Fair Work Act 2009

s.394 - Unfair dismissal

MBP (WA) Pty Ltd as trustee for the Sun Laundry Services Unit Trust

[1] This decision concerns an application made by Mr Hayden Richardson (the Applicant or Mr Richardson) under section 394 of the Fair Work Act 2009 (Cth) (the Act). The respondent is MBP (WA) Pty Ltd as trustee for the Sun Laundry Services Unit Trust (the Respondent).

[2] Below is a list of witnesses and their positions:

• Mr Richardson;

• Mr Paul Miles, Managing Director of the Respondent; and

• Mr Jimmy Lee, Operations Manager of the Respondent.

[3] Mr Richardson was first employed by the Respondent in July 2012.

[4] The Respondent operates a commercial laundry business providing laundry services to a range of businesses including hotels, function centres, restaurants and mining companies.

[5] Around December 2018 the Respondent's operations moved from its original site to a new plant at a new location (New Plant).

[6] The business employs approximately 70 administrative employees and laundry hands at the New Plant.

[7] The New Plant is more advanced than the old plant. The old plant had five dryers and required less skill on the part of the operators to operate the system compared with the New Plant. The old plant was very labour-intensive and had a lot of manual activities. The New Plant has seven dryers. The New Plant is run by a mechanised conveyor system which is run through a computer running Windows.

[8] The New Plant has three sections being washing, drying and ironing/folding/dispatch.

[9] When the New Plant commenced an unrelated business, Jensen Laundry Services (Jensen) were in charge of the installation and training of staff. Jensen is part of an international group that assists laundry businesses to upgrade their laundry technology.

[10] The evidence of Mr Miles, the owner and Managing Director of the Respondent was that Jensen trained all the laundry workforce on the operation of the New Plant. He was involved in that training as the owner and says all staff including Mr Richardson participated in that training. [1]

[11] In the old plant, Mr Richardson's duties were to put empty tubs underneath the dryer and when the tubs were full to move them to the ironing department. He was also responsible for putting identification marks on tubs.

[12] In the New Plant Mr Richardson on morning shift was responsible for operating and cleaning the dryers and associated machinery to ensure a steady flow of clean laundry for other staff to process; and dealing with any errors in the system including ensuring tubs were available for collection, clearing error messages and ensuring the conveyors did not stop.

[13] In the New Plant another laundry hand carries out the same role as Mr Richardson on the afternoon shift.

[14] In late 2018 early 2019, Jensen and Mr Miles trained Mr Richardson as to the operation of the New Plant and updated machinery.

[15] Mr Miles evidence was that there were some stoppages in the New Plant and he could see what the causes were. There were conversations between Jensen staff and himself about what was happening and where the issues were.

[16] When there was an issue with the dryers (like a blocked lint screen) the dryer would stop until that problem is addressed. The dryer will sound an alarm which is quite loud. To silence the alarm Mr Richardson needed to address the error.

[17] Mr Miles evidence was that from early January 2019, Mr Richardson was struggling to cope with the new system. There were frequent stoppages in the New Plant which led to frustration from the other staff as there was not a steady flow of linen from the dyers for the other staff to process. The project manager from Jensen spoke to Mr Miles and identified Mr Richardson as being the reason for these stoppages. [2]

[18] In late January 2019, there were still issues with the dryers because Mr Richardson could not keep up. Consequently, in February Mr Miles moved another staff member from the washroom to provide Mr Richardson with more training.[3]

[19] Notwithstanding training and discussion with Mr Richardson, instead of pressing the computer screen carefully, he would hit it sufficiently hard that he broke the screen costing the respondent $8000.00 to replace it.

[20] Mr Miles says he discussed all of these problems with Mr Richardson as they arose.[4]

[21] A part of Mr Richardson's role operating the dryers is to ensure the screen on the dryers are kept free of lint. Jensen had installed a new lint extraction system as lint can be a health hazard if breathed in. The system was not performing well on the morning shift when Mr Richardson was the operator but was very effective on the afternoon shift. Mr Miles says:

"in early February 2019, I investigated the situation and found Mr Richardson was not cleaning the dryers properly".

[22] Mr Miles evidence was that accumulation of lint around Mr Richardson's dryer got so bad the lint was 100mm deep under the dryers. Lint is highly flammable, and this was a serious fire hazard and safety risk yet Mr Richardson showed no inclination to clean the lint.

[23] On a number of occasions in late February and early March 2019, Mr Miles discussed these matters with Mr Richardson. When he told Mr Richardson he needed to clean the lint, Mr Richardson would say it's not his job the cleaner should do it_._ Mr Miles would reinforce with him that it was his job and needed to be done.

[24] On one occasion because Mr Richardson was not taking responsibility, he stopped the dryer cycle system and asked Mr Richardson to clean up the lint. Mr Miles returned 20 minutes later to check on whether the lint had been cleaned only to find that the job was not done.

[25] Mr Miles evidence was as follows:

"Our conversation continued as follows or to the following effect:

PM: Hayden, Why have you still not cleaned up the lint.

PM: You can find the vacuum cleaner in the cleaning room

I left Hayden to get the job done. When I returned sometime later that day, there was no evidence that the work had been done. The conversation continued:

HR: I could not find a power point to plug the unit in.

By this stage I was totally frustrated so I plugged the vacuum cleaner in and cleaned up the lint myself. The job took around 20 minutes.

I asked Hayden to stand next to me so he could see how to complete the work correctly."

[26] To try to fix this situation Mr Miles allocated an additional staff member to the dryer role on the morning shift to help Mr Richardson. His evidence was:

"This did not assist the situation as two days later in early March 2019, I again observed Hayden not cleaning the lint from the dryer."

[27] Mr Miles says he spoke to Mr Richardson as follows:

"He told me it was the afternoon shift employee's fault as they had not cleaned the dryers properly. However, I knew from the machine log that the lint was not there because of the afternoon shift employees but because of Hayden. I say this because I had checked the bin and it was full of lint put there by the afternoon shift workers. I could also tell from the electronic log which showed that there had been minimal stops of the dryer the previous afternoon."

[28] At this stage Mr Miles says they were experiencing continual issues with Mr Richardson's performance.

[29] In late March 2019, Mr Miles saw Mr Richardson had a tub with red dirt in it (a tub from a mine site) which he had put clean white linen into. The white linen had been cleaned in the New Plant.

[30] When Mr Richardson was asked why he put clean linen into the dirty tub he replied that he could not find a clean one. When asked why he did not ask someone to assist him or why he hadn't washed out the tub, he replied that it was not his job.

[31] Because of the problems with Mr Richardson's performance in April 2019 Mr Miles moved him to a new role which required less skill.

[32] Mr Miles explained to Mr Richardson the new role was to move a plastic tub containing freshly washed and folded linen from the factory to the storage/despatch area and to unpack the linen and place it on the shelf in the storage area.

[33] On about 22 April 2019, Mr Miles noticed that in the storage/dispatch area the linen was thrown on the shelves and not stacked neatly as it ought to have been. Having linen unstacked and thrown about meant that the linen had to be re ironed before it could be sent to the client.

[34] Mr Miles says he asked one of the dispatch staff, Mr Wilson Lopez (Mr Lopez), why the linen had been thrown all over the place. Mr Lopez told him it was Mr Richardson's work and he had done this.

[35] Mr Lopez said he had already spoken to Mr Richardson and his response was:

[36] Mr Miles having himself experienced this response believed what Mr Lopez had told him.

[37] Mr Miles says he spoke to Mr Richardson later that day and told him:

"Enough is enough. My patience is at an end. You need to perform you job correctly or I will dismiss you. "

"I did not do anything wrong. Other staff need to do their jobs. No one showed me how to stack the linen on the shelf."

[39] Mr Miles took him to one of the shelves and showed him what the stacked linen should look like on the shelf.

[40] Mr Miles was frustrated at this point and asked his new Operations Manager Mr Jimmy Lee his opinion of Mr Richardson in the time that he had been there. Mr Lee told Mr Miles that Mr Richardson did not listen to his fellow staff members and was a poor worker.

[41] On or about 26 April 2019, Mr Miles says he noticed that one of the shelving units in the dispatch area had been hit by something and this had moved the shelf forward by about 200mm.

[42] The shelving was out of alignment and leaning on an angle. He was amazed someone could hit the shelving that hard that it would move it that far.

[43] The only person who was delivering tubs of linen to that area was Mr Richardson.

[44] Mr Miles was very concerned because if that shelving had collapsed, someone could have been seriously hurt.

[45] It was clear to him that all the conversations and warnings to Mr Richardson were having no effect.

[46] Mr Miles felt that not only was his performance poor, he was not willing to address these issues and he was now damaging items of plant.

[47] Mr Miles decided that for the safety of staff, the risk of continued damage to equipment and the viability of the business he had to terminate Mr Richardson's employment.

[48] On Friday, 26 April 2019, Mr Miles asked Mr Lee to meet with Mr Richardson on Monday, 29 April 2019 and terminate his employment because Mr Miles had to leave the workplace to deal with a medical issue concerning his father.

[49] Mr Lee's evidence was that when he commenced working at the business in March 2019, Mr Richardson was working as a laundry hand operating and cleaning the dryer. Shortly after he started with the business, he noticed that Mr Richardson was not doing a good job as a dryer and he thought he lacked knowledge and expertise in working with the dryer.

[50] Around this time Mr Miles moved Mr Richardson from the factory to the storage/dispatch area where his role would be to unpack the linen from the tubs and place it on the shelf in the dispatch area.

[51] In April 2019, Mr Lee observed Mr Richardson seemed to be having difficulty in that role. In around mid-April, Mr Lee spoke with Mr Lopez about Mr Richardson's performance. Mr Lopez told him that Mr Richardson was not listening to Mr Lopez's instructions

[52] In mid to late April 2019, Mr Miles spoke to him about Mr Richardson's performance. Mr Miles asked Mr Lee what he thought of Mr Richardson's work.

[53] Mr Lee says that he told Mr Miles he thought that Mr Richardson was not a good worker and he did not listen to his fellow staff members nor did he listen to instructions provided by managers or supervisors.

[54] Mr Lee says on 26 April 2019, Mr Miles asked him to meet with Mr Richardson to terminate his employment on 29 April 2019. Mr Miles told him that one of the shelving units in the dispatch area had been damaged due to Mr Richardson and his performance had been so bad for months that the business had no other choice.

[55] Mr Miles said to Mr Lee he could not speak to Mr Richardson because he had to deal with a medical issue concerning his father that would keep him out of the office for a day or two.

[56] Mr Lee's evidence was that at about 2.00pm on Monday 29 April 2019, (at the end of the morning shift) he called Mr Richardson aside.

[57] Mr Lee's evidence was that he said to Mr Richardson that when he was initially working with the dryers his performance was bad so they had to move him to dispatch, stacking linen on the shelves. He then said that Mr Richardson was not listening to Mr Lopez, the Supervisor there and he was having trouble in dispatch. Mr Lee's evidence was that he then waited for Mr Richardson to comment. Mr Richardson did not say anything. Mr Lee then said to Mr Richardson that he was not properly stacking the linen on the shelving. Mr Richardson did not deny what he was saying. Mr Lee says that he waited for Mr Richardson to respond to what he had said. Mr Richardson said nothing.

[58] Mr Lee's evidence was that he then said that as a result of his performance, they could not keep him and that today would be his last day.

[59] In his evidence Mr Richardson agrees he received training in the new plant and Jensen was involved in that.[5]

[60] Mr Richardson agrees that in the New Plant he was shown what to do regarding the lint and cleaning up the lint.[6]

[61] He explained that if lint builds up, the machine will tell him and if it is building up in the dryers, the machine will tell him that it's building up on the outside section and if the outside sections has lint built up, then you're going to get clogged machines and if you don't clean the outside filters where all the lint goes then it's going to clog up. [7]

[62] Mr Richardson acknowledges that he had another staff member to assist him on the dryers in the New Plant.[8]

[63] He acknowledges that at times there was lint accumulating underneath the dryers. He agrees it is highly flammable. He agrees it is a health hazard and that it needs to be cleaned up straight away.[9]

[64] His evidence was that it was a problem to clean the lint because he would have to shut the whole machine down which would upset the other staff and Mr Miles because there were production targets.[10]

[65] Mr Richardson denies having a conversation with Mr Miles about the lint where he said cleaning it up was not his job. He denies Mr Miles talking to him about using the vacuum cleaner, nor showing him how to use it.[11]

[66] His evidence was that he would occasionally clean the lint up with a broom.[12]

[67] Mr Richardson explained that he did clean the lint but also explained that he had quite a few jobs to do and wasn't just doing the cleaning, he had other jobs as well. [13]

[68] He denies ever saying that cleaning the lint is not his job.[14]

[69] Mr Richardson explained that at times there would not be a clean tub to put clean linen into and if that was the case, he would take a sheet and put it in the bottom of the dirty tub but sometimes it might not cover the whole of the tub.[15]

[70] He does recall a conversation with Mr Miles who saw him with clean linen in a dirty tub but says that there was a sheet in the bottom at the time.[16] However he does not recall saying to Mr Miles that it was not his job to find a clean tub or to clean the tub.

[71] Mr Richardson agrees that in April 2019, he was moved from working with the dryers into dispatch but does not accept that this was because he was not doing the former job properly.[17]

[72] He denies having any conversation with Mr Miles about this new role. He agrees his new role was pretty simple, that the pressed and folded linen is placed in a tub and his role was to use the pallet jack to move the tub into dispatch. He would then pick up the stacks of sheets from the tub and put them on a shelf.[18]

[73] Mr Richardson denies talking to Mr Miles at all about how the linen was stacked in the dispatch area and denies having a discussion with Mr Lopez about this.

[74] He denies Mr Miles ever talked to him where he said that his patience was at an end and he needed to perform his job correctly or be dismissed.[19]

[75] Mr Richardson denies banging a pallet jack with the tub of linen into the shelving and damaging it and he denies being showed the damaged shelves by Mr Miles.[20]

[76] On his last day of employment Mr Richardson agrees that Mr Lee spoke to him about 1.30pm. Mr Richardson says Mr Lee told him he had a tough decision to make and told him that his performance wasn't up to scratch then he said a number of other things which Mr Richardson says he could not remember and then Mr Lee told him that "I'm going to have to let you go".[21]

[77] Mr Richardson denies that Mr Lee mentioned his performance with the dryers, not listening to the directions of Mr Lopez and not properly stacking the linen on the shelves.

[78] Mr Richardson says that every time Mr Lee said something, he responded to him.[22]

[79] Considering the evidence of the three witnesses above and noting that there is some conflict in part between the evidence of Mr Richardson, Mr Miles and Mr Lee my findings as to what occurred are as follows.

[80] There is little dispute as to the history of how the Respondent came to establish the New Plant in late 2018, and broadly the consequence for the Applicant's role working in the New Plant. There were changes to how the plant operated which directly resulted in changes to the Applicant's role and duties.

[81] The Applicant was trained by Jensen in how to operate the new more automated system. Other staff were similarly trained by Jensen.

[82] After the initial training of the Applicant, in February when it became apparent there were problems with how he was performing further training was provided. In addition, the Respondent next arranged for an additional staff member to assist the Applicant on morning shift.

[83] I find that the Applicant did break the console screen which had to be replaced by the Respondent at a cost of $8000.00. This was not a deliberate act by the Applicant but a result of him not following instructions as to how to properly use the screen.

[84] I find on the evidence that the Applicant was not performing his role on the morning shift to the standard required by Mr Miles even after further training had been provided and additional help for the Applicant, in the form of an additional staff member, had been provided. Multiple attempts had been made to assist the Applicant improve his performance to no avail.

[85] The standard of performance required by Mr Miles was a reasonable standard that was being achieved by another employee using the same equipment on afternoon shift.

[86] The Applicant was either unwilling to or unable to perform his role to the reasonable standard required of him.

[87] As a consequence of the Applicant's underperformance in early April 2019, Mr Miles decided to remove him from the work in the drying area and give him a less complex role in the storage/dispatch area.[23]

[88] After some time, it became obvious that the Applicant was not performing his new role properly either. He was not properly stacking the linen as he was required to. I find Mr Miles said to him, he must do his job properly or he would be dismissed.

[89] Shortly thereafter, Mr Miles noticed that the shelving on which the heavy linen was stacked by the Applicant had been damaged, it was out of alignment and was at risk of collapsing under the heavy load.

[90] As the Applicant's new role involved him moving tubs loaded with linen through this area Mr Miles believed the damage to the shelves must have been caused by the Applicant when moving a tub full of linen.

[91] I note the Applicant denies damaging the shelves. On the balance of probabilities, I do find that the damage to the shelves was caused by the Applicant moving a tub full of linen through the area and making contact with the shelving.

[92] I find that between January and April 2019 Mr Richardson was reacting negatively to Mr Miles criticism and never accepted his performance was unsatisfactory or that he was responsible for any of the problems that occurred.

[93] Following this, Mr Miles decided that the Applicant's performance continued to be entirely unsatisfactory, notwithstanding he had been moved into a simpler role and consequently he decided his employment would be terminated.

[94] The instruction Mr Miles gave to Mr Lee in late April 2019 was to terminate the Applicant's employment.

[95] Mr Lee met with the Applicant and I find he did say to him that his performance had been unsatisfactory and that this was the reason he was being terminated.

[96] Section 387 sets out the matters the Commission must consider when deciding whether an employee's dismissal was harsh, unjust or unreasonable. This section is set out below.

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

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

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

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

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

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

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

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

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

[97] Throughout January 2019 and the end of April 2019, Mr Richardson's performance had been unsatisfactory, notwithstanding additional training, additional support and then being moved to an alternative less complex role. Mr Richardson had either been unwilling to or unable to achieve the standard of performance required by the Respondent. This was a reasonable standard.

[98] Mr Richardson's unsatisfactory performance over a period of four months was a valid reason for his dismissal related to his capacity.

[99] During the discussion with Mr Lee on the day Mr Richardson was dismissed, he was notified of the reasons for his dismissal.

[100] Whilst Mr Richardson did have an opportunity to respond to the unsatisfactory performance complaints that Mr Lee spoke to him about on the day he was dismissed, this was in fact after the Respondent had made the decision to dismiss Mr Richardson.

[101] Mr Lee had been told by Mr Miles to meet with Mr Richardson and terminate his employment. Mr Lee as directed did so. Mr Lee was not provided with any discretion by Mr Miles in the matter. Mr Miles the owner and Managing Director had made the decision to dismiss Mr Richardson before Mr Lee met with Mr Richardson.

[102] Consequently, Mr Richardson had no opportunity to respond to the reasons the Respondent was considering dismissing him, before the decision to dismiss him was made.

[103] There was no unreasonable refusal by the Respondent to allow Mr Richardson to have a support person present to assist at any discussions. Mr Richardson did not request to have a support person involved at any time.

[104] Mr Miles in his evidence gave detailed accounts of a number of discussions with Mr Richardson that occurred before his dismissal, one of which in his evidence, I agree was a warning about his unsatisfactory performance.

[105] Mr Richardson in his evidence denies these particular discussions occurred or occurred as Mr Miles said they did.

[106] Mr Miles evidence on what he said to Mr Richardson was detailed and he was unshaken in cross-examination on this. Mr Richardson's evidence was limited to denials these discussions occurred or statements that Mr Miles evidence was fabricated.

[107] Considering this conflict in witness evidence, I find that Mr Miles did in speaking to Mr Richardson say to him that he needed to do his job properly or he may be dismissed. This was said by Mr Miles in the course of his day-to-day interactions with Mr Richardson. The discussions occurred where Mr Richardson was working and whilst he was working. Mr Miles did not ask Mr Richardson to stop work and meet with him in some other area, such as an office.

[108] There was no documentation by Mr Miles of any performance warning given to Mr Richardson.

[109] The Respondent has 70 employees so is a medium-sized business. This is of sufficient size to have had an understanding of appropriate procedures to follow when effecting a dismissal.

Dedicated Human Resource Manager and specialists or expertise

[110] It is not clear from the evidence as to whether the Respondent has dedicated Human Resource Manager specialists or expertise or not. Consequently, this issue is neutral.

[111] Mr Richardson had been employed since July 2012 and so had over six and a half years' service. During that time and prior to the New Plant becoming operational in late 2018, Mr Richardson was not subject to any warnings nor were there any other blemishes on his employment record.

[112] While Mr Richardson had under performed for a number of months much of this period was immediately following the change to his duties that occurred as a consequence of the Respondent setting up the New Plant.

[113] Mr Richardson was either unable to or willing to adapt to the new requirements involved in his role.

[114] Mr Miles had tried to support Mr Richardson in coping with these changes by providing further training and later another staff member to assist him working in the dryer area. Ultimately this was unsuccessful and Mr Richardson's performance unfortunately did not improve.

[115] Rather than at this point considering dismissal of Mr Richardson, Mr Miles instead moved him into a different area of the laundry into a less demanding role.

[116] Regrettably even in this relatively simple role[24] Mr Richardson, with more than six years' experience with the Respondent, again failed to meet the Respondent's reasonable performance standards.

[117] I have found that whilst Mr Richardson was working in this alternative role Mr Miles did tell him he needed to do his job properly or he may be dismissed. Mr Richardson's performance however did not improve and so Mr Miles decided to terminate his employment.

[118] However, there were some shortcomings in the procedure followed by the Respondent in dismissing Mr Richardson.

[119] Whilst I accept there was a verbal warning to Mr Richardson about his unsatisfactory performance, the context in which this warning was given was such that it is possible Mr Richardson failed to grasp that his job was seriously at risk, although I note he has not given evidence to that effect.

[120] In addition, as explained above Mr Miles made the decision to dismiss Mr Richardson without explaining to him that he was considering doing this and explaining why he was considering dismissing him. In that sense Mr Richardson had no opportunity to respond to the reasons for which he was dismissed by Mr Miles, before Mr Miles made the decision to dismiss him.

[121] In some circumstances procedural deficiencies may result in the Commission concluding a particular dismissal was either harsh, unjust or unreasonable and so unfair even though there was a valid reason for the employer to dismiss the employee.

[122] In this case Mr Richardson throughout his evidence did not accept responsibility for any underperformance by him over the four-month period. He has never suggested that if he had been unambiguously warned his job was at risk if his performance didn't improve that he would have done anything differently.

[123] In addition Mr Richardson has not suggested that, if he been advised of the reasons for which he was to be dismissed before Mr Miles made the final decision to dismiss him, he had information or argument to put to Mr Miles that may have changed his mind.

[124] In the circumstances my decision is that even if the Respondent adopted best practice procedure prior to making the decision as to whether or not to dismiss Mr Richardson, no different outcome would have resulted, and Mr Richardson would have been dismissed as he was.

[125] Considering all the matters above Mr Richardson's dismissal was not harsh, unjust or unreasonable. Mr Richardson's dismissal was not unfair.

[126] This application will be dismissed and an order to that effect will be issued in conjunction with this decision.

R Saharan of Saharan Family & Criminal Lawyers for the Applicant.

B Jackson of Moray & Agnew Lawyers for the Respondent.

[1] Exhibit R1 at para [7] and PN352 - 355.

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