Allison v Bega Valley Council 63 IR 68

Industrial Relations Commission (NSW)|2002-12-20|Before: Mr J

CITATION: Ramnani and Specix Pty Ltd [2005] [2005] NSWIRComm 1211

APPLICANT Sabita Ramnani PARTIES: RESPONDENT Specix Pty Ltd

Unfair dismissal - alleged constructive dismissal - changes in work allocation - rejected by applicant - whether dismissal or resignation sought - if resignation whether constructive dismissal - principles to be applied. CATCHWORDS: Held - employer entitled to make changes sought, resignation not sought but put as consequence of refusal to accept change - managerial prerogative - not demotion - employment still available- resignation by employee not constructive dismissal - application dismissed.

LEGISLATION CITED: Industrial Relations Act 1996

Allison v Bega Valley Council 63 IR 68 Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union New South Wales Branch v Sydney Water Corporation [2005] NSW IR Comm 1120 Bankstown City Council v Paris (unreported) IRC 262 of 1999. Bates v Gundegai District Services Club IRC 4710 of 1999 Britten v Riverstone Public School IRC 5504 of 1999. Brown v Dunn (1894) 6R (HL) 67 Clark v Pittwater RSL Club Ltd (1998) 84 IR 369. Department of Water Resources v Australia Workers Union New South Wales Branch [1992] 43 IR 76. CASES CITED: Federated Engine Drivers & Fireman's Assoc. of Australasia (Coast District) v Broken Hill Pty Company Ltd 1950 AR 371. Hanslow v Nationwide News Pty Ltd t/as News Advantage Sydney IRC 4390 of 2002 (20 December 2002). Outboard World v Muir (1993) 51 IR 167. Police Service of New South Wales v Batton (2000) 98 IR 154. Sams v Contact Point International Pty Ltd (2001) NSW IR Comm 18. Seipal v John Fairfax Holdings Ltd (25 July 2002) IRC 3635 of 2001 Sparrow v Little t/as Milk Plus (1998) 78 IR 365 St Vincent's Hospital v Harris (1998) NSW IR Comm 235

Ms L Tucker, Solicitor Kingsford Legal Centre LEGAL REPRESENTATIVES: Mr J Kartsounis, Solicitor J Kartsounis & Company

DECISION: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

Application by Sabita Ramnani re Unfair Dismissal pursuant to section 84 of the Industrial Relation Act 1996

1 This is an application by Sabita Ramnani against Specix Pty Ltd, for a remedy pursuant to S.84 of the Industrial Relations Act, 1996. Ms Ramnani alleged that she was constructively dismissed from her position of specification representative with the company on the 1 September 2004. She sought monetary compensation in lieu of reinstatement or re-employment.

2 The matter was listed for Conciliation and Directions before me on the 14 October 2004 at which time conciliation took place. The parties were directed to confer and the matter set down for further conciliation on the 1 November 2004. However this date was vacated at the request of the applicant who was seeking legal assistance. Further conciliation took place on the 19 November 2004. However as no settlement could be reached the matter was set down for hearing on the 24 June 2005. Directions were issued as to the filing and exchange of witness statements.

3 At the hearing Ms Tucker, Solicitor, appeared on behalf of Ms Ramnani, who also gave evidence and filed affidavits (Exhibits 1 & 2).

4 Mr Kartsounis, Solicitor, appeared on behalf of the respondent and called the following witnesses who had all filed affidavits.

Helen Awali - Director, Specix (Exhibit 5) Janelle Sultan - Relationship Manager, Specix (Exhibit 8) Sharif Hamawi - Office Administrator, Specix (Exhibit 9) Belinda Wu - Marketing Coordinator, Specix (Exhibit 10)

5 The evidence concluded on 24 June 2005 and Directions were issued as to the filing and exchange of written submissions as per an agreed timetable between the parties.

6 Those Directions were not able to be complied with by the respondent and ultimately written submissions were received from the parties as follows:

Applicant - 27 July 2005 Respondent - 7 October 2005 Applicant - 18 October 2005

7 The following is a brief background and chronology based on the evidence filed and the transcript.

8 Specix Pty Ltd is a small architectural public relations firm which promotes manufactured building products to designers, builders and architects.

9 The source of work for the company is from manufacturers who wish to market their products. This was achieved by presentations to groups of architects and builders, of projects responsible for the preparation of construction certificates for local council approval. Those certificates contain the exact specifications of the products and materials to be used in the building of the project. Through the presentations they would be made aware of the products on offer when preparing their construction certificate specifications.

10 Clients of Specix paid a monthly fee for the company to promote their products. The success of the business was dependent on the number and quality of presentations made on behalf of clients. The effectiveness of the efforts of Specix were subject of regular monthly reports to clients.

11 Helen Awali is the Director and founder of Specix. She holds architectural qualifications.

12 The company commenced operations in early 2004 with Ms Awali doing presentations on her own. Ms Ramnani was engaged to assist in the conduct of presentations and preparation of reports and commenced on 19 April 2004.

13 On commencement Ms Ramnani was paid $38,000 per annum and was responsible for the Gunnersen Inspirations Account.

14 In July 2004 Ms Ramnani was also given responsibility for the Trade Kitchens account. Her salary was increased by $5,000 to $43,000 per annum.

15 As a result of issues concerning presentations made by Ms Ramnani that were raised with Ms Awali by a senior representative of Gunnersen, Ms Awali had a meeting with Ms Ramnani on 1 September.

16 Ms Awali had determined to remove Ms Ramnani from the Gunnersen Account but leave her on the Trade Kitchens Account.

18 Ms Awali maintained that Ms Ramnani essentially refused to accept the position and resigned and walked out of her office and also announced her intention of resigning to the staff present.

19 Ms Ramnani maintained that it had not been her intention to resign, that she was upset and that it was Ms Awali who asked for her resignation in writing.

20 A subsequent phone call between the parties on 8 September 2004 did not resolve the issue.

21 Ms Ramnani sought monetary compensation in lieu of reinstatement or re-employment.

22 There were various issues and incidents raised by both the applicant and the respondent in their written and oral evidence which I do not consider to be particularly relevant or of sufficient weight to warrant any specific reference.

23 Nevertheless all evidence has been carefully considered and only those issues and events I consider of any relevance to the central issue of whether Ms Ramnani was terminated, resigned or was constructively dismissed and if any such termination/constructive dismissal was so harsh or unfair or unreasonable (or any combination thereof) so as to warrant the intervention of the Commission.

24 The main disputed issues between the parties were as follows:

s Whether Ms Ramnani misled Ms Awali in her Curriculum Vitae in not making clear that she had not in fact completed her qualifications. s Whether Ms Ramnani initiated the request to be given the Trade Kitchens Account and also asked for a $5,000 wage increase. s Whether Ms Ramnani's workload was excessive. s Whether during the meeting between Ms Ramnani and Ms Awali on 1 September negative performance issues were raised by Ms Awali. s Whether Ms Awali told Ms Ramnani that she was being taken off the Gunnersen Account with another employee being taken on, but she would retain the Trade Kitchens Account with a consequential $5,000 reduction in salary. That if she didn't accept that position she could resign, and give her resignation in writing. s Whether Ms Ramnani refused to accept removal of the Gunnersen account, became emotional and essentially walked out, told staff she was resigning, deleted emails, packed her personal belongings and left the premises.

25 Ms Ramnani maintained that at the initial interview she had told Ms Awali that she had not completed her interior design studies and would be attending TAFE on Wednesday nights.

26 She was also aware of the requirement of having a motor vehicle (mentioned in the position advertisement). She initially borrowed cars belonging to family members and later purchased a car in mid June.

27 Ms Awali in contrast maintained that she was never told about the ongoing studies and that Ms Ramnani's CV was expressed in such a way that it put forward that the Diploma had been completed.

28 In addition the lack of a personal motor vehicle, (which was not communicated to her), created logistical problems as there were occasions when Ms Ramnani had to be provided with a taxi to get to presentations.

29 Ms Ramnani during the course of her employment experienced difficulties with what she regarded as an excessive workload. In addition to what was involved in arranging and giving presentations she had materials, equipment and catering supplies that had to be conveyed by her to the presentations.

30 Ms Ramnani also had to organise to go out and get the clients. Whilst Ms Sultan assisted with logistical and administrative support she did not assist in the actual presentations.

31 However it was Ms Sultan's evidence that she did initially accompany Ms Ramnani on presentations and gave assistance.

32 Ms Ramnani was doing 5 presentations a month which she considered was in accordance with her job requirements. She did not agree with Ms Awali's contention that what was required was 5 presentations "per client" per month.

33 Ms Awali in contrast indicated that she herself did 10 - 12 presentations per month which included 8 presentations interstate.

34 This was supported by Ms Sultan who also indicated the requirement and expectation was for 5 presentations per client per month. She assisted Ms Ramnani with the preparation for the presentations.

35 Presentations would be scheduled at an Architects/Developers' office and would be held in some instances consecutively and be of 15 - 20 minutes duration and 10 minutes apart. Ms Sultan would schedule the presentations as per the requests of Ms Ramnani.

36 On 14 July 2004 there was a discussion between Ms Ramnani and Ms Awali about a new account - the Trade Kitchens' account.

37 According to Ms Ramnani it was Ms Awali who approached her following their visit to Trade Kitchens and asked her if she wanted to take on the additional account. It was explained that because there was a "cross-over" in the nature of the Trade Kitchen products with the Gunnersen's range this would essentially mitigate the extra workload. Ms Awali also offered her an extra $5,000 to take on the extra account.

38 However Ms Awali deposed that this was not what happened saying that it was Ms Ramnani who asked her if she could take on the Trade Kitchens account. Whilst Ms Awali said she was "impressed by her enthusiasm" essentially she was concerned as to whether she could handle the extra workload and said as much.

39 Ms Sultan also maintained that Ms Ramnani had told her that she had asked for the Trade Kitchens account.

40 Ms Awali also maintained that it was Ms Ramnani who asked for an extra $5,000 if she took on the Trade Kitchens account. She was not happy with her current salary given the Gunnersen's workload. This was considered by Ms Awali and agreed to.

41 Ms Awali also said she told Ms Ramnani that because the two companies were competitors, she couldn't present their products to the same designers.

42 Ms Ramnani denied that she was told anything of the kind by Ms Awali during the discussion, and that in fact it was she who alerted Ms Awali to the fact that Gunnersen and Trade Kitchens were competitors, and that Gunnersen should be told she was being given both accounts. Ms Awali responded by telling her it was "none of Gunnersen's business, it was Specix's"

43 Ms Awali sent an email to Ms Ramnani (dated 2 July) which confirmed she now had the two accounts, the $5000 salary increase as from 15 July but which also stated that she was not to mention to Gunnersen or any other client that she now had two accounts.

44 She was also told by Ms Awali that she was not to disclose her salary to Janelle Sultan and that this was private and confidential.

45 Once Ms Ramnani had the two accounts there were occasions when she booked presentations for both Gunnersen and Trade Kitchens in consecutive time slots, albeit 10 minutes apart.

46 This was apparent during cross-examination where she was taken to the monthly reports for August for both Trade Kitchens (Exhibit 3) and Gunnersen Inspirations (Exhibit 4) and comparison of specific dates which showed the two presentations following each other. Examples detailed were 11 August - BKA Associates and 12 August - John Associates.

47 Ms Ramnani conceded that whilst representatives from both accounts would not have been present during each others presentation, Gunnersen's representatives on the two dates referred to could either have still been present just prior to the Trade Kitchens account presentation on 12 August (Gunnersen - 1.10pm, Trade Kitchens 1.40pm) or just after on 11 August (Trade Kitchens - 10.20am, Gunnersen -10.55am)

48 Ms Awali said she was not aware that this was happening and would have stopped the practice had she known of it.

49 The first time she became aware of the situation was at a Multiplex presentation on 12 August. It was a mini Trade Show and when she became aware that Ms Ramnani had both accounts materials displayed she told her to put away the Trade Kitchens material.

50 Ms Ramnani maintained that the mini Trade Show was organised by Ms Awali and that 5 Specix accounts were on display.

51 Ms Ramnani also maintained that Specix would have been well aware of how she was scheduling her presentations, as Ms Sultan was the one who made all the arrangements after she confirmed her dates with her.

52 Ms Sultan agreed that she was the one who did the bookings for the presentations after Ms Ramnani told her she needed to see these people. To assist her, Ms Sultan would book twice in one day to save her going back on another occasion.

53 No-one raised with Ms Sultan that booking both accounts on the same day to the same group of people and within a short period of time was a problem. Ms Sultan considered that the two accounts were not directly the same as she had dealt with them.

54 Ms Sultan also said that architects were busy people and more than happy to see as many products as they would on one occasion.

55 Whilst there was a diary in the office in which each person wrote appointments, Ms Sultan could not recall how much detail was shown in such entries.

56 Ms Ramnani conceded that there were a couple of occasions when she was late to work but maintained she always worked back beyond 5.30pm most days.

57 She was also late in finalizing the required monthly reports in August due to her workload and went into work on a Saturday, at Ms Awali's suggestion, to complete the reports. Ms Awali was also present.

58 Ms Awali said she was concerned about Ms Ramnani's lateness and working outside normal office hours. She considered this counter productive and it also affected staff morale. She sent her an email warning her about lateness in early August.

59 Ms Awali was also concerned that Ms Ramnani was having difficulty with the workload and prioritising tasks. Ms Awali said she had to assist her with the August reports which were two days late.

60 Ms Ramnani generally considered that she worked very hard but that the workload was becoming difficult. This was exacerbated in late August (26) when Ms Awali requested that she do 5 presentations over the following week (compared to the 5 per month she normally did) for the new Nevamar range for Gunnersen.

61 Ms Awali said this was not her requirement but that it was requested by Gunnersen at a meeting at which Ms Ramnani was present. The presentations were to take place within a two week time frame including the preparation time.

62 There were monthly meetings with senior sales representatives from Gunnersen. At these meetings, Ms Awali said they raised issues with Ms Ramnani about being more aggressive in promoting their products. This was conceded by Ms Ramnani.

63 Ms Ramnani considered that apart from the issue of being more aggressive she was working hard on the Gunnersen's range and there were no other issues raised with her performance.

64 However she was finding it difficult to cope with the workload of the two accounts together with the additional workload required for the Nevamar presentations.

65 Ms Awali deposed that on 29 July she asked Ms Ramnani to come and have coffee with her away from the work place so that she could discuss issues of lateness and personal phone calls. Ms Ramnani raised issues in her personal life causing her stress and anxiety. Ms Awali maintained she gave a verbal warning to Ms Ramnani to "change her attitude and refocus her priorities"

66 That this informal meeting took place was not denied by Ms Ramnani - it was not referred to at all in her evidence or cross-examination.

67 On 31 August, after she had had to carry out 3 presentations in the one day, she asked Ms Awali if they could discuss her workload. A meeting was scheduled between them on Friday 3 September for this purpose.

68 Ms Awali deposed in relation to Ms Ramnani's request, that it was now clear to her that she was having difficulties with her workload and Ms Awali decided to take one of the accounts away from Ms Ramnani.

69 On 31 August Ms Ramnani was conducting a Gunnersen presentation for a number of Architects. Mr David Fletcher, the Gunnersen National Specification Manager, was present.

70 It was Ms Ramnani's evidence that after the presentation one of the architects approached saying he was mainly involved with polyurethane kitchens and was after a more suitable product than the Gunnersen product and Ms Ramnani suggested a Trade Kitchens product.

71 On 1 September Ms Awali was telephoned by Mr D'Souza, the Gunnersen State Sales Manager, in relation to the presentation the previous day.

72 Ms Awali was advised that Ms Ramnani had suggested to the buyer in the presence of the Gunnersen's Specification Manager that a competitor's product be purchased in preference to the Gunnensen product.

73 Mr D'Souza went on to say that the company had lost confidence in Ms Ramnani's ability to promote their product and would be reviewing their association with Specix. Ms Awali apologised and said she would take steps to ensure it would not happen again.

74 Specix was a major client and responsible for 45% of the business's income. The project concerned in the presentation was not a small one. It involved 101 home units..

75 Whilst Mr D'Souza did not put to Ms Awali in implied terms that he wanted Ms Ramnani off their account, he was clearly upset and conveyed that message to her.

76 Ms Awali considered that Ms Ramnani should not have suggested the Trade Kitchens product in front of the Gunnersen's representative but could have arranged to talk to the particular architect later. Her prime responsibility was to Gunnersen, not the architect.

77 Ms Ramnani said she was just trying to assist the architect and agreed that in hindsight she could have handled the matter more appropriately.

78 Ms Awali subsequently was sent an email by Mr D 'Souza confirming the incident, its unacceptability and requesting Ms Awali take action accordingly.

79 However as conceded in cross-communication the email was sent on 29 October following Ms Ramnani filing her application and the first listing of this matter. Ms Awali said she sought written confirmation of Mr D'Souza of his telephone communication with her on 1 September.

80 As the telephone call she received from Mr D'Souza on 1 September occurred whilst she was in the middle of a presentation with Ms Ramnani and Ms Wu she told her that they were going to have to have a talk when they got back to the office.

81 Ms Awali had decided to advise her that she was re-allocating the Gunnersen account to both alleviate her workload and address the loss of confidence by the client.

82 Ms Ramnani said she was called to a meeting with Ms Awali on 1 September and only given two hours notice of the meeting and had to do a presentation in the meantime.

83 Ms Ramnani said that the meeting took place in the boardroom but because of incomplete construction work there were no glass panels in place only the framework. Other staff in the outer office were about 5 metres away and would have overheard the conversation.

84 She was told that Mr Fletcher from Gunnersen had overheard her recommending a Trade Kitchen product and complained about it.

85 Ms Ramnani deposed that she was shown 2 sheets of paper to read. Ms Awali refused to give her copies of the papers.

86 Various comments about her were included such as:

s She was continually late, even after being issued with a written warning. s She had a haircut on a day she was sick. s She lacked confidence and this hindered her ability to do the job. s She couldn't multi-task. s She bought coffee in the morning. s She was dishonest (no explanation was given of this).

87 Whilst Ms Ramnani said she agreed with some points she also believed some of the issues were unfair and untrue.

88 Ms Awali denied she showed Ms Ramnani any such paper or raised any of these issues.

89 Ms Ramnani was told about the complaint by Gunnersen but said she wasn't given any opportunity to explain the circumstances.

90 Ms Ramnani asked if she could redeem the situation with Gunnersen but was told someone else had been employed to take on the Gunnersen account and that she would keep the Trade Kitchen account and go back to her original salary. This was put on a "take it or leave it" basis. Ms Ramnani told Ms Awali that both those options were unacceptable.

91 There was some to-ing and fro-ing between them and Ms Awali re-iterated the Trade Kitchens offer and asked what she was going to do.

92 Ms Ramnani deposed that at this point she was "furious" and said words to the effect of "I could not remain for another minute". She said that "in the heat of the moment" she went back to her desk, packed her belongings and decided to delete her personal emails.

93 She asked Sharif Hamawi to help her carry Specix property out of her car to her office. On her return Ms Awali asked for her mobile phone and a written resignation.

94 Ms Awali maintained that Ms Ramnani didn't seem to appreciate that she had placed the Gunnersen's account in jeopardy or that she had done anything wrong.

95 She told her she was giving the Gunnersen account to another staff member so she could concentrate on the Trade Kitchens account. This was to ensure Specix did not lose the Gunnersen account.

96 However this was rejected by Ms Ramnani who said she had worked too hard and if she couldn't have both accounts she didn't feel she could work there and keep her head high in front of other employees. In order to keep her dignity she had to leave the firm.

97 Ms Awali also maintained that nothing was said or proposed about a reduction in Ms Ramnani's salary.

98 Ms Ramnani then walked out and announced her resignation to the staff and turned and told her she would email her resignation later.

99 Ms Awali did not receive any written resignation and did not hear from her until the 8 October when she rang to apologize and wanted to discuss her conditions.

100 Ms Awali told her she had already resigned, someone else had been brought in two weeks early but that she could still have the Trade Kitchens account if she wanted it.

101 A meeting was attempted to be arranged but Ms Awali was going to be interstate and Ms Ramnani then said she was considering unfair dismissal action.

102 Ms Ramnani said that after she left Specix on 1 September she contacted her employment officer who advised her to take a couple of day's sick leave and contact Ms Awali when she felt fit.

103 When she did contact Ms Awali on the 8 October she said she couldn't meet her due to the increased workload she had left them. The Trade Kitchens offer (with pay reduction) was reiterated.

104 It was Ms Awali's contention that she never wanted Ms Ramnani to leave. It would have been at a difficult time with the Nevamar presentations due to be given the following week. She had had to do that work herself.

105 Ms Awali said that a position for another new account - the Svenska account (a textile fabric company) had recently been advertised, interviews undertaken and the position filled. One of the persons interviewed but unsuccessful was still looking for work and was contacted by Ms Awali to take on the Gunnersen account after Ms Ramnani's departure.

106 The staff present in the outer office on the 1 September all gave evidence - Janelle Sultan, Sharif Hamawi and Belinda Wu.

107 None of the witnesses could hear what was being said between Ms Ramnani and Ms Awali in Ms Awali's office. All essentially confirmed in evidence that voices were heard but details of the conversation could not be heard.

108 Whilst there was some slight divergence in exactly what was said and the order of events, all confirmed that Ms Ramnani went to her desk, could be clearly seen deleting emails and packed her personal belongings.

109 Ms Ramnani then appears to have turned and said she would send her resignation by email, directing what was said to Ms Awali. Comments were also made by her about how it was nice working with them and wishing them luck and she then left. Mr Hamawi went with her to the car.

110 Ms Sultan said she had her back to Ms Ramnani when she came out of the Boardroom and couldn't remember how she looked (i.e. upset etc)

111 There was a divergence between what was contained in the witness statements of these three witnesses (Exhibits 8, 9 and 10) and statutory declarations (undated) sworn in 2004 and tendered during conciliation proceedings on 1 November 2004. (Exhibits 11, 13 and 12)

112 Cross examination about those statutory declarations and a comparison with the witness statements essentially focused on the fact that the earlier documents were more detailed. They all had Ms Ramnani announcing in some form that she resigned voluntarily.

113 Ms Sultan said she packed her belonging and then deleted emails. Ms Wu only referred to packing her belongings. Mr Hamawi said she deleted emails then packed her belongings.

114 The three witnesses generally maintained that these declarations were done when events were fresher in their memory. It was apparent that they had not been looked at again prior to preparation of the witness statements in April this year.

115 What was clear from all these witnesses was that they did not hear the exchange between Ms Ramnani and Ms Awali in the boardroom and who said what and to whom.

116 Ms Ramnani maintained Ms Awali asked her to put her resignation in writing.

117 Ms Awali said she could not recall doing that only that she asked for the phone to be returned as it was a company phone.

118 Only Ms Sultan made any mention of Ms Awali asking her to hand in her resignation letter with Ms Ramnani responding that she would do that by email. (Exhibit 11). Ms Sultan's witness statement (Exhibit 11) only referred to Ms Ramnani saying she would email her resignation.

119 Since her employment with Specix ceased on 1 September 2004, Ms Ramnani had completed her TAFE course between September 2004 and December 2004, at night.

120 She undertook additional skills training in January. She applied for various small jobs but was unsuccessful.

121 On 15 April she took up employment in a Sales Support role with a company where she is earning $35,000 per annum during her trial period with an increase to $40,000 on successful completion of that period on 14 July 2005.

122 Ms Tucker for the applicant submitted that the central issue for determination was whether the decision by Ms Awali to downgrade Ms Ramnani's duties and salary was variation of her contract such that it constituted a repudiation of the contract of employment per Clark v Pittwater RSL Club Ltd (1998) 84 IR 3D9 and British Aircraft Corp Ltd v Austin (1978) IRLR 332.

123 Repudiation of the contract of employment is noted in the NSW Industrial Law Service (Butterworths, at [83.50.40]) as follows: "To constitute a breach of this implied term [that an employer will not, without reasonable and proper cause, conduct itself in a manner calculated or likely to destroy or seriously damage the relationship of confidence and trust between employer and employee] it is not necessary to show that an employer intended any repudiation of the contract. Instead, the commission will look at the employer's conduct as a whole and determine whether it is such that its effect, judged reasonable and sensibly, is such that the employee cannot be expected to 'put up with it'."

124 In addressing this issue it was submitted there were five relevant considerations. 125 1) The role for which Ms Ramnani was engaged. When Ms Ramnani was employed her role was to promote the Gunnersen range of products and this was her focus of work as confirmed in evidence of both applicant and respondent.

126 Ms Ramnani dedicated four and half months to developing sales contacts for this major client and income earner for Specix. This indicated the significance of her removal from the account.

127 Apart from a request that she be more aggressive in her sales no other problems were raised in her handling of this account prior to the 31 August.

128 Her removal from the account constituted a significant diminution of her duties and was a fundamental variation in her terms of employment.

129 2) The significance of the variation of the contract. The variation proposed was a significant one for Ms Ramnani. She was confronted with Gunnersen concerns followed by a list of other performance issues. She was told she would no longer be working on the Gunnersen account, only the Trade Kitchens account with a reduction in salary or she could resign. It was a "take it or leave it" option.

130 Such a variation in her contract of employment presented in that manner constituted either a dismissal or, alternatively Ms Ramnani's departure from Specix could be "construed" as a constructive dismissal as she was given no option but to leave.

131 3) The justification for the variation of the contract. The alleged justification for the decision of Ms Awali to vary the terms of Ms Ramnani's employment was purported to be due to the complaint from Gunnersen about the presentation on 31 August and the promotion of a Trade Kitchens product to an architect. However whilst Ms Awali alleged Gunnersen made it clear they expected Ms Ramnani to be removed from the account there was no evidence to support this or to indicate what "action accordingly" meant in the email from Mr D'Souza sent more than a month after the relevant dates and after conciliation had commenced.

132 The conflicting evidence about who initiated the handling of both accounts was not relevant, as Ms Awali was responsible for allocating the Trade Kitchens account and for addressing any potential conflict. This is evidenced by the email of 2 July from Ms Awali. That email only referred to a concern that clients didn't find out Ms Ramnani was handling both accounts. It would have taken little effort for Ms Awali to make clear what was expected.

133 Further it was submitted that the suggestion that the two account ranges were complimentary suggested Ms Ramnani's actions of 31 August in proposing a Trade Kitchens product when it had been established that there was no suitable Gunnersen product for the client.

134 Whilst Ms Ramnani had acknowledged that in hindsight there were better ways she could have handled the situation, the respondent had not shown that its actions in removing her from the Gunnersen account were either required by them or justifiable.

135 In relation to being on notice of the need to keep the two accounts entirely separate as asserted by Ms Awali, this arose from concerns she asserted had been raised at a mini Trade Show. The reasons were advanced of not confusing architects with both ranges shown on the same day and the likelihood of Gunnersen becoming aware she was handling both accounts.

136 The first reason was in conflict with the evidence of Janelle Sultan who said architects would prefer the convenience of seeing various ranges on one day. In addition Ms Sultan was fully aware of the nature of the two accounts and did not consider there was conflict and regularly booked presentations for both on the same day.

137 As to the second reason, it was for Ms Awali to ensure clients were aware of how Specix was dealing with the two accounts and deal with any conflict, not to place Ms Ramnani in an untenable situation.

138 It was submitted that the requirement that Ms Ramnani be secretive about her work, yet be able to go behind Gunnersen to the architects later and recommend a Trade Kitchens product, suggested a level of duplicity was required of her. Whether or not this had been satisfactorily communicated to her, her failure to comply meant she was made to suffer the consequences in relation to her contract of employment.

139 4) The events of 1 September at the Specix offices. Ms Ramnani was emphatic in her evidence that she did not resign or announce her resignation or say she would email her resignation. It was Ms Awali who asked for her written resignation after she came out of the boardroom.

140 Whilst her evidence was that she deleted personal emails and left the building that day this was in the context of being in a state of distress, having been pushed to accept demotion or resign.

141 The conflict in evidence between Ms Ramnani and Ms Awali and the importance of their exchange in determining whether Ms Ramnani was dismissed, forced to resign or voluntarily resigned required the evidence of the parties to be scrutinized.

142 Ms Ramnani's evidence had remained consistent whereas the evidence of the respondent contained many contradictions. It was also pointed out that Janelle Sultan was Ms Awali's sister and Sharif Hamawi her brother.

143 Whilst Ms Awali denied she asked Ms Ramnani to hand in her resignation, this was contradicted in evidence by Ms Sultan. The Statutory Declarations (Exhibits 11, 12, 13) and Ms Awali's evidence had Ms Ramnani coming out of the meeting announcing her resignation and then packing to leave. However the affidavits of the respondent's staff members had Ms Ramnani leaving the meeting, packing her things and then announcing her resignation.

144 It was submitted that the parallels in the respondents' evidence not only diminished its weight but also raised the suspicion of collusion to shore up the respondent's evidence. The coincidence of the evidence in the three statutory declarations and three subsequent affidavits was unlikely.

145 Given these concerns it was submitted that the evidence of the applicant was to be preferred.

146 Further, Ms Ramnani's account of what occurred on 1 September was confirmed by the letter of Ms Bunt as annexed to Exhibit 1.

147 5) Action of the parties post 1 September. It was not contested that neither side made any attempt to contact the other. At no stage did Ms Awali seek to contact Ms Ramnani and whilst Ms Ramnani did seek a meeting a week later this did not occur.

148 It was Ms Awali's evidence that she wanted to create a role for a new employee, Kate Bonselaar, who was subsequently given the Gunnersen Account. This further suggested that Ms Awali had intended that Ms Ramnani leave Specix.

149 It was further submitted efforts to discredit Ms Ramnani that only served to indicate the respondent had sought to justify its actions after the event. The alligations concerning the applicant's assertions at her job interview were unsustainable and suggested a willingness on the part of the respondent to manufacture evidence in support of its case.

150 The contradictions in the evidence of the respondents' witnesses indicated that the respondents' account should be viewed with caution.

151 The applicant suffered considerable financial loss and a blow to her confidence due to the respondents' actions. Despite her efforts new employment was not secured for seven months.

152 Ms Ramnani was dedicated to her job. The actions of the respondent caused the situation Ms Ramnani found herself in on 31 August and she was not given any opportunity to explain what happened.

153 The action of the respondent led to the forced departure of the applicant and therefore her application for relief ought to be allowed.

154 Mr Kartsounis for the respondent submitted that notwithstanding that the applicant in submissions claimed dismissal or alternatively constructive dismissal, it was clear from the Form 7A application and the balance of the applicant's submissions that she sought that the Commission make a finding that there had been a constructive dismissal.

155 However a finding of constructive dismissal was not open to the Commission on the evidence. The correct test to apply in that regard was set out in Allison v Bega Valley Council (1995) 63IR68 at pps 72 - 73. This test was adopted by the Full Bench in Police Service of New South Wales v Batton [2000] NSWIR79 (23 May 2000) and in St Vincent's Hospital Sydney Limited v Barbara Isabella Harris [1998] NSWIRComm 235 (28 May 1998).

156 Mr Kartsounis responded to the reliance placed by the applicant on the extract from Butterworths NSW Industrial Law Service and in particular the reference to it not being necessary to show an intention to repudiate the contract. It was submitted that the proper statement of the law was to be found in Allison in the last paragraph on page 73, that is, that the ostensible resignation is consistent with the desire of the employer that such resignation be forthcoming.

157 If the Commission found that a dismissal rather than a resignation had taken place it would be necessary to find such dismissal was harsh, unjust or unreasonable per s.84. No submissions were made by the applicant on this issue. Neither reinstatement nor re-employment was sought by the applicant.

158 The five issues addressed by the applicant were responded to as follows:

159 Purpose for which Ms Ramnani was employed: The assertion that the applicant was employed to promote the Gunnersen account and that this client was hers as she had introduced it to the firm was conceded by her to be incorrect on further questioning from the Commission.

160 It was clear from the evidence that the applicant having worked on the account for 4 months had formed the view that there was a degree of prestige flowing from conducting the account. It was submitted that this was an attempt by the applicant to hold up the importance of conducting this account as the basis for the submission that removal from the account constituted a "fundamental variation in her employment contract" and also a "significant diminution of her duties".

161 The employment agreement covering the applicant was relied on (as attached to Ms Awali's affidavit). Although initially given that account, the position description was of "Specification Sales/Marketing Co-ordinator". The "job requirements" stated, " the role is not limited to the number of specification clients that the co-ordinator is managing". No reference was made to handling one specific account only.

162 It was conceded by the respondent that the evidence showed the applicant demonstrated a great deal of pride in conducting the account but this gave her a degree of self-importance beyond her experience. She was expected to perform the role set out in the employment agreement.

163 The dispute in evidence as to who initiated the taking on of the Trade Kitchens account and the increase in salary was referred to. However notwithstanding the applicant's contention as to the version of events it was not contended that the taking on of another account amounted to a fundamental variation of the contract of employment.

164 It was also submitted that if Gunnersen dispensed with the services of Specix it would not make the applicant's position redundant.

165 Significance of variation for Ms Ramnani. The respondent denied the applicant's assertion that removal from the Gunnersen account would involve a reduction in salary. This was tested in cross-examination and remained undisturbed.

166 It was submitted that removal of the Gunnersen account from the applicant did not constitute a demotion in that she was not being asked to perform lower level duties, but merely asked to do the same job on a different account. These circumstances were distinguishable from that involved in Sparrow v Little t/as Milk Plus (1998) 78IR365 (at 366) where the Full Bench of the South Australian Commission found that the change in duties was of such magnitude as to alter the employment contract. It was a substantial repudiation of the contract that entitled the appellant to end the relationship.

167 In this matter there had been no change in duties merely a change in accounts. The same work would be performed.

168 If the Commission found for the applicant in relation to the salary reduction and reversion to the original salary then again that could be distinguished from the facts and finding in Sparrow v Little on such issue.

169 In this matter the reduction in salary was 13% being the $5000 increase given over and above the starting salary of $38000 to reflect the extra work and responsibility in conducting two accounts.

170 Aside from the disputed issue of the salary reduction it was agreed on the facts that the applicant was struggling with the workload, and was not coping. This would have been exacerbated by the additional account. This occurred in the context of the applicant's lack of experience and qualifications in the industry. She had only been at the firm 3 months before being given/accepting extra responsibility and money.

171 It was submitted that any alleged reduction in salary and commensurate relief of workload could be deemed to be the responsible response of the employer to the "too much too soon approach" which may have been premature for the employee.

172 The applicant had contended she had been pushed to take the Trade Kitchens account and had not wanted more work, and was happy with the money yet claimed to have been given an ultimatum to go back to a lesser workload and money or resign.

173 It was submitted that the applicant's pride was wounded at having lost the Gunnersen account and this was the "real and effective" initiator of the termination rather that the conduct of the respondent. The applicant in a "fit of pique" voluntarily decided to terminate the employment relationship by resigning. There was no fundamental variation in the applicant's terms of employment.

174 As to the justification for the decision of Ms Awali, it was made clear that the headings used by the applicant in her submission were used for ease of reference but the content was not adopted.

175 There was no clear and persistent attempt to vary the employee's condition of service, as was the case in Police Service v Batton. Whilst the applicant made reference to the significance of the variation to her employment, it was simply a matter of the respondent dealing with a situation that whilst the respondents' business was being adversely affected the applicant could not be permitted to do anything to damage the respondents' business further. The relationships with clients were valuable ones and the respondent was entitled to take such reasonable steps as required to regulate the relationship with the applicant to preserve the respondents' business.

176 Actions of the applicant had damaged the respondents' relationship with a client. It was not simply a whim by the respondent but a response to actual complaints.

177 Reliance was placed on the common law obligation of uberrimae fidei that is that in the employment an employee is obliged to act in good faith and as part of that obligation not do things that will deprive an employer of business or clients.

178 The applicant had sought to downplay the Gunnersen complaint and suggested the respondents' concerns were manufactured. The Commission could observe the demeanour of the respondent, and it was submitted she was consistent in her evidence. No alternative explanation had been advanced as to why the issue caused such concern to the respondent. The applicant also conceded that in hindsight the situation could have been handled better.

179 The applicant's submissions sought to discredit the respondent through its interpretation of what made commercial sense in an industry that is fundamentally involved in advertising. Further it was "unhelpful and mischievous" to suggest the respondent involved the applicant in a level of duplicity.

180 In relation to the events of 1 September, notwithstanding the applicant's contentions, there was no adequate explanation for her clearing her desk and deleting emails.

181 Whilst the applicant contends she was pressured into leaving it was the respondents' contention that she refused legitimate directions to relinquish the Gunnersen account and abandoned her employment.

182 There was no obligation on the respondent to consider the applicant's request a week later to discuss the matter and reinstate, as the respondent had justifiably turned its mind to its business and replacing the applicant.

183 The respondents conduct as a whole did not give rise to any act or omission that would constitute unfairness, harshness or unreasonableness in relation to the applicant. The application should therefore be dismissed.

184 Ms Tucker in reply rejected the respondents' submission that the applicant had sought to misrepresent her position in relation to the Gunnersen account. This was clear from the transcript. Further, the respondents own evidence made clear the importance of the Gunnersen account.

185 On the issues raised concerning the meeting of the 1 September the respondent had misconstrued the applicant's evidence. She had no objection to continuing the work for which she was employed, being the Gunnersen account. To be relegated to the minor Trade Kitchens account would have been a significantly different workload, from that previously undertaken for Gunnersen.

186 The respondents' submission referred to "actual complaints by customers" yet no evidence apart from the Gunnersen email was adduced to support this.

187 Finally the respondents' submission about the circumstances of Ms Ramnani's leaving were contradicted by the evidence of Ms Sultan who stated Ms Awali asked the applicant for her resignation.

188 I have carefully considered the evidence and submissions of the parties in this matter.

189 There are a number of issues of disputed facts/events that need to be addressed. However some of those issues have no substantial bearing on or relevance to the central issue I must determine. That issue is whether Ms Ramnani was dismissed, voluntarily resigned or was constructively dismissed and if a dismissal occurred whether it was so harsh or unjust or unreasonable (or any combination thereof) so as to warrant the intervention of the Commission.

190 Some of those facts/events may go to the credibility of either the applicant or the respondent (or both), but again even issues of credibility may not be of sufficient relevance or weight to be factors to be taken into account in determining what effectively happened and resulted on 1 September and how the ending of the employment relationship between the parties may be characterized.

At a glance

Court

Decision date

Before

Source

Judgment (292 paragraphs)

Parties

Cases Cited (7)

Cited By (2)