but that reason need not be the actual reason nor need it be the only reason. This is the rationale for the onus of proof provisions contained in s 170EDA.

Section 170DE(1) refers to ‘‘a valid reason, or valid reasons’’, but the Act does not give a meaning to those phrases or the adjective ‘‘valid’’. A reference to dictionaries shows that the word ‘‘valid’’ has a number of different meanings depending on the context in which it is used. In the Shorter Oxford Dictionary, the relevant meaning given is: ‘‘2. Of an argument, assertion, objection, etc; well founded and applicable, sound, defensible: Effective, having some force, pertinency, or value.’’ In the Macquarie Dictionary the relevant meaning is ‘‘sound, just, or well founded; a valid reason’’

In its context in s 170DE(1), the adjective ‘valid’ should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s 170DE(1). At the same time the reason must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must ‘be applied in a practical, commonsense way to ensure that’ the employer and employee are each treated fairly…” 20

[59] In Parmalat Food Products Pty Ltd v Wililo 21 the Full Bench also concluded that:

“The existence of a valid reason is a very important consideration in any unfair dismissal case. The absence of a valid reason will almost invariably render the termination unfair. The finding of a valid reason is a very important consideration in establishing the fairness of a termination. Having found a valid reason for termination amounting to serious misconduct and compliance with the statutory requirements for procedural fairness it would only be if significant mitigating factors are present that a conclusion of harshness is open.” 22

[60] The Full Bench majority in B, C and D v Australian Postal Corporation T/A Australia Post 23 (“Australian Postal Corporation”) also provides a useful summary of the approach to be taken by the Commission in weighing the various factors to be considered:

“Reaching an overall determination of whether a given dismissal was “harsh, unjust or unreasonable” notwithstanding the existence of a “valid reason” involves a weighing process. The Commission is required to consider all of the circumstances of the case, having particular regard to the matters specified in s.387, and then weigh:

(i) the gravity of the misconduct and other circumstances weighing in favour of the dismissal not being harsh, unjust or unreasonable;

against

(ii) the mitigating circumstances and other relevant matters that may properly be brought to account as weighing against a finding that dismissal was a fair and proportionate response to the particular misconduct.” 24

[61] It is also clear that the reason must be valid when viewed objectively. It is not sufficient that the Employer believed it had a valid reason for termination. This was made clear in the Full Bench decision in Rode v Burwood Mitsubishi 25 at paragraph 19 when it stated:

“…the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts. It is not sufficient for an employer to simply show that he or she acted in the belief that the termination was for a valid reason.” 26

[62] As indicated, Atlas Steel is of the view that Mr Thompson abandoned his employment and was not dismissed. However, the Commission has concluded that he cannot be said to have abandoned his employment based on the evidence now before it. However, as a consequence of coming to the conclusion that Mr Thompson had abandoned his employment, Atlas Steel also decided to withdraw its nomination of him as an approved nominee for a temporary skill shortage visa. The withdrawal of this nomination effectively acted to terminate his employment. It is not possible to conclude in these circumstances that Atlas Steel had a valid reason to terminate Mr Thompson’s employment by taking the action that it did.

[63] The remaining matters in s.387 that the Commission is required to have regard to have been set out at an earlier point in this decision and it is not necessary to restate them now. They are of limited relevance in the context of the present matter, given that Atlas Steel maintains that it did not act to dismiss Mr Thompson. It follows as a consequence that it did not have regard to the various matters set out in paragraphs (b) to (h) of s.387 in coming to its decision that he had abandoned his employment.

Conclusion

[64] The circumstances involved in this matter have been set out in some detail already and it is not necessary to restate them now. I have already concluded, based on the available evidence now before the Commission, that Mr Thompson cannot be said to have abandoned his employment. I am also satisfied that by withdrawing its visa nomination Atlas Steel effectively acted to terminate his employment. I am satisfied that its actions in doing so were at the very least harsh and unreasonable, and as a consequence Mr Thompson can be said to have been unfairly dismissed. I now turn to consider what remedy is appropriate.

Remedy

[65] I am satisfied at the outset that any consideration about Mr Thompson being reinstated is out of the question, given the degree of antipathy demonstrated by the participants in the proceedings, and the fact that Atlas Steel is a relatively small organisation. In addition, Mr Thompson does not seek to be reinstated to his position. It is also unclear whether that option is even possible given that his visa nomination has been withdrawn by the business. I accordingly now turn to consider whether it is appropriate to make an order for compensation.

[66] Section 392 of the Act states:

“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.” 27

[67] In relation to the amount of any compensation that might be awarded previous Commission decisions have made clear that it is necessary to take into account all of the circumstances of the case, including the specific matters identified in s.392(2)(a) to (g), and to consider the other relevant requirements in s.392. The long established approach to the assessment of compensation is to apply the formula derived from the Full Bench decision in Sprigg v Paul’s Licensed Festival Supermarket (“Sprigg”). 28 This approach was most recently confirmed in the context of the present legislative framework by the Full Bench in Bowden v Ottrey Homes Cobram and District Retirement Villages Inc. T/A Ottrey Lodge (“Bowden”).29 The first, and perhaps most important step to be taken, is to determine what the employee would have received by way of remuneration, or would have been likely to receive, if they had not been dismissed. This was described in Bowden, citing Ellawala v Australian Postal Corporation,30 in the following terms:

“[33] The first step in this process - the assessment of remuneration lost - is a necessary element in determining an amount to be ordered in lieu of reinstatement. Such an assessment is often difficult, but it must be done. As the Full Bench observed in Sprigg:

‘... we acknowledge that there is a speculative element involved in all such assessments. We believe it is a necessary step by virtue of the requirement of s.170CH(7)(c). We accept that assessment of relative likelihoods is integral to most assessments of compensation or damages in courts of law.’

[34] Lost remuneration is usually calculated by estimating how long the employee would have remained in the relevant employment but for the termination of their employment. We refer to this period as the ‘anticipated period of employment’. This amount is then reduced by deducting monies earned since termination. Only monies earned during the period from termination until the end of the ‘anticipated period of employment’ are deducted.” 31

[68] Once this assessment has been made various adjustments are then required, including for the amount of income earned since the time of dismissal, any amount on account of contingencies, any reduction on account of the employee’s misconduct, and the application of the statutory salary cap. This approach is, however, subject to the overarching requirement to ensure that the level of compensation is an amount that is considered appropriate having regard to all of the circumstances.

[69] I now turn to deal with the matters in s.392 in the order in which they appear. I am not aware of any evidence to suggest, firstly, that there is any issue concerning the effect of any order of compensation on the viability of Atlas Steel. While it is obviously a relatively small business it indicated in its submissions that it has nineteen employees, and there was nothing put to suggest that any order of compensation was likely to impact on the ongoing viability of the business.

[70] Secondly, Mr Thompson was only employed by the business from July 2017 until June last year. This is obviously not a long period of employment.

[71] The Commission is next required to consider what remuneration Mr Thompson would have earned if he had not been dismissed. This is inevitably a matter that is difficult to come to a definitive conclusion about, and essentially involves making an estimate about how long he might have remained in employment had his employment not been brought to an end.

[72] I am satisfied that there are a number of matters that are relevant in this context. Firstly, Atlas Steel indicated in its witness evidence that Mr Thompson had taken around 41 what it described as “unauthorised” days off in the time that he had been employed. It appears that this was related to leave associated with a mental health condition that Mr Thompson was suffering from. The Commission has no reason at this point to question the validity of this leave that was taken. However, it is evident from the nature of the evidence provided in the proceedings that these absences from work were a frustration for the business. Secondly, Mr Leury indicated in the witness statement that he provided as part of the WorkCover investigation that while Mr Thompson had initially appeared to have been an even-tempered person, he described his attendance and behaviour in more recent times as being volatile and unpredictable. Atlas Steel also indicated in its submissions that the subsequent WorkCover investigation apparently concluded that he was the aggressor and the cause of the incident that occurred at the worksite in Kilmore East on 21 June. All of this would suggest that the employment relationship was becoming increasingly tenuous and that Mr Thompson was unlikely to remain in long-term employment at Atlas Steel.

[73] However, it is also noted that he wanted to continue working for the sake of enhancing his ability to gain permanent resident status in Australia, and it appears that he had skills that were in demand, and that there was plenty of ongoing work available at the time.

[74] However, I am satisfied on balance that the above circumstances suggest that it was unlikely that Mr Thompson would have continued to have been employed by Atlas Steel for an extended period of time if his employment had not effectively been brought to an end. Again, while it is impossible to be precise about how long that period might have been I am satisfied that it is reasonable to conclude that in all the circumstances he would not have remained in employment for a period of more than six months.

[75] Mr Thompson provided no information or other materials about his attempts to obtain other employment, but presumably he had little opportunity to do so following the withdrawal of his visa nomination. It would seem that he was accordingly unlikely to earn other income in the relevant period. However, it is noted that despite the apparent rejection of his WorkCover claim Mr Thompson was paid an additional amount equivalent to 4 weeks’ pay by Atlas Steel. This payment was apparently made as an agreed outcome from a conciliation conference held on 27 August 2018, based on advice received by its WorkCover agent.

[76] The legislation also makes clear that if the Commission is satisfied that the employee’s misconduct contributed to the decision to dismiss the employee then the amount that might otherwise be ordered by way of compensation is to be reduced. Atlas Steel makes reference to various matters that might be considered in this context. It was concerned at various times that Mr Thompson was not providing relevant documentation required by the Department of Immigration, including relevant police checks. It also submits that on various occasions he did not turn up for work and did not provide an explanation for his absence. On 22 June last year he was accused of having sworn at one of the Directors of the business. Atlas Steel also points to the outcome from the WorkCover enquiry which apparently concluded that his injuries were caused as a result of his own misconduct. I am accordingly satisfied in all the circumstances that it is appropriate to reduce the amount of compensation that might otherwise be awarded to Mr Thompson by an amount of 20 percent.

[77] The decision in Sprigg also makes reference to the requirement to consider the impact of contingencies, and whether they should have any impact on the amount to be awarded. It also makes clear that this applies, in particular, to the estimate being made about the anticipated period of future employment. Given all of these uncertainties in this matter I am satisfied that it is appropriate to make a further deduction of 20 percent from the total amount of compensation awarded.

[78] The compensation cap is then referred to in s.392(5), and provides that the amount ordered by the Commission must not exceed the lesser of the total amount of remuneration either received by the person, or to which the person is entitled for any period of employment with the employer during the 26 weeks immediately before the dismissal, and half the amount of the high income threshold immediately before the dismissal. That amount was $145,400.00 immediately before the time of Mr Thompson’s dismissal. The amount of compensation currently under consideration in this matter is clearly well below the compensation cap.

Conclusion as to Remedy

[79] The amount of compensation that the Commission has accordingly arrived at has been calculated on the following basis:

• Step 1: lost remuneration (4 months) – $20,064.00

• Step 2: deduct additional payment already made (4 weeks) – $5,016.00

• Step 3: deduction for contingencies (20%) – $4,012.80

• Step 4: deduction for misconduct (20 %) – $4,012.80

= $7,022.40

[80] The final amount of compensation to be ordered is therefore $7,022.40, less deduction of any tax as required by law. I am satisfied that this amount of compensation is an appropriate amount in all the circumstances. In accordance with s.392(1) the amount of the order does not include any payment by way of compensation for shock, distress, humiliation, or other analogous hurt caused to Mr Thompson by the manner of his dismissal.

[81] The Commission accordingly orders that Atlas Steel pay Mr Thompson the sum of $7,022.40, less deduction of any tax as required by law, within 21 days of the date of this decision. An Order to this effect is issued in conjunction with this decision in PR705860.

al of the Fair Work Commission with member's signature