Termination of employment - jurisdiction - whether applicants dismissed or resigned - principles of constructive dismissal - inherent contradiction in applicants' claims - no conduct of employer to force resignations - no dismissal of applicants - Small Business Fair Dismissal Code could not apply - no jurisdiction - applications dismissed.

[1] Mr Lance Gunther and Ms Michele Daly ('the applicants') were both employed as live-in Assistant Managers of the Easts Riverside Holiday Park Pty Ltd (the 'Park / respondent') in Batemans Bay, New South Wales. The Park has 90 sites comprising 38 cabins and 52 caravan and camping sites. The applicants commenced working at the Park on 17 March, 2009 according to an employment agreement, dated 6 April 2009, which required them to be employed (and remain employed) together as a Management team. At the relevant time there were five full time staff engaged at the Park; namely Mr Brad and Mrs Cheryl Melouney, the Managers (to whom the applicants reported), Mr Don Moran (Groundsman) and the applicants. In addition, 8 casual cleaning and maintenance staff were also employed.

[2] It is convenient, at this point, to give a brief background of the circumstances surrounding the applicants' terminations of employment, as the respondent maintains that the applicants were never dismissed, but resigned of their own accord by abandoning their employment.

[3] The applicants commenced 2 weeks annual leave on 25 February 2011. On 1 March, Mr Gunther rang the Park requesting copies of his payslips and rental arrangements as he was seeking a loan to buy a new Harley Davidson motorbike. Mr Melouney was unavailable at the time and rang back later. He requested Mr Gunther attend a meeting with him, either before returning from holidays, or after he got back on 9 March 2011. It was in this phone call that Mr Gunther claimed he and Ms Daly were dismissed by Mr Melouney. I shall come back to the details of this phone call later. Both applicants did not return to work due to workers' compensation claims of stress and anxiety. However, on 4 June 2011, the applicants, with their son, attended the Park to retrieve their belongings from their live in cabin. They did not speak to anyone at the time and there is a dispute as to whether this was the date the respondent claims was when the applicants abandoned their employment.

[4] On 16 June 2011, Mr Gunther emailed Mr Melouney, giving one week's notice of their resignations. This email reads as follows:

As you have not responded to our e-mail of 13/6/2011 & on the advice of WorkCover nsw [sic], fairwork australia [sic] & our solicitor we find it necessary to make further contact in order to officially give you 1 weeks notice effective as of today, 16/6/2011 with the date of termination being 23/6/2011.

Please do not regard the collection of our personal property on 10/6/2011 as a resignation in any form. Our presence at your park on this day was merely the retrieval of belongings & not a resignation & inasmuch should not be interpreted as such [sic].

A full & formal letter of forced resignation will be forthcoming.

Please regard this correspondence to be also a formal request that all outstanding accrued leave entitlements be met at your earliest convenience either by way of electronic funds transfer or cheque addressed to...[applicant provided address].

We would greatly appreciate some form of response to this e-mail'.

[5] On 24 June 2011, Mr Gunther sent a 6 page closely typed letter headed 'Letter of Resignation' to Mr Melouney in which he asserted their forced resignations and gave details of many complaints against Management and about the Park's operation. The applicants claimed they had been constructively dismissed. On 5 July 2011, the applicants each filed an application for an unfair dismissal remedy under s 394 of the Fair Work Act 2009 (the 'Act').

[6] The following persons gave written and / or oral evidence in the proceedings:

Mr Donald Moran - full-time employee - Groundsman

Mr Brett Grundy - casual employee - maintenance / cleaning

Ms Helen McFarlane - casual employee - receptionist

[7] Mr Gunther is 55 years of age and has worked in various skilled and semi skilled jobs since leaving school. He and Ms Daly worked as the Managers of the Hibiscus Motel in Bryon Bay for 14 months before commencing employment with the respondent. He described his job as involving all aspects of the caravan park industry - from front office to ground keeping, maintenance, cleaning, interacting with guests and security. He worked a nine day fortnight from 7:30am to 9:30pm. Mr Gunther said that at the time of commencing employment at the Park, his health had been very good. He now suffers anxiety and depression that he alleges he sustained during his employment with the respondent.

[8] Mr Gunther outlined a number of incidents over the previous 18 months which he believed contributed to his present workplace injury. He described Mr Melouney's training during the first 6 months as very thorough and tough. He was constantly reminded by Mr Melouney as to who was the boss and that he had sacked the last two Assistant Managers for being lazy. Mr Gunther said the groundsman, Don Moran, who did not like Assistant Managers, would give him 'dirty looks', speak abruptly to him in front of guests and frequently yelled at him. He believed Mr Moran was 'spying' on him and reporting back to Mr Melouney if anything was amiss. Mr Gunther said that he never directed Mr Moran's work and despite trying to talk to him, he was either ignored or given one word responses. Mr Gunther also claimed a part time employee, Brett Grundy, often used foul language and had abused him on a few occasions. Mr Gunther had complained about Mr Moran and Mr Grundy, but Mr Melouney did nothing about it.

[9] Mr Gunther asserted that in November 2009, Mr Melouney threatened Ms Daly with direct physical violence when, after making a mistake (putting a motor home on a tent site), he had said to her that if she did it again she would 'feel my size 10 boot on your arse'. Ms Daly was ashen gray when she told him what Mr Melouney had said. When Mr Gunther confronted Mr Melouney the next day, he had generalised the comment and turned the story around to 'They will find my size 10 boot on their arse'. Nevertheless, Mr Melouney later apologised to Ms Daly.

[10] Mr Gunther complained to Mr and Mrs Melouney about another incident involving Mr Moran using the whipper snipper. They agreed it was not appropriate for Mr Moran to shout at him in front of guests. Mr Melouney made suggestions about how Mr Moran and Mr Gunther should try and get on and avoid confrontation. Mr Gunther later heard from Mr Melouney that Mr Moran and Mr Grundy had told him that he worked like a 'Trojan' when Mr Melouney was around, but 'bludged' when he was not there. In Mr Gunther's mind, this confirmed that they were both spying on him and reporting him to Mr Melouney.

[11] Mr Gunther described another incident on 22 February 2011 concerning overflowing garbage bins in the BBQ area of the Park. When he questioned Mr Grundy, he just shrugged and walked away. Ms Daly later said that soon after the incident occurred, Mr Grundy came into the back office muttering and in a loud voice said 'Fucking dog cunt'. This was heard by others in the office. Mr Gunther filled in an incident report as he wanted Mr Melouney to do something about Mr Grundy's language and behaviour. He believed Mr Grundy was 'baiting' him.

[12] On 24 February 2011, a meeting was convened by Mr Melouney involving Mr Moran, Mr Gunther and Mr Grundy. Mr Gunther said that while the meeting was intended to be about the above incident report, it turned into a discussion about him and his duties. During the meeting, Mr Melouney said that swearing would not be tolerated. Mr Grundy became agitated and said he swore because he (Mr Gunther) 'told me to get fucked'. Mr Gunther said that this was a 'bald faced lie'. Mr Grundy blew up, leaned towards him and whilst pointing his finger in his face said 'you have been niggling me ever since you've been here saying things like "good day shifty" and "conviction kitchen"'. Mr Gunther agreed that he had said these things about a community service sentence Mr Grundy had served for a prior conviction.

[13] Mr Gunther said to Mr Melouney that he was unable to communicate with Mr Grundy or Mr Moran. Mr Grundy got up and screamed 'I don't have to take this I fucking quit!' Mr Moran complained that Mr Gunther had told someone that if he was in charge, he (Mr Moran) would be the first to be sacked. Mr Gunther claimed no recollection of having said this but apologised anyway. Mr Melouney then announced that everyone was on their final notice. Mr Gunther later sought to make his peace with Mr Moran.

[14] Mr Gunther and Ms Daly commenced annual leave the next day (25 February 2011). Mr Gunther gave details of the phone call to the respondent on 1 March 2011 and Mr Melouney's return call. Mr Gunther had requested copies of payslips and rent confirmation in order to obtain a loan for a new Harley Davidson. He spoke to Ms Helen McFarlance - Office Assistant, who said she would fax him the requested documents. When they failed to arrive, Mr Gunther called back and soon after Mr Melouney returned his call. He said they needed to have a meeting to see how happy he was at work. Mr Melouney suggested that perhaps he should not go into debt until after their meeting. He asked Mr Gunther if he wanted to wait to have the meeting, until after his holiday ended on 9 March 2011. Mr Gunther believed this was an inference that 'we were facing the sack'.

[15] Mr Gunther claimed that from that point on, he and Ms Daly were 'shattered'. They self medicated with alcohol and stared into space - unable to eat or sleep. They felt sure they would be telephoned back to be dismissed. He felt disgusted with Mr Melouney and felt it was the nastiest and most unprofessional thing he had ever witnessed.

[16] Mr Gunther said he was having headaches and leg spasms and Ms Daly was regularly crying. They knew they could not perform their duties if they had to return to work, so they went to the doctor. They both saw different doctors on 8 and 9 March 2011. Mr Gunther received a WorkCover certificate for 2 weeks and, during this time, arranged counselling.

[17] As they were expected back to work on 9 March, they returned to the Park and gave their WorkCover certificates to Mr Melouney. They claimed to be not well enough to stop and talk to him. Mr Gunther said he could not speak to the Regional Managers because they were best friends with the Melouneys. The applicants both went back to a Dr Nelson on 21 March and received medical certification for another month off work.

[18] Mr Gunther gave further evidence that in October 2010 he had contacted WorkCover about the storage of flammable liquids at the Park and the licence requirements for using the 'cherry picker'. He also made a complaint of bullying by, and spying on, by Mr Melouney. He felt Mr Melouney was bullying him over criticism of his performance, allowing others to shout and swear at him and had threatened Ms Daly with violence. He said an improvement notice was issued in respect to the storage of liquids, but he hadn't pressed the bullying complaint for fear of losing his job. He was told to take notes in case his complaint went further in the future. He had taken notes since that time and attached to his statement was a document containing 8 pages of notes.

[19] Mr Gunther added that he had felt threatened by Mr Melouney's behaviour. He was 'on edge' and felt at risk of losing his job as everyone was put on notice on 24 February 2011. He said he was nervous and shaky and had vomited on occasion. He lost interest in food. There were no other problems causing his health deterioration, other than his employment. He claimed the undue and unnecessary stress at work was not properly handled by Management.

[20] In cross-examination, Mr Gunther acknowledged that one of his duties was emptying the garbage bins, yet he had asked Mr Grundy why he had not done so. He accepted that his incident report only dealt with this complaint. He denied he had been niggling Mr Grundy.

[21] Mr Gunther agreed that Mr Melouney had faxed the documents he had requested on 1 March 2011 and that in the phone call Mr Melouney was only planning another meeting to see how happy he was at work.

[22] Ms Daly is 50 years of age and has four adult sons (with a former husband) and three grandchildren. She described her work history up to her employment as Assistant Manager at the Park. Her duties at the Park included meeting and greeting guests, guest check in and out, processing internet bookings, handling enquiries, managing and supervising other staff and assisting at times in housekeeping. She said she worked 10 hours a day; 7 days on with 4 days off. Generally, her roster was the same as her partner, Mr Gunther.

[23] Ms Daly said her workplace psychological injury was due to the trauma associated with working for the respondent. She said that it was around November 2009 that she first started having problems at work. She was 'on edge' because Mr and Mrs Melouney would come into the office on their days off to check up on her.

[24] Ms Daly described the incident when she had allowed a complaining guest to park his motor home under the trees on a tent site. After she was reprimanded by Mrs Melouney, she was reprimanded again by Mr Melouney. He had said if she did it again she would 'get his size 10 boot up my arse'. When Mr Gunther came into the office he could see tears welling up in her eyes. She asked him if he would mind the office while she went outside for a cigarette to calm down. When she came back, Mr Gunther asked her what was wrong and she told him what Mr Melouney had said. She didn't want Mr Gunther to say anything in case of repercussions. However, Mr Gunther confronted Mr Melouney the next day. He told Mr Melouney he had threatened violence towards a staff member. Mr Melouney then spoke to her and said that if he had offended her, he apologised. They left it at that.

[25] Ms Daly said the rest of the 'run-ins' occurred in respect to Mr Gunther and Mr Melouney, Mr Moran and Mr Grundy. She recalled the incident when an upset Mr Grundy came into the office and said 'dirty fucking cunt' in front of Ms McFarlane. Ms Daly could hear it as well. It was loud enough for any guests to hear who may have been in the front office. Ms McFarlane said to Mr Grundy 'that's disgusting'. Ms Daly later learnt that he had apologised to her on his way out. When Ms Daly went outside, Mr Gunther confirmed he had told Mr Grundy that clearing the rubbish from the BBQ area was part of his job. However, she believed he did not do so in a rude manner.

[26] Mr Gunther filled out an incident report which Ms McFarlane had backed up. Ms Daly was aware of the meeting held on 24 February 2011 and could hear what was being said. She corroborated Mr Gunther's version of events.

[27] Ms Daly then referred to the phone call from Mr Melouney on 1 March 2011. Ms Daly repeated much of what Mr Gunther said in his evidence. However, she did not hear what was actually said by Mr Melouney.

[28] Ms Daly said she went to the doctor on 8 March because 'of the effect that phone call had on me combined with everything else that had been going on'. She felt she could not take the intimidation anymore and had had enough. She said she had always wondered what kind of mood the Melouneys would be in when she returned from her days off. They were very cool and this made her feel uncomfortable. Mr Melouney constantly said he was the boss. Mr Moran and Mr Grundy would just ignore her. She believed Mr Moran and Mr Grundy were reporting Mr Gunther to Mr Melouney and she was hurt, anxious and upset by the way they treated him. She didn't believe Mr Gunther was at fault and the problem was Mr Melouney, Mr Moran and Mr Grundy's bullying of him. In the last six months she started to feel that she did not want to be there. She loved the job and the guests, but that phone call on 1 March was 'just the last straw'. She was anxious, frustrated and 'in despair'.

[29] Ms Daly believed she could not go back to work until there was some mediation with the Melouneys and their procedures were updated. In addition, she felt that Mr Melouney needed training in handling conflict resolution and identifying bullying and harassment. She claims to have been frequently intimidated by Mr Melouney's behaviour. Ms Daly said she saw a doctor because she could not face work anymore. She was physically aching, having cramps and couldn't sleep without medication. She had never had any psychological treatment before. She believed Mr Gunther was suffering worse than her and would cover it up for her sake. They have a very good relationship and no financial problems. She has a good relationship with her 4 sons and grandchildren and the one cause of her present injury was the problems at work, in particular the attitude and behaviour of Mr Melouney and the effects that her partner's problems at work had on her.

[30] In cross-examination, Ms Daly agreed that she had not been put on final notice at the 24 February 2011 meeting. Ms Daly said that although there had been only one incident between herself and Mr Melouney, she was feeling the intimidation through her partner. She acknowledged that her employment contract stated that if one of them is dismissed or resigns, then they both have to go.

[31] In re-examination, Ms Daly believed that the incident involving Mr Melouney was an act of intimidation and harassment. She did not believe that the 24 February 2011 meeting was held in an appropriate location, considering the shouting and swearing of Mr Grundy. Ms Daly said her first reaction to Mr Melouney's phone call of 1 March 2011 was that they had been sacked at that point.

[32] Mr Melouney has had over 13 years experience in managing caravan parks. He gave details of the applicants' wages and conditions and their duties as Assistant Managers.

[33] Mr Melouney said that the first time he became aware that the applicants were sick was in a phone call from them on 8 March and when they handed him two WorkCover medical certificates, the next day. They had said 'I can't talk to you I am sick' and left the Park. He said the applicants had never previously mentioned that they had a workplace injury and they had never displayed any behaviour that made him suspect they had such an injury. As far as he knew, they both enjoyed their jobs. Mr Melouney said that his wife, on a few occasions, had spoken to Ms Daly about inaccuracies in the wages and banking. However, nothing warranted a formal warning. There were a few occasions where he had to speak to Mr Gunther about his work performance. Mr Gunther was expected to assist Mr Moran when required.

[34] Mr Melouney referred to an incident on 3 August 2010, when he was unhappy that Mr Gunther had finished work early. He had noted that incident, as he did with any issues of concern which were raised with employees.

[35] Mr Melouney gave his version of events of the meeting on 24 February 2011. He had earlier told Mr Gunther that it was everybody's job to empty the bins if they are full and not to just leave it for someone else. Mr Melouney believed that Mr Gunther should not have approached Mr Grundy about the bins. He was aware Mr Grundy had been swearing in the office and that he had later apologised to Ms McFarlane. Mr Melouney stated at the meeting that 'everyone should get on with each other and stop niggling each other'. At the end of the meeting, Mr Melouney put everyone on final notice about this issue.

[36] Mr Melouney said from his own observations, on a number of occasions, Mr Gunther appeared not to be doing his work. Nevertheless, he said Mr Gunther does do good work, but when he is away, his workload drops off and the niggling occurs. Mr Melouney also referred to the 'whippersnipping' incident and had told Mr Gunther to try and avoid conflict with Mr Grundy. Mr Melouney said 'that he had never seen Mr Gunther distressed at work or claim the job was too much for him'.

[37] Mr Melouney described the phone call to Mr Gunther on 1 March 2011. He told him that if he was thinking of buying a motorbike there were a few issues to sort out before he came back to work. Although he didn't tell Mr Gunther what the issues were, he described recent incidents where Mr Gunther had not followed procedures in respect to parking cars, a boat incorrectly parked and an incorrect booking. He said he had spoken to Mr Gunther 6 or 7 times about him allowing incorrect parking on site and he was well aware of the rules.

'Because of these problems it was my intention to dismiss both of them when they returned from holidays. They have been told from day one that if one does not work out they both go. I had never had cause to warn Lance before except at the meeting on 24 February 2011 that they were all on final notice'.

[39] Mr Melouney referred to the allegation of a threat of violence towards Ms Daly. He said that he had not made the comment in respect to any specific incident, but merely said to her that if someone was to make the same mistake over and over 'they need a kick up the arse'. He confirmed this with Mr Gunther the next day and Ms Daly had actually acknowledged that this was what he had said.

[40] Mr Melouney denied intimidating or harassing Mr Gunther by watching him from the window of his home on site. Of course, Mr Melouney said, he lives on site, but he did not sit at his window looking at the staff. Mr Melouney also denied telling anyone to spy on Mr Gunther, but he did insist that if anyone had an issue, they should speak to him about it. Mr Melouney said Mr Gunther had never complained about staff swearing at him and his only complaint was the one contained in the incident report on 22 February 2011. Furthermore, Mr Melouney said he never once mentioned to Mr Gunther that his employment would be terminated.

[41] Mr Melouney acknowledged that he would speak to Mr Gunther about work not getting done, as it was his responsibility. Mr Melouney said the only time he heard Mr Grundy swear at another worker was in the meeting on 24 February 2011. Mr Melouney also claimed that Mr Grundy reported to him that Mr Gunther had made disparaging comments about him and his wife. On 7 March 2011, Mr Grundy had asked to work at another Park, when Mr Melouney was on holidays, because Mr Gunther niggled him when he wasn't there. Mr Gunther had also printed a fake $50 note to see if Mr Grundy would pick it up. Mr Melouney pointed out to Mr Gunther that Mr Grundy could get into serious trouble if he tried to pass it.

[42] Mr Melouney denied ever bullying or harassing the applicants and they had never raised these issues with him. The allegations were completely false. He noted the additional help he had given to Mr Gunther and the fact he had never taken a sick day. He believed the stress leave claim was a pre-emptive reaction to Mr Gunther's opinion that he might lose his job. Mr Melouney noted that the WorkCover claims of bullying and harassment had been rejected by the insurer.

[43] In oral evidence, Mr Melouney said that he called the meeting on 24 February 2011 after returning the night before and having noticed that Mr Gunther had filed an incident report about the garbage bin issue. He wanted to sort it and other issues out before Mr Gunther commenced annual leave the next day. He had also wanted to address the constant niggling between the staff. After these matters were discussed, he told everyone they were on a final notice.

[44] Mr Melouney said that in the phone call on 1 March 2011 he did not want Mr Gunther to go into debt while there were unresolved issues which, if not resolved, might lead to him not having a job. These were issues in respect to Don Moran.

[45] In cross-examination, Mr Melouney made the following points.

(a) While Mr Gunther suggested that Mr Melouney's notes of the meeting on 24 February 2011 did not reflect what occurred at the meeting, Mr Melouney disagreed;

(b) the applicants had worked outside of the precise terms of their Employment Agreement, such as being 'on call'. However, that was part of the 'give and take' of the job;

(c) Mr Gunther had not complained about extra work and that this fact and his not having a sick day in 23 months, did not fit the profile of someone avoiding work;

(d) he again denied asking Mr Moran and Mr Grundy to spy for him;

(e) Mr Gunther put a number of hypothetical propositions to Mr Melouney about how he might have obtained an alleged psychological injury. Understandably, Mr Melouney could not answer;

(f) Mr Gunther had not been left in charge of the Park in more difficult circumstances, surrounding boom gate access;

(g) the 24 February 2011 meeting, was about two related issues - emptying the bins and Mr Grundy's swearing in the office. Mr Moran had previously raised the rubbish removal issue because Mr Gunther was supposed to be on site while Mr Moran's responsibility would be to take the rubbish away;

(h) Mr Grundy was a person of honesty and integrity and he accepted what he said about Mr Gunther criticising him and his wife;

(i) he had never asked Mr Moran and Mr Grundy to report on the applicants in order to establish reasons for dismissing them;

(j) Mr Grundy swore at Mr Gunther in the 24 February 2011 meeting, but he didn't poke his finger in his face. Mr Melouney verbally disciplined him later;

(k) he had not given any warnings about the niggling, but put all of them on final notice at the meeting;

(m) the issuing of a final notice about attitude was not 'a significant event' which had contributed to Mr Gunther's and Ms Daly's alleged psychological injuries;

(l) Ms McFarlane wasn't at the 24 February meeting because she wasn't involved in the incident, apart from reporting the swearing of Mr Grundy; and

(n) the respondent had complied with the Small Business Fair Dismissal Code (the Code).

[46] Mr Melouney denied dismissing the applicants during the telephone call of 1 March 2011. However from that date on he had sought advice from the Accommodation Association of Australia (AAA) as to what steps were necessary, when the applicants returned to work, to schedule meetings to discuss outstanding issues. He denied seeking any advice about dismissing them. Mr Melouney was referred to para 44 of his statement (para 38 above) but denied he had made the actual decision to dimiss them. Mr Melouney was referred to his own notes of 14 April 2011 in which he had said 'his assistant manager's position will be terminated'. Mr Melouney believed that the first step was to talk about the issues and if they could not be resolved, the next step could be dismissal. Mr Melouney agreed that none of the grounds for summary dismissal in the Code, had applied to the applicants.

[47] Mr Melouney denied threatening Ms Daly with physical violence and said he had a general conversation, which was not directed towards anyone in particular. Mr Melouney did not accept that this incident contributed to the applicants' identical diagnosis of psychological injury.

[48] Mr Melouney denied providing any confidential information about the applicants to Mr Moran or Mr Grundy. Nor did he discuss the WorkCover interviews with anyone else. In response, Mr Gunther noted that Mr Grundy had also referred to the $50 note prank matter and knew the correct date of their commencement at the Park.

[49] Mr Melouney said that on 4 June 2011, Mr Gunther came into the office and asked for his mail and Ms Daly's dossier. He didn't know what the dossier was, but it was under the pile of mail. When Mr Gunther left and walked out to his car Mr Melouney had heard him say, 'I won't be coming back'. He did not make any attempt to discourage him from walking out, because the applicants were still on sick leave until the middle of August, 2011. He said they chose to come back and pick up their belongings. Nor did he contact them subsequently to confirm all their belongings had been moved out. However, Mr Melouney agreed that some personal items had been left in the live-in premises.

[50] Mr Melouney said that on this date (4 June 2011) his wife advised the applicants that all further payments to them were to be withheld. Mr Melouney confirmed he had received emails from the applicants on 13 June 2011 and 16 June 2011, in which they denied walking out. He did not respond to the emails as he regarded them as harassment.

[51] Mr Melouney agreed that the only further contact the respondent had with the applicants was his wife's posting of the applicants' separation certificates on 19 June 2011. He believed the employer had 28 days to do so. He denied deliberately delaying the documents to frustrate the 14 day time period for filing an unfair dismissal application.

[52] In re-examination, Mr Melouney said that just because employees complained about one another, this did not mean he had asked employees to spy for him.

[53] Mr Melouney offered his understanding of the process leading to dismissal and warnings under the Code. He would have concerns about strictly applying the Code, where sensitive access to customer bookings were vital to the Park's ongoing business. In this case, he would have sought advice from the AAA as to how to handle security issues at the Park.

[54] As to the 'kick up the arse' allegation, Mr Melouney said that when he explained the context of the conversation to Mr Gunther the next day, Ms Daly had confirmed his explanation and he believed the issue was resolved.

[55] Mrs Melouney corroborated her husband's evidence and added the following of her own.

[56] Mrs Melouney worked closely with Ms Daly. She believed her work dropped off when she lost interest from around October, 2010. Mrs Melouney began to notice minor mistakes over bookings and wage sheets, her not locking the office and not replenishing the freezer. She felt that Ms Daly underestimated her abilities and felt she was holding something back. Nevertheless she was good with the guests, and while not brilliant with maths, she had done very well in developing her computer skills.

[57] Mrs Melouney eventually decided to say something to Ms Daly, although she thought that she may have been mixing 'stop smoking' tablets with alcohol or having some other personal problems. When she met her on 17 January 2011, Ms Daly told her she was having problems with her son and sister in law. Although Mrs Melouney believed that the applicants had applied for other jobs at Moruya Heads Caravan Park as Assistant Managers, Ms Daly had told her she loved the job and it was Mr Gunther who was having problems with Mr Moran and Mr Grundy. Mrs Melouney had replied that it was not all their fault. Mrs Melouney told Ms Daly to ask her or Ms McFarlane if she was unsure of something. She said thanks and hugged her.

[58] Mrs Melouney said that in February 2011 she discovered far more than the usual errors in the wages books and the credit card and cash records were wrong. She did not know where to go with Ms Daly and felt she was deceiving her when she was away, didn't care and left it to her to fix up the problems.

[59] Mrs Melouney believed that the applicants both liked their jobs and Ms Daly had never said it was too difficult for her. Mrs Melouney believed Mr Gunther was someone who liked provoking others, didn't like being reprimanded and avoided outside work. Mrs Melouney gave the following evidence which I record:

'I believe the claim is all because they knew they were to be coming back to a meeting concerning their position. There is no way we could let them get into a loan with the meeting coming up. Brad and I had decided that we would ask them about whether they had a reason if we should not give them final notice. We decided that we had picked the wrong couple for Assistant Managers. It is really hard to get a good couple who are both suitable for the work.

We expected that Lance and Michele were going to lose their jobs when we met with them on their return from holidays. I did not feel that we could safely leave the park in their hands. Unless they could really convince us that they should stay on then I felt that we could not trust them any more [sic]. If Michele was not here with Lance I feel that I could have worked with her but with Lance I think he has a negative effect on Michele and I think that was a part of why she was having problems.

When Michele and Lance came here they had nothing and we gave them all the furniture and appliances for their residence in the park. It all boils down to the meeting on 9 March that Brad had told them we were having when they came back to work. I have no doubt that this claim is all about that meeting and if they had not been advised of this meeting beforehand there would be no claim'.

[60] In oral evidence, Mrs Melouney referred to the problems Ms Daly was having at work. When they discussed her performance issues, Ms Daly would apologise and offer 'to get back to where I am'.

[61] Mrs Melouney said that she had received two emails from the applicants - the first, presuming they had been terminated and the second, indicating they were resigning. However, Mrs Melouney believed they had 'walked out' when they collected their possessions on 4 June 2011. They were paid their outstanding entitlements to that point. Two cheques were posted - one to each applicant.

[62] In cross-examination, Mrs Melouney was asked about a new computer installed in February, 2011. She said it was completely installed, trialled and tested before she needed to go and visit her sick parents. Ms Daly had received the necessary training, but Mr Gunther had not. This was because he was not required to use the new system. Mrs Melouney agreed she did not have concerns, at this point, with leaving the Park in control of the applicants. She had to leave to attend a personal emergency and Ms Daly assured her everything would be alright.

(a) confirmed that Ms Daly had told her that Mr Gunther was not getting along with Mr Moran or Mr Grundy. She hadn't been aware of any problems before this;

(b) said she had no evidence that Ms Daly had been drinking (alcohol) while on duty;

(c) agreed that the Park was required by WorkCover to update its policies in respect to bullying, but there was no evidence of any actual bullying or harassment;

(d) did not accept that her husband's issuance of a final notice in respect to niggling was actually final;

(e) was referred to para 30 of her statement (see para 59). She said no decision had been made at that stage to terminate anyone's employment. Nevertheless, she felt that she could not trust Mr Gunther any longer;

(f) accepted that there had been no misconduct by either of the applicants; and

(g) denied giving the applicants separate cheques in order to inconvenience them.

[64] As to the 1 March 2011 telephone call, Mrs Melouney said she and her husband were concerned that Mr Gunther would go into debt when there were work issues to be addressed. She did not believe her husband sacked the applicants in the phone call, nor had he given Mr Gunther final notice on 24 February 2011. She denied that any decision had ever been made to dismiss the applicants. She did not accept the phone call contributed to their psychological injuries. However, she accepted that she was not an expert in the field of psychological injury.

[65] Mrs Melouney denied that after 1 March 2011, she had been seeking advice from the AAA as to how to dismiss the applicants. There was no one they had in mind to fill their positions. Mrs Melouney confirmed that the Assistant Managers' positions had now been filled after two weeks of advertising.

[66] Mrs Melouney believed the applicants 'walked out' when they collected their belongings on 4 June 2011. She accepted she did not contact them subsequently to clarify the situation. However, this was because she didn't want more accusations thrown at her and her husband. She did not make contact again until the 19 June 2011 when she sent them their separation certificates. She had not delayed sending the certificates to frustrate the 14 day time limitation for filing an unfair dismissal claim, because they had not been dismissed. They had 'walked out'.

[67] Mr Grundy performs cleaning and gardening duties on site. Mr Grundy said he did not work closely with Mr Gunther and while he believed he had an attitude problem, Mr Gunther had not discussed anything with him about anxiety or problems at work. He had never seen him distressed at work. Mr Grundy did not work at all with Ms Daly.

[68] Mr Grundy claimed that the only time he saw Mr Gunther angry or upset was when Mr Gunther was abusing him or he gave him answers he did not want to hear. Mr Grundy referred to the incident of the overflowing bins; particularly, when he had said that it wasn't his job and Mr Gunther had told him to 'get fucked'. On another occasion, he told him he was 'shifty' and should be in a 'conviction kitchen'. He had also said things about Mr and Mrs Melouney and had also said that if he was as in charge, he would sack Mr Moran.

[69] At the meeting on 24 February 2011, Mr Grundy told Mr Melouney he had had enough of Mr Gunther's 'name calling' and 'baiting' and had told him to 'get fucked'. When Mr Gunther said he was a liar as he walked out, he told Mr Melouney he wouldn't stay in the same meeting as Mr Gunther. Mr Grundy accepted he called Mr Gunther a 'fucking dog cunt' after the garbage incident, but it was not to his face. He had apologised to Ms McFarlane because she had heard it. He claimed he had never sworn at Mr Gunther directly. However he would do so under his breath. He claimed to have never retaliated to Mr Gunther's 'name calling'.

[70] Mr Moran is 62 years of age and has worked at the Park as a Groundsman for 13 years. He had never seen either of the applicants visibly upset at work. Mr Moran believed that Mr Gunther 'did not pull his weight'. He regarded him as a bludger. He did not get on well with him. Mr Moran said he had never seen any behaviour from anyone that could be considered to be bullying, harassment or intimidation toward the applicants.

[71] He recalled two incidents where he had words with Mr Gunther - the 'whippersnipping' incident and another time when Mr Gunther questioned him about going to the tip. Mr Moran claimed that when Mr Melouney wasn't around Mr Gunther would be out of sight or in town somewhere. Mr Moran agreed that he did tell Mr Melouney that Mr Gunther had not done his work. The only occasion he had shouted at him was in the 'whippersnipping' incident, but this was because the whippersnipper was running and he was wearing ear muffs.

[72] In oral evidence, Mr Moran elaborated on his version of events in the 'whippersnipping' incident and in the meeting on the 24 February 2011. He agreed that Mr Grundy had sworn at Mr Gunther and stormed out of the meeting after Mr Gunther kept butting in on him. He accepted that the three of them had received a final warning about them not getting on with each other. He and Mr Gunther had later shook hands and agreed to 'start again'.

[73] In cross-examination, Mr Moran said that he would sometimes observe Mr Gunther come out of his house at times outside of his lunchtime and assumed he was 'hiding'. He said that when he observed Mr Gunther driving in and out of the Park 3 times a day when Mr Melouney wasn't on-site, was also what he meant by Mr Gunther was 'hiding'. Mr Moran believed Mr Gunther was a bludger, but had never said it to his face. He denied spying on him for Mr Melouney.

[74] Mr Moran said that Mr Melouney told him that the applicants had made workers' compensation claims alleging psychological injuries. He conceded he had no expert knowledge of workplace stress, but from his observation, didn't believe that it had occurred.

[75] Mr Moran said he had respect for Ms Daly and she had looked after his bird when he was away. Mr Moran denied ever shouting or raising his voice at Mr Gunther, but Mr Gunther had made smart remarks toward him. He denied resenting Mr Gunther being his supervisor. Mr Moran said there were a number of occasions when Mr Gunther had been 'off-site' when major problems had arisen that required his attention.

[76] Ms McFarlane is a part time receptionist at the Park. She provided a statement, but was unable to attend the proceedings due to a serious illness.

[77] Ms McFarlane said she had worked closely with Ms Daly in the office and performed the same duties. Ms McFarlane said she never would have guessed Ms Daly had a psychological injury as she appeared happy in her job and never said it was too difficult or demanding. She was unaware of her having any dispute with Mr Melouney and, although she knew Mrs Melouney had occasional cause to comment on the accuracy of her work, it was not anything major. Ms McFarlane found Mr and Mrs Melouney very easy to get along with. She could not understand how the applicants could claim to have been intimidated and harassed. She hadn't seen or heard of any such behaviour.

[78] Ms McFarlane commented on Mr Gunther. She said he didn't appear to be happy and was difficult to get on with. While she had no difficulties with him, she understood there were problems between him and Mr Moran and Mr Grundy. Ms McFarlane recalled the overflowing garbage incident and commented that it was 'trivial stuff'.

[79] Ms McFarlane did not believe Ms Daly was particularly close to any of her sons. She said she was not surprised by Mr Gunther's claim, but she did not believe it was genuine. She suggested that he may have persuaded Ms Daly 'to go along with it'.

[80] Ms McFarlane added that when the applicants commenced employment, Mrs Melouney obtained various household items for them, including furniture.

[81] In oral evidence, Ms Field said she was made aware of two issues regarding Mr Gunther's performance. The first concerned the 'whippersnipping' incident and the second concerned a customer who had complained about the way Mr Gunther had treated him. On another occasion, she observed Mr Gunther leaning on a shovel for some period of time.

[82] Ms Field said Mr Melouney had reported his concerns with Mr Gunther's conduct to her and her husband. However, Mr Melouney had never dismissed either applicant and, in any event, could not have done so without first obtaining her and her husband's views as the Area Managers.

[83] In cross-examination, Ms Field said that it did not matter if customers were in the wrong- they were not to be spoken to as Mr Gunther had done (in the example referred to above).

[84] Ms Field did not document any of the meetings she had had with Mr and Mrs Melouney in their lounge room, because there was no need to. She conceded that she had been very pleased with how Ms Daly had handled the new computer program. Nevertheless, Mrs Melouney had complained to her about the many errors Ms Daly had made in respect to the wages and hours worked by staff. She noted that the computer program does the math for the operator.

[85] Ms Field said that on one occasion she had smelt alcohol on Ms Daly's breath and she was very concerned that if she could smell it, so could the customers. Although it was misconduct to drink alcohol while on duty, she did not take the matter any further, because she just wanted to talk to the Manager - it wasn't as if Ms Daly was actually drunk. Even so, Ms Field conceded that, Ms Daly was capable of running the Park.

[86] Ms Field said that Mr Melouney had also reported to her of Mr Grundy's behaviour and his swearing in the office. She believed Mr Melouney acted appropriately in the matter by giving all the employees a final notice. However, she accepted that the respondent's actions were not compliant with the Code.

[87] The applicants provided the Tribunal with written submissions addressing the preliminary jurisdictional issue/s in contention and arguments in support of the substantive merits of their applications. For the purposes of this decision, it is unnecessary to develop, in a fulsome way, the submissions of the parties as to the alternate merits of their arguments. Nevertheless, they may be referenced earlier in the evidence.

[88] One leg of the applicants' case was that jurisdiction existed on the basis that they were dismissed from their employment within the meaning of s 386(1)(b) of the Act. They were forced to resign from their employment on 16 June 2011 because of a course of conduct engaged in by the respondent since 21 February, 2011. That course of conduct was as follows:

(a) On 21 February 2011, Mr Gunther filed an incident report in relation to Mr Grundy's workplace behaviour and performance, particularly after he had called him 'a fucking dog cunt'. Mr Grundy and Ms McFarlane both confirmed that these words were said;

(b) On 24 February 2011, a meeting was conducted by Mr Melouney in response to the incident report. During the meeting, Mr Grundy swore at Mr Gunther. This is supported by the evidence of Mr Melouney and Mr Grundy. At the conclusion of the meeting, Mr Melouney issued a final, verbal warning to those employees present, in respect to inappropriate workplace behaviour;

(c) The applicants contend that through the respondent's inaction, a culture of workplace bullying prevailed at the Park. They submitted that the respondent had failed in its duty to provide a safe working environment. In support of this assertion, the applicants noted that a WorkCover inspector had previously issued an 'improvement notice' in March 2011 in response to certain findings arising from the applicants' workplace bullying claim;

(d) On 1 March 2011, whilst on annual leave, Mr Gunther received a telephone call from Mr Melouney in which Mr Melouney had advised him not to enter into any financial arrangements until after he had attended a meeting with the respondent upon his return to work. Mr Gunther perceived this to mean that his employment would be terminated upon his return to work from annual leave; and

(e) On 8 and 9 March 2011, the applicants sought medical advice from separate medical practitioners and each obtained a certificate which they allege confirms that they had suffered psychological injuries, resulting from stressors in the workplace, triggered by the 1 March 2011 telephone call.

Breaches of the Small Business Fair Dismissal Code (the 'Code')

[89] If the Tribunal accepts the applicants' submission that a dismissal, within the meaning of s 386(1)(b) of the Act, did take place on or before 1 March 2011, then such a dismissal was in breach the Code. The essence of the applicants' argument was directed toward alleged breaches regarding a number of procedural matters outlined in the Code. The applicants drew the Tribunal's attention to the respondent's own evidence in the proceedings which they claim support their arguments, particularly the witness statements of Mr and Mrs Melouney and Mr Grundy.

[90] In oral submissions, Mr Gunther repeated much of what he had put in written submissions. He re-emphasised the applicants' belief that they had been dismissed during the telephone call on 1 March 2011. He submitted that this belief was well-founded when one considers the context and timing of the telephone call and the words used by Mr Melouney. In particular, Mr Gunther referred to being cautioned by Mr Melouney against applying for a personal loan, after having received a final, verbal warning the week before.

[91] In the alternative, Mr Gunther submitted that the respondent's conduct had left the applicants with no alternative but to resign from their employment. He said the applicants were unable to attend for work until 4 June, 2011 due to their respective ongoing mental health conditions which were triggered by the 1 March 2011 telephone call. Mr Gunther advised that the applicants have found alternative employment, but had been unemployed for a period of between 6 - 9 months following the cessation of employment with the respondent.

[92] The applicants submit that the Tribunal would find that an order for payment of compensation in lieu of reinstatement is appropriate in the circumstances (see s 390(3)). If the Tribunal was minded to award an amount of compensation, the applicants seek the maximum amount of 26 weeks at full pay (see s 392(6)).

[93] In a written outline of submissions, Ms T Babu, Workplace Relations Advisor - AAA - outlined the respondent's jurisdictional objection and provided a rebuttal to the applicants' contentions as to the substantive merits of the application/s.

[94] Ms Babu rejected the applicants' submission that they had been dismissed from their employment, within the meaning of s 386(1)) of the Act. She argued that the applicants had not been dismissed at all by the respondent but had 'walked off the job' on 4 June 2011, after a lengthy period of absence from the workplace.

[95] Ms Babu noted that Mr Melouney had called the 24 February 2011 meeting before Mr Gunther commenced annual leave on 25 February 2011, so that he could investigate a complaint raised by Mr Gunther in an incident report he had filed on 21 February 2011. The purpose of the meeting was not to terminate the applicants' employment. Ms Babu emphasised the uncontested evidence that the meeting had descended into a verbally abusive exchange between Mr Gunther and Mr Grundy. Subsequently, Mr Melouney placed both of them on final warnings as a result of their inappropriate conduct, as he felt that he had no choice but to do so.

[96] Ms Babu put that the Code did not apply to the respondent in relation to the 24 February 2011 meeting, as a 'dismissal,' within the meaning of the Act, had not taken place. In any event, Ms Babu contended that the respondent, in conducting its business, had complied with the requirements of the Code.

[97] As to the 1 March 2011 telephone call, Ms Babu rejected the applicants' assertion that, Mr Melouney had effectively terminated their employment during that conversation. Rather, Mr Melouney had contacted the applicant in response to a request he had made earlier that morning to have payslips faxed to him for the purposes of seeking a loan. During the telephone conversation, Mr Melouney had suggested Mr Gunther wait until after he had returned to work from annual leave as they had a 'few issues to sort through'. On this point, Ms Babu drew the Tribunal's attention to the evidence of Mr and Mrs Melouney, as a whole, and concluded that it had always been the intention of the respondent to give the applicants an opportunity to respond to these issues and to improve their performance. However, as the applicants had last attended for work on 24 February 2011, the respondent had not been given an opportunity to address its concerns regarding the applicants' work performance.

[98] In response to the improvement notice issued by WorkCover, Ms Babu observed that a number of workplace policies had been implemented by the respondent; namely, an anti-bullying policy and procedures and updated material safety databases.

[99] On 9 March 2011, Mr Gunther attended the workplace for the purpose of handing Mr Melouney medical certificates which exempted the applicants from further work until 22 March, 2011. He had not sought at all to engage with Mr Melouney.

[100] As to the events of 4 June 2011, Ms Babu noted that Mr Gunther had said to Mr Melouney, 'I'm getting all my gear and it's clear that I won't be coming back'. Mr Melouney had replied: 'I've never said that to you that you haven't got a job'. The applicants then collected most of their belongings, vacated their live-in accommodation and left the Park.

[101] Ms Babu referred to the applicants' email of 16 June 2011, in which they gave the respondent one week's notice of resignation, effective 23 June 2011. Ms Babu argued that the applicants would not have sent this email if they had believed their employment had been previously terminated by the respondent. Subsequently, the respondent received a letter from the applicants on 7 July 2011, dated 24 June 2011, marked 'letter of resignation', in which they stated that they felt they had no choice but to resign. However, even in this letter, they had agreed that 'no official dismissal took place'. Ms Babu submitted that this uncontested evidence indicated that the applicants - not the respondent - had terminated the employment relationship.

[102] Ms Babu relied on the authority in P. O'Meara v Stanley Works Pty Limited [C2006/2651] (11 August 2006) to support the respondent's submission that the applicants' decision to resign was a 'clear choice' and not a probable result of the employer's conduct. In addition, Ms Babu drew the Tribunal's attention to the decision in Mosey v Australian Customs Services (2002) 116 IR 2002 noting that the facts of this case did not impute an intention on behalf of the respondent to extract a resignation from the applicants. The Tribunal would not conclude that the applicants' resignations were coloured by an element of force or coercion.

[103] In oral submissions, Ms Babu repeated much of what was said in her written submission. In addition, she noted that the applicants had twice changed their argument. The applicants had initially claimed that they had been unfairly dismissed by the respondent, but then said that they were forced to resign. Ms Babu ultimately rejected both propositions and submitted that the applicants' claims for unfair dismissal were without jurisdiction and should be dismissed on that basis.

[104] Mr Gunther repeated much of his written submissions and expanded further on the arguments put forward in support of the substantive merits of their application/s for an unfair dismissal remedy; namely the applicants' work performance, procedural matters regarding the alleged dismissals and the inappropriate conduct of work colleagues.

[105] Notwithstanding that the substantive merits of this case have been thoroughly canvassed during the proceedings, there is no doubt that this case involves a preliminary jurisdictional finding prior to any consideration of whether the applicants' dismissals were unfair. This latter consideration will only arise if the jurisdictional objection raised by the respondent fails: see John Pinawin t/a Rose Vi.Hair.Face.Body v Mr Edwin Domingo [2012] FWAFB 1359. Pursuant to s 396 of the Act, FWA must decide the following matters before considering the merits of an application:

(a) whether the application was made within the period required in subsection 394(2);

(b) whether the person was protected from unfair dismissal;

(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;

(d) whether the dismissal was a case of genuine redundancy.

[106] The jurisdictional foundation of whether a particular dismissal is unfair is predicated on the requirements of s 385 of the Act, being satisfied. These requirements are as follows:

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

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

This section is to be read in conjunction with s 386(1)(b) as follows:

'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'.

[107] Shortly stated, the respondent maintains that it did not dismiss the applicants, either expressly or constructively, and as a consequence, FWA has no jurisdiction to determine any remedy for alleged unfair dismissal. The respondent insists that the applicants 'walked out' when they collected their belongings on the 4 June, 2011 and, in effect, abandoned their employment. It follows that there was no dismissal at the initiative of the employer under s 386(1)(a) of the Act and there existed no conduct by the employer or course of conduct which forced the applicants to resign (see s 386(1)(b) of the Act).

[108] Roberts C in Daffey v MSS Security Pty Ltd [2011] FWA 3983 set out, in some detail, the principles arising from the relevant authorities, as to what constitutes a 'forced resignation' ie a constructive dismissal. I respectfully quote extensively from the Commissioner's decision from para 26 - 40:

(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."

In the case before me, Mr Daffey maintains that subsection 386(1)(b) applies in his situation.

Jurisdiction can only exist where termination of employment at the initiative of the employer has occurred. "Initiative" is relevantly defined in the New Shorter Oxford Dictionary as:

"initiative 1. The action of initiating something or of taking the first step or the lead; an act setting a process or chain of events in motion; an independent or enterprising act."

This definition was considered in Mohazab v Dick Smith Electronics Pty Ltd 23 (Mohazab) where at p205 a Full Court of the Industrial Relations Court of Australia said, "… a termination of employment at the initiative of the employer may be treated as a termination in which the action of the employer is the principal contributing factor which leads to the termination of the employment relationship."

"In these proceedings it is unnecessary and undesirable to endeavour to formulate an exhaustive description of what is termination at the initiative of the employer but plainly an important feature is that the act of the employer results directly or consequentially in the termination of the employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship." 24

The reasoning in Mohazab was adopted by Full Benches of the Australian Industrial Relations Commission (AIRC) in Essential Personnel Pty Ltd v Wray 25, _Ngo v Link Printing Pty Ltd_26 and _Beck v Castran Gilbert Real Estate Pty Ltd_27, amongst others.

A Full Bench of the AIRC in Stubbs v Austar Entertainment Pty Ltd 28 said, "We do not doubt that Mr Stubbs believed he had good reason to resign. However, the fact that an employee has good reason to resign does not of itself establish that the employment is not voluntarily left by the employee. To constitute termination at the initiative of the employer the termination must be the direct or consequential result of 'some action on the part of the employer intended to bring the employment to an end and perhaps action which would, on any reasonable view, probably have that effect . . .'[Rheinburger v Huxley Marketing, 16 April 1996 per Moore J]."

A Full Bench of the AIRC in ABB Engineering Construction Pty Limited v Doumit 29 said:

"Often it will only be a narrow line that distinguishes conduct that leaves an employee no real choice but to resign employment, from conduct that cannot be held to cause a resultant resignation to be a termination at the initiative of the employer. But narrow though it be, it is important that that line be closely drawn and rigorously observed. Otherwise, the remedy against unfair termination of employment at the initiative of the employer may be too readily invoked in circumstances where it is the discretion of a resigning employee, rather than that of the employer, that gives rise to the termination. The remedies provided in the Act are directed to the provision of remedies against unlawful termination of employment. Where it is the immediate action of the employee that causes the employment relationship to cease, it is necessary to ensure that the employer's conduct, said to have been the principal contributing factor in the resultant termination of employment, is weighed objectively. The employer's conduct may be shown to be a sufficiently operative factor in the resignation for it to be tantamount to a reason for dismissal. In such circumstances, a resignation may fairly readily be conceived to be a termination at the initiative of the employer. The validity of any associated reason for the termination by resignation is tested. Where the conduct of the employer is ambiguous, and the bearing it has on the decision to resign is based largely on the perceptions and subjective response of the employee made unilaterally, considerable caution should be exercised in treating the resignation as other than voluntary."

"… in Minato v Palmer Corporation Ltd where Murphy JR referred to a number of cases dealing with the situation where "special circumstances" arise. He referred in particular to a UK decision where Wood J stated:

'If words of resignation are unambiguous then prima facie an employer is entitled to treat them as such, but in the field of employment personalities constitute an important consideration. Words may be spoken or actions expressed in temper or in the heat of the moment or under extreme pressure ("being jostled into a decision") and indeed the intellectual make-up of an employee may be relevant …These we refer to as "special circumstances". Where "special circumstances" arise it may be unreasonable for an employer to assume a resignation and to accept it forthwith. A reasonable period of time should be allowed to lapse and if circumstances arise during that period which put the employer on notice that further inquiry is desirable to see whether the resignation was really intended and can properly be assumed, then such inquiry is ignored at the employers risk. He runs the risk that ultimately evidence may be forthcoming which indicates that in the "special circumstances" the intention to resign was not the correct interpretation when the facts are judged objective.'"

In Pawel v Australian Industrial Relations Commission 30 (Pawel) Dowsett J said:

"When an employee resigns, he or she has usually reached a decision, taking into account many factors. Some may be entirely personal and unrelated to any "misconduct" on the part of the employer. An employee may resign because he or she has been passed over for promotion, has not received a pay increase, has a more attractive job offer or, as in the present case, finds aspects of his or her work uncongenial or undesirable. There can be any number of reasons for an employee to feel dissatisfaction, and there is always the possibility that it will lead to resignation. That dissatisfaction will often have been arguably caused (in part or in whole) by a decision or decisions of the employer. If "initiative" implies only causation, it will usually be arguable that the employer has "initiated" the termination. Although it may be good managerial practice to offer job satisfaction, it cannot be guaranteed. Many dissatisfied employees resign. The process prescribed in Division 3, which depends on termination, is too cumbersome to have been intended to resolve issues of that kind. I do not accept that any employee whose decision to resign was, to some extent, motivated by action or inaction on the part of the employer, may initiate proceedings pursuant to subs 170CE(1). Mere "causation" or "motivation" will not satisfy the requirement that the termination be at the initiative of the employer."

In P O'Meara v Stanley Works Pty Ltd 31 (O'Meara), a Full Bench of the AIRC said:

"In our view the full statement of reasons in Mohazab which we have set out together with the further explanation by Moore J in Rheinberger and the decisions of Full Benches of this Commission in Pawel and ABB Engineering require that there to be some action on the part of the employer which is either intended to bring the employment to an end or has the probable result of bringing the employment relationship to an end. It is not simply a question of whether "the act of the employer [resulted] directly or consequentially in the termination of the employment." 32 Decisions which adopt the shorter formulation of the reasons for decision should be treated with some caution as they may not give full weight to the decision in Mohazab. In determining whether a termination was at the initiative of the employer an objective analysis of the employer's conduct is required to determine whether it was of such a nature that resignation was the probable result or that the appellant had no effective or real choice but to resign."33

The decision in O'Meara was followed by her Honour Senior Deputy President Marsh in Beverley Hardcastle v C A Hill & Associates Pty Limited 34.

His Honour Senior Deputy President Richards in Hastie v Impress Australia Pty Ltd 35 (Hastie) considered the question of constructive dismissal under previous legislation. His Honour considered the previous case law on 'forced' resignation and his decision is worthy of inclusion at some length in this decision:

"It appears to me that the authorities in this area prior to the commencement of the Workchoices legislation sought to differentiate cases which attract the jurisdiction under Part 12 of the Act and those that do not. That is, it happens, that the authorities seek to distinguish between cases in which, on one hand:

• the employer's conduct has some degree of standing in the causal chain that brings about the resignation; but

• where the employer's conduct did not otherwise seek to bear oppressively upon the employee's volition (either intentionally to bring about the resignation or by some other oppressive or repugnant conduct such that the resignation was the probable result); and

• has as its intention the goal to bring about the resignation directly; or

• in all probability resulted in the resignation, for reason of its particular oppressive or repugnant character and/or its impact upon the employee's volition.

It is only when these latter circumstances are met that it can be said that the employer's conduct or course of conduct was the principal operative reason for the resignation, such that the termination can be said to have been at the initiative of the employer.

The employer's conduct (when it is not evidenced was intended to bring about the resignation directly) must be conduct that is in some way or in some manner oppressive or repugnant in the ordinary course, and/or else so impacted on the volition of the employee such that the resignation was a reasonable response to that conduct in all the circumstances.

If this were not the case, then it would be difficult to distinguish between many instances of voluntary resignations which arise from a discretionary judgment of the employee, and resignations which are the result of the conduct of the employer. This is because, for all practical purposes, most decisions by an employee to resign their employment arise from the conduct of the employer, in some manner or form. That is, employer conduct is causally responsible at some level for most resignations.

But not all the species of the conduct of an employer have the probable result of the employee's resignation or make the resignation, on an objective view, a reasonable response to the employer's conduct. It is only a sub set of employer conduct that ought to attract the remedy against a harsh, unjust or unreasonable termination of employment based on a termination at the initiative of the employer. 36

To describe the conduct of the employer as forcing an outcome suggest that the conduct in some manner or form compelled or mandated or obliged or necessitated the resignation of the employee. These seem to be the common dictionary meanings of "forced".

In a narrow sense, no resignation is ever forced unless there is some observable physical intervention by the employer. Consequently, all resignations are likely to be voluntary, in a narrow sense. Such was commented on by Dowsett J in his minority decision in Pawel v Advanced Precast Pty Ltd 37:

"As to 'compulsion', it is difficult to contemplate circumstances in which it can be said that an employee has been compelled to resign, but not dismissed, unless one accepts the somewhat bizarre reference in the course of argument to an employer holding a gun to the employee's head." 38

That said, to describe an employer's conduct as forcing a resignation does not demand a narrow reading such as this. Force may be applied in a physical sense, as Dowsett J describes it, or else it may be applied indirectly, by the conduct or the course of conduct by an employer which makes an outcome. Of course, many such examples of such conduct might be provided, and a person may be forced or compelled to adopt a course of action by a variety of actions taken by their employer.

Generally, the exercise of force may take many forms, and there is little point in exploring these in detail. But common manifestations of 'force' will always exhibit an outcome in which a person acts contrary to their desired intention, and because of the conduct of another person that was directed at or towards them.

I do not think the definition should be limited to cases in which an employee can demonstrate that the employer took positive action of some kind that was motivated to bring about the resignation, though many cases no doubt will fall into that category. The conduct of an employer, wilful or not, may nonetheless generate circumstances in which the resignation of an employee was the probable result.

It would appear to me, then, that on an ordinary or natural reading of the term "forced", an employee may be forced (or compelled) to resign for reason of the employer expressly demands the resignation (perhaps, though not necessarily, in conjunction with a threat of termination), or makes the conditions of work so oppressive or repugnant to the employee (and the employment relationship), and/or else, so bears down on the volition of the employee, that the resignation was a reasonable probable response to the circumstances the employee faced at the time." 39

It now falls to me, on the balance of probabilities, to determine what actually occurred in the ending of the employment relationship between Mr Daffey and MSS. I am guided by the views expressed by Dowsett J in Pawel.

On the evidence and materials before me, I am unable to conclude that Mr Daffey's employment was terminated at the initiative of MSS based on any conduct or pattern of conduct by the Company aimed at bringing about his resignation'.

[109] In my view, the case for the applicants suffers from a fundamental and incurable contradiction. If the applicants genuinely believed that they had been dismissed in the phone call from Mr Melouney on 1 March 2011, it makes no sense, at all, why they would firstly, give notice of resignation on 16 June 2011 and secondly, provide a detailed letter of alleged forced resignation on 24 June 2011, alleging constructive dismissals.

[110] Obviously, if the date of the phone call (1 March 2011) is accepted as the date of dismissal, the applicants face the inevitable jurisdictional hurdle that their applications for unfair dismissal remedies are well outside the 14 day time limit set out in s 394 of the Act by some 113 days. There was no submission, let alone evidence, advanced by the applicants that the Tribunal should find that 'exceptional circumstances' exist which would warrant the exercise of FWA's discretion to extend the time for filing of their applications, consistent with the requirements of s 394(3) of the Act. On the other hand, I apprehend that there was inferential reference to 'exceptional circumstances' being the fact that they were both on sick leave and / or workers' compensation from 9 March 2011 (the date they were due back at work after annual leave) and that this reason may be viewed as a basis for claiming they were unable to lodge their unfair dismissal claims within the prescribed time; although I note it did not prevent them from lodging other claims and otherwise corresponding with the respondent in the time before their s 394 applications were lodged with FWA on 5 July, 2011.

[111] In any event, as I said earlier, this was not the case prosecuted by the applicants. To put it simply, the applicants cannot have it both ways. In other words, there cannot be two dates of dismissal - one actual and one constructive. Even so, these preliminary observations are not strictly relevant to the disposition of these proceedings. This is so because I do not believe there was a dismissal of the applicants on either 1 March 2011, 16 June 2011 or the 24 June 2011.

[112] There is no doubt that Mr Gunther believed that he and Ms Daly had been dismissed during the telephone call from Mr Melouney on 1 March 2011. While I accept that Mr Gunther suspected or perceived that the purpose of the meeting with Mr Melouney might result in their dismissals, the test of whether the applicants were actually dismissed, or to be dismissed, are not based on perceptions or suspicions, but whether the decision had actually been made by Mr Melouney and dismissal was inevitable. Unsurprisingly, Mr Gunther submitted it was clear from the respondent's own evidence, that this can be the only conclusion FWA could come to. While it seems to me that there was an air of inevitability surrounding the dismissals of the applicants, I cannot be satisfied that a final decision had been made, on 1 March 2011 or at any subsequent time. Nor can I be satisfied that Mr Gunther knew it to be so and Ms Daly even less so. The respondent's evidence, particularly the notations recorded by Mr Melouney were, certainly frank admissions of the likelihood of dismissal, but the truth is, Mr Gunther could not have drawn from Mr Melouney's telephone call, a positive conclusion that he and Ms Daly had been dismissed. Indeed, their own evidence fortifies my findings in that regard. Moreover, the applicants' subsequent actions do not comfortably fit with the notion that he and Ms Daly had been dismissed. I come to this conclusion for the following reasons:

(a) It is difficult to reconcile a claim of being dismissed on 1 March 2011 with the fact that the applicants took no action to dispute their dismissals until 13 June 2011 - some 14 weeks later. They still did not file their s 394 applications until 5 July, 2011.

(b) On the applicants' own evidence, Mr Melouney in the telephone call had only requested Mr Gunther attend a meeting and cautioned him on entering into a large debt in view of the precarious state of his employment. In my opinion, Mr Melouney was being honest and open with Mr Gunther in that regard.

(c) Mr Gunther's own evidence was that 'we thought for sure we were getting called back to be dismissed'. They were not called back. This comment can only be interpreted as a belief that he had not been dismissed in the telephone call, but was expecting a dismissal at some later time. Mr Gunther further said 'we realised we would not be able to perform our duties if we had to return to work in that condition'. This is a curious comment if the applicants thought they had already been dismissed.

(d) Although the applicants were not at work, they continued to be paid for a further 2 months. This was hardly consistent with a decision by the employer to dismiss the applicants some months earlier. During this time, the applicants made no attempt, personally or indirectly, to confirm their employment status.

(e) It seems extraordinary to me, that when the applicants returned to give Mr Melouney their medical certificates on 9 March 2011 they claimed to be too ill to speak to him.

(f) The applicants turned up at the Park again to collect their belongings on 4 June 2011 (another reference has this date as being the 10 June 2011 - although the difference is not materially relevant). They did not ask anyone about their employment status, or seek separation certificates. They proceeded to remove their belongings. I accept the evidence of Mr Melouney that Mr Gunther said words to the effect that 'I won't be coming back'. This was a clear indicia of the applicants' intention to sever the employment relationship.

(g) Even if Mr Melouney had a positive intention to dismiss the applicants at a meeting when they returned to work, the applicants did not return to work and obviously there was no meeting. Moreover, if it was Mr Melouney's determined intention, he took no further steps to action it. In other words, if there was an intention, it did not materialise into an actual dismissal.

(h) Ms Field's uncontested evidence was that the Melouneys could not dismiss Assistant Managers without her approval, or at the very least, with her knowledge. At no stage had this occurred. Her evidence also raises the question that if the Melouneys were answerable to the Area Managers, why they didn't appeal to the effective decision maker or someone in higher authority then the Melouneys?

(i) It remains inexplicable to me, if the applicants' dismissals took place on 1 March 2011, why they would submit a notice of resignation and an actual resignation in June 2011. Was it because their income had ceased? I accept it was said that these resignations were forced by the employer, but I can identify no action or conduct by the respondent to prompt, coerce or force their resignations. I will come back to this matter shortly. Indeed, in reality, the respondent did nothing relevant to their employment from 1 March 2011 to 19 June 2011 (when Mrs Melouney discontinued their pay and sent them separation certificates).

[113] I do not accept that there was a course of conduct by the employer, which forced their resignations; namely, a workplace culture of bullying which was condoned or ignored by Management. All of the witnesses for the respondent gave evidence that the applicants had never complained of workplace bullying or harassment before 24 February 2011 nor had they ever witnessed any such conduct by the respondent. The applicants had not complained about the pressure of work or of being unhappy at work.

[114] There was, of course, a workplace culture of 'niggling' and 'name calling' which Mr Gunther himself was not adverse to be involved in. It is incorrect to submit that the WorkCover inspector found a workplace culture of bullying. In the absence of an appropriate policy, he did no more than recommend a policy be introduced to deal with workplace bullying and harassment. To elevate this recommendation to an actual finding of bullying, is a complete misrepresentation.

[115] In addition, the purported conduct (including the swearing of Mr Grundy) does not support a conclusion that the employer had permitted or condoned a course of conduct which forced the applicants to resign. Mr Melouney's general warning to all employees and his specific 'talking to' Mr Grundy are not the actions of an employer ignoring the problem. It rather demonstrates the reverse. In any event, as I noted earlier, Mr Gunther cannot claim to be 'lily white' in that regard.

[116] As to the incident involving Mr Melouney and Ms Daly, I do not accept its characterisation as a threat of physical violence against Ms Daly. Obviously, it was a regrettable and unacceptable comment. However, I accept Mr Melouney's explanation that it was nonspecific and not personally directed towards Ms Daly. In any event, I conclude that Ms Daly agreed with Mr Melouney's explanation and accepted his apology. In my opinion, Ms Daly's belief that she had been bullied and harassed stemmed more from her partner's interactions with the other staff, rather than from her own personal experiences with the respondent and other employees.

[117] Using the statutory language, I find that the applicants were not dismissed at the employer's initiative or forced to resign by the conduct or a course of conduct engaged in by the employer. It follows that the applications are not validly before FWA and must be dismissed for want of jurisdiction.

[118] Given these findings, it is unnecessary to make any further findings as to the merits of the applications, specifically the alleged breach of the Code by the respondent. Axiomatically, if there were no dismissals, the Code could not have been breached. Nevertheless, as Ms Field properly conceded, had the respondent's jurisdictional objection not been upheld, I would conclude that the Code had not been properly followed. A final warning given to a group of employees, without any earlier warnings, must on any view, be inconsistent with the Code. That said, I accept Mr Melouney was frustrated and 'fed up' with the ongoing niggling in the workplace. Nevertheless, he would have been well advised to have sought advice prior to the 24 February meeting. However, I hasten to add that a breach/s of the Code by a small business employer might not necessarily result in a finding that an employee's dismissal was unfair. However, I need take this matter no further in this decision.

[119] For the aforementioned reasons, I find that the applicants were not dismissed by the respondent. It follows that FWA has no jurisdiction to deal with the applicants' claims of alleged unfair dismissal. Pursuant to s 587(1)(a) of the Act, these applications are dismissed for want of jurisdiction. Orders to that effect are published contemporaneously with this decision.

For the respondent: Ms T Babu, Workplace Relations Advisor, Accommodation Association of Australia.

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