Fair Work Act 2009

s.394 - Unfair dismissal

Unfair dismissal application - whether applicant dismissed or resigned - objective test - applicant requested day off - threatened to take bogus sick leave if refused - left work despite warning - no dismissal on employer's initiative - application dismissed

[1] This decision concerns an application made by Mr Jack Lipari under s 394 of the Fair Work Act 2009 (Cth) (Act) for an unfair dismissal remedy. Mr Lipari contends that on 9 January 2019 he was unfairly dismissed from his employment with YPA Estate Agents Pty Ltd (YPA), where he had worked since October 2017. He says that the reason he was dismissed was because he asked his manager for permission to take a day off to assist his mother to go to the doctor. He also says that the company would not let him return to work after he went home sick following an argument with his manager.

[2] The company objects to the application on the jurisdictional ground that Mr Lipari was not dismissed within the meaning of s 386 of the Act. It says that on 8 January 2019 Mr Lipari abandoned his employment following a disagreement with his manager, during which Mr Lipari asked for the following day off, threatened to take a 'sick day' if his request was refused, rejected a compromise proposal, became angry and then left work, despite his manager telling him that if he left he should not come back. Alternatively, the company says that if there was a dismissal, it occurred in conformity with the Small Business Fair Dismissal Code, and that in any event it was not unfair.

[3] The unfair dismissal application was listed before me on 3 June 2019, both in relation to the company's jurisdictional objection and the merits of the application. I conducted the proceeding as a determinative conference. Mr Lipari represented himself and gave evidence on his own behalf. The company was represented by Mr Mark Crupi, who was Mr Lipari's manager, Ms Nancy Crupi, chief operations officer, and Mr Anthony Yanko, the chief executive officer of YPA.

[4] I will first address the factual background to this matter. There are several areas of conflicting evidence in respect of which I must make factual findings, including in particular what occurred during the exchange between Mr Crupi and Mr Lipari on 8 January 2019.

[5] Mr Lipari's evidence was that on Tuesday 8 January 2019 at around 7.00 am he said to Mr Crupi that he wanted to take the following day off in order to 'do a few things' and take his mother to a doctor's appointment, but Mr Crupi rejected his request because work was too busy. Mr Lipari replied that he did not agree that work was busy. According to Mr Lipari's witness statement, he said to Mr Crupi that he was willing to come to work later on the Wednesday and do certain jobs but Mr Crupi again said 'no'. In his outline of argument document, at section 6d, Mr Lipari stated categorically that Mr Crupi 'would not allow me to attend to my mothers (sic) medical needs'. However, in his oral evidence, Mr Lipari said that Mr Crupi told him that he could go to the appointment with his mother and then come to work later, and that he had replied that he would do this. Mr Lipari said that Mr Crupi then changed his mind about this proposal however he could not recall what Mr Crupi said to convey this change of mind.

[6] Mr Lipari gave evidence that he could not remember whether, as the company contends to be the case, he told Mr Crupi that he would take a 'sick day' if his request for a day off were rejected. He said that he 'lost his temper and walked out' because his anxiety 'went sky high'. Mr Lipari said in evidence that he told Mr Crupi that he was going home ill, but later, in response to a question from me, he said that he did not tell Mr Crupi that he felt ill, and that he 'left in a fit of rage'. He said that he did not hear Mr Crupi say that if he left, he should not come back; but he also said that Mr Crupi did not say this at all. Mr Lipari said that he went home and spent the day in bed and tried to calm himself down.

[7] Mr Lipari's evidence was that he spent Wednesday 9 January 2019 in bed because he was not feeling well. He said that he did not take his mother to her doctor's appointment. He believed that some other family members may have taken her, but was not sure. Later on Wednesday he spoke to Ms Crupi about returning to work the next day, but she told him that he should not come to work. Mr Lipari says that the company thereby dismissed him.

[8] Mr Crupi gave a different account of his conversation with Mr Lipari on 8 January 2019. Mr Crupi said that Mr Lipari told him that he wanted to take the next day off to 'do some stuff', to which he said 'no' and asked if Mr Lipari could take a day off during the following week instead. Mr Lipari then said that he needed to take his mother to a specialist. Mr Crupi said that he asked Mr Lipari if he could take his mother to the appointment and then come to work afterwards, but Mr Lipari said no, because he had other things to do.

[9] According to Mr Crupi, Mr Lipari said that if he was not allowed to take the day off, he would just take a 'sick day', to which Mr Crupi replied that this would be very unfair. Mr Lipari became angry. He said words to the effect of 'fuck the boards they can wait,' referring to certain tasks that Mr Crupi wanted Mr Lipari to perform. Mr Crupi did not grant Mr Lipari the day off. Mr Lipari then said 'stuff this joint', and Mr Crupi said to him that if he left he should not come back. Mr Lipari did not say he was going home sick. Mr Lipari then went to the car park and got in his car, spun his wheels in the driveway and drove off. Mr Crupi said that he then tried to call Mr Lipari but he did not answer. Mr Crupi then called Ms Crupi and told her what had happened.

[10] Ms Crupi's evidence about the telephone call she received from Mr Crupi on the morning of 8 January 2019, and what Mr Crupi told her about his discussion with Mr Lipari, is consistent with Mr Crupi's evidence. She said that at about 7.45 am, after speaking with Mr Crupi, she called Mr Lipari. He told her that he had asked Mr Crupi for the day off to take his mother to an appointment. Ms Crupi told Mr Lipari that she had spoken to Mr Crupi, and that Mr Crupi would have allowed him to take his mother to the appointment and come to work later in the day. Mr Lipari said to Ms Crupi that in fact he needed the whole day off, and that the work Mr Crupi wanted him to do could be done later. He also said that he had told Mr Crupi he would take a sick day if his request was not granted.

[11] Ms Crupi's evidence was that during this telephone call she said to Mr Lipari that, even though he had walked off, if he came straight back she would meet him at the factory and they could try to sort it out. Mr Lipari said 'no', and that he would call her later. Ms Crupi said that she told Mr Lipari that he had abandoned his employment and if he wanted his job he should call her back, but he did not do so. Mr Lipari denied that Ms Crupi said these things.

[12] What happened next is not in contest. On Wednesday 9 January 2019 Mr Lipari did not come to work or contact anyone to advise that he would not be attending for work. Ms Crupi said that at around 12.50 that day she sent Mr Lipari a text message asking him to call her. At about 3.30 Mr Lipari called and said that he was in a 'good mood now'. Ms Crupi said that he had abandoned his employment. Mr Lipari hung up. Ms Crupi then sent him a text message, stating that they needed to meet so that she could collect his key. Mr Lipari responded: 'No problem. Happy to do so when you work out my final pay. Let me know what annual leave I have remaining and my full entitlements. Can you also send me a letter stating I have removed (sic) from the company and a reference for future employment.'[1]

[13] Ms Crupi wrote to Mr Lipari on 14 January 2019, setting out the annual leave accruals that would be paid out to him, and stating that although Mr Lipari had abandoned his employment, the company would pay him two weeks' pay 'in good faith'.

[14] I accept Mr Crupi's account of his discussion with Mr Lipari on 8 January 2019. Mr Crupi was a witness of truth. His evidence was clear, candid and spontaneous. It was consistent with Ms Crupi's evidence about what Mr Lipari said to her on the telephone. On the other hand, Mr Lipari's evidence was neither consistent nor convincing in several important respects that I shall advert to below.

[15] I make the following findings. First, I find that Mr Crupi said to Mr Lipari that he could take his mother to the specialist and then come to work later in the day. Secondly, I find that Mr Lipari rejected this proposal and said that he had other things to do that day. I reject Mr Lipari's evidence that he said to Mr Crupi that he was willing to come to work after taking his mother to the doctor. If he had agreed to this proposal, there would not have been a problem. But there was a problem because Mr Lipari had other things to do apart from helping his mother and wanted to take the whole day off. I reject Mr Lipari's evidence that Mr Crupi changed his mind about the proposal that Mr Lipari come to work after taking his mother to the doctor. Mr Lipari could not explain what Mr Crupi had said to him to suggest that he had changed his mind. Moreover, Mr Lipari's evidence about this part of the discussion was inconsistent. He said on the one hand that Mr Crupi would not allow him to come back to work after the doctor's appointment, but then acknowledged that Mr Crupi had said that he could do this.

[16] Thirdly, I find that Mr Lipari said to Mr Crupi that, if he was not allowed to take the day off, he would take a 'sick day'. Mr Crupi's evidence about this was clear and consistent. Mr Lipari said that he did not remember saying these words. I find this difficult to believe. Mr Lipari's statement was a threat to take false sick leave. It was not a claim to take a day of sick leave as carer's leave, as employees are entitled to do under the National Employment Standards in the Act, subject to the relevant conditions. Mr Crupi told Mr Lipari that he could take time off to bring his mother to the doctor; what he could not do was take the whole day off to attend to 'other stuff'. In the present context, therefore, Mr Lipari's statement that he would take a sick day meant that, if his request for a day off was not granted, he would take the day off anyway under the guise of being sick. Making such a statement is inherently memorable. So too is not making such a statement. I reject Mr Lipari's evidence that he does not recall whether he made this statement. I note that Mr Crupi's evidence is consistent with that of Ms Crupi, who was also a credible and convincing witness. She said that Mr Lipari recounted to her that he had told Mr Crupi he would take a sick day if his request was not granted.

[17] Fourthly, I find that Mr Lipari did not think that the workplace was very busy and that he could do the work required of him on the Wednesday at a later time. Specifically, I find that he said to Mr Crupi words to the effect of 'fuck the boards, they can wait'.

[18] Fifthly, I find that Mr Lipari was angry because he was not granted the Wednesday off. I find that he felt anxious and upset because he did not get what he wanted. I do not accept that he was unfit for work, either on the Tuesday or the Wednesday. I find that Mr Lipari did not say to Mr Crupi that he was sick or going home ill.

[19] Sixthly, I find that Mr Lipari said to Mr Crupi words to the effect of 'stuff this place', and that Mr Crupi then said to Mr Lipari words to the effect that if he left, he should not come back. Mr Crupi explained that his discussion with Mr Lipari took place around a table. There was no suggestion that it might have been difficult for Mr Crupi and Mr Lipari to hear one another, or that there was a misunderstanding. Mr Lipari did not say that his emotional state might have resulted in him not hearing or processing the statement, nor in my view is that what occurred. I note that Mr Lipari's evidence on this part of the conversation was inconsistent. He said that he had not heard Mr Crupi make the statement but he also said categorically that Mr Crupi had not made the statement, and that Mr Crupi must have imagined it. I accept Mr Crupi's evidence that he made the statement above. I also reject Mr Lipari's evidence that he did not hear Mr Crupi make the statement, which I consider highly improbable. I find that he heard what Mr Crupi said.

[20] Finally, I accept Ms Crupi's evidence about what she said to Mr Lipari on the telephone on the morning of 8 January 2019 (see paragraph [11] above). I found her to be a candid and credible witness and prefer her evidence to that of Mr Lipari.

[21] In light of these findings, I now consider whether Mr Lipari was dismissed by YPA or resigned from his employment.

[22] Section 386(1)(a) of the Fair Work Act 2009 (Act) states that a person has been dismissed, for the purposes of the unfair dismissal provisions in Part 3-2 of the Act, if the person's employment has been terminated 'on the employer's initiative.' It is necessary for me to decide whether Mr Lipari was dismissed by YPA within the meaning of s 386(1)(a), or whether he resigned from his employment. In the latter regard, whether a person has resigned is not assessed by reference to the parties' subjective intentions or understandings. It depends on what a reasonable person would have understood to be the objective position, taking into account what was done and said, and the surrounding circumstances.[2]

[23] In the present case, Mr Lipari asked for the next day off and his manager refused, proposing instead that he take his mother to the doctor and then come to work later in the day. Mr Lipari rejected this proposal and threatened to take an unauthorised and illegitimate sick leave day. He said to his manager 'stuff this joint' and left. He did not say he was going home ill. He was told by his manager that if left the workplace he should not come back. In my view this clearly conveyed to Mr Lipari that if he walked off the job the company would consider him to be ending his employment. Despite this, Mr Lipari left work sometime after 7.00am that day and did not return. He also did not attend for work the following day or make any effort to contact the company until 3.30 that afternoon.

[24] I do not consider that Mr Crupi's words or conduct during his conversation with Mr Lipari on 8 January 2019, or Ms Crupi's discussion with Mr Lipari the following day, can be described as a termination of employment 'on the employer's initiative'. The case law on this concept makes clear that it entails termination of employment brought about by the employer and which is not agreed to by the employee. In cases where the employment relationship is not left voluntarily by the employee, the focus is whether any action on the part of the employer was the principal contributing factor leading to the termination of the employment.[3]

[25] In the present case, Mr Lipari voluntary left his employment. The company's actions did not lead to the end of his employment. What ended the employment was Mr Lipari's decision to walk off the job on the early morning of Tuesday 8 January 2019. The company frames its jurisdictional objection by reference to 'abandonment of employment', but fundamentally its case is that Mr Lipari ended his employment. In my view, objectively considered, Mr Lipari's actions, together with his statement 'stuff this joint', conveyed a clear intention to resign. This intention is underscored by the circumstances that Mr Crupi told Mr Lipari how he would interpret his decision to leave the workplace, and that Mr Lipari proceeded to leave work despite this.

[26] As I have said, whether a person has resigned is to be judged objectively, not subjectively, and it is therefore not strictly necessary to consider whether Mr Lipari believed that he had resigned. In the present matter, a reasonable person would have clearly understood, taking into account what was done and said, and knowing the surrounding circumstances, that Mr Lipari intended to resign. However, in my opinion Mr Lipari's subsequent conduct supports a conclusion that he fully appreciated that he had resigned. He did not take up Ms Crupi's offer on the telephone on 8 January to meet and try to work things out. Further, the text message Mr Lipari sent to Ms Crupi on 9 January 2019 raised no grievance or objection or concern in respect of the end of his employment. Although his words 'I have removed from the company (sic)' are ungrammatical, their meaning is in my view clear. It is consistent with Mr Lipari having resigned. He had removed himself from the company. Mr Lipari did not contend, nor do I consider it plausible, that he intended to ask for a letter from the company stating that he had 'been removed from the company', as his text is talking about a reference for future employment. Then on 11 January 2019, after Ms Crupi sent Mr Lipari a text saying that she had been at a funeral and had not yet processed his paperwork, Mr Lipari replied stating that he was 'Sick of all the BS ... Thats (sic) why I no longer work for a company has (sic) no idea and needs to learn how to treat people right and manage people'. This message too says nothing of a dismissal and is consistent with Mr Lipari having chosen to resign from a company for which he no longer wished to work.

[27] On 12 January 2019, Mr Lipari sent a message to Mr Yanko, raising a range of grievances about Mr Crupi and the company, and in this letter he asserts that he was dismissed on 9 January 2019. Mr Lipari was, to say the least, slow to raise any suggestion that his employment had been terminated. I note that in his letter to Mr Yanko, Mr Lipari said that the reason for his dismissal was that 'the boards were more important than my mothers (sic) specialist appointment'. This statement seems disingenuous, given that Mr Lipari did not take his mother to the appointment, and does not know whether his mother went to her appointment or not.

[28] At the hearing, Mr Lipari said that he doubted that the print out of the screen shots of his text exchange with Ms Crupi on 9 January 2019 was accurate. Ms Crupi produced her telephone and showed him the actual texts. At that point, Mr Lipari seemed to recall the text he had sent, and said that the only reason he wrote it was to try to get Ms Crupi to identify the reason for his termination, apparently to use in evidence. This explanation is simply not believable. It was a late and vain attempt to explain away an inconvenient piece of evidence.

[29] Mr Lipari did not contend that he resigned in the 'heat of the moment'. He said that he did not resign at all. I have nevertheless considered whether, given he was angry and stormed off, his case might fall within the circumstances described in Bupa Aged Care Australia Pty Ltd v Tavassoli, where a Full Bench of the Commission considered the authorities in relation to resignation in the context of s 386(1)(a) and concluded:

"(1) There may be a dismissal within the first limb of the definition in s.386(1)(a) where, although the employee has given an ostensible communication of a resignation, the resignation is not legally effective because it was expressed in the "heat of the moment" or when the employee was in a state of emotional stress or mental confusion such that the employee could not reasonably be understood to be conveying a real intention to resign. Although "jostling" by the employer may contribute to the resignation being legally ineffective, employer conduct is not a necessary element. In this situation if the employer simply treats the ostensible resignation as terminating the employment rather than clarifying or confirming with the employee after a reasonable time that the employee genuinely intended to resign, this may be characterised as a termination of the employment at the initiative of the employer."[4] (Emphasis added)

[30] It is clear from this passage that the mere fact that a person resigns in circumstances of heightened tensions or strong emotions will not turn a rash or imprudent decision made by an employee into a dismissal at the initiative of the employer. Rather, if, applying the objective test referred to by the Full Bench, it can be said that the employee could not reasonably be considered to have conveyed a real intention to resign, then there may be a termination on the employer's initiative if the employer treats the resignation as effective. The conclusion must be that objectively no such intention was evident, not simply that it is fair to allow the employee an opportunity to rethink the matter. There is no statutory 'cooling off' period for resignations. It is for the Parliament to create any such rule. The Commission cannot fashion one.

[31] Mr Lipari asked for a day off. When this was not granted he became angry. He rejected Mr Crupi's proposal that would have allowed him to take his mother to the doctor, because he had other things to do that day and wanted to take the whole day off. He left work without offering any justification. He decided to leave his employment.

[32] I have taken into account Mr Lipari's evidence that he suffers from depression and anxiety. I am prepared to accept that he has mental health challenges. But I do not accept, and there was certainly no medical or other evidence to indicate, that these problems affected his decision-making process, or, importantly, that the company was aware that Mr Lipari had any mental health problems. An objective and reasonable assessment of the circumstances was that Mr Lipari chose to resign from his employment when he did not get his way.

[33] Other evidence is compatible with the conclusion that Mr Lipari chose to resign. Mr Lipari evidently had a number of grievances against the company, including that he had not had a pay rise for some time, that there was not enough work, and that he had been required to come back early from annual leave. He said that he was 'disgruntled' with his employer. It is not surprising that he chose to resign.

[34] This is clearly not a case where the employer gave the employee no choice but to resign. The company did not unreasonably refuse a legitimate request for carer's leave. It was prepared to grant leave to allow Mr Lipari to take his mother to the doctor, but required him to come to work later on the day in question. Mr Lipari offered no good reason why he could not do that. Mr Lipari told Mr Crupi that he had other things to do on the Wednesday besides taking his mother to her medical appointment. His motivation for requesting a day off was not confined to taking his mother to her appointment. He did not need the whole day off to take his mother to the doctor. In my view, the company would have been entitled to be sceptical about Mr Lipari's asserted need to take his mother to an appointment, and require him to produce evidence. The company, through Mr Crupi, acted more than reasonably by taking the request at face value and seeking to accommodate it.

[35] Even if I had found that Mr Lipari's employment was terminated at the initiative of the employer, I would have concluded that the dismissal was not unfair.

[36] The company employs nine employees. Mr Lipari did not contend otherwise. The company submitted that any dismissal was consistent with the Small Business Fair Dismissal Code (Code), and was therefore not unfair (see s 385(c)). I find that the company is a small business employer for the purposes of the Act and the Code, but for the following reasons, it cannot be said to have complied with the Code.

[37] The first stream of the Code concerns summary dismissal. It provides that it is fair for an employer to dismiss an employee 'without notice or warning' when the employer 'believes on reasonable grounds' that the employee's conduct is 'sufficiently serious to justify immediate dismissal'. In this case, the company did not believe it had dismissed Mr Lipari at all, and there was no evidence about any belief, on reasonable grounds, that Mr Lipari had engaged in serious misconduct. The company cannot therefore rely on the first limb of the Code. The second stream of the Code concerns dismissals other than for serious misconduct, and provides that the employer must give the employee a reason for dismissal, which must be a valid reason, and must warn an employee about the risk of dismissal if there is no relevant improvement in conduct or performance. The company did not comply with this stream of the Code because it did not provide Mr Lipari with a reason for dismissal, for the simple reason that it did not believe that it had dismissed Mr Lipari.

[38] As the company did not comply with the Code, the question of whether any dismissal by the company of Mr Lipari was unfair would need to be determined by reference to the usual considerations set out in s 387 of the Act.

[39] Was there a 'valid reason for the dismissal related to the person's capacity or conduct', as contemplated by s 387(a)? Plainly so. A 'valid reason' is one that the Commission considers to be a sound and substantiated reason. It does not need to be the employer's actual reason. In the present case, Mr Lipari left work without permission on the morning of 8 January 2019. He did not come to work the next day. By the time Mr Lipari's alleged dismissal occurred later on 9 January 2019, he had been absent from work without authorisation for nearly two days. He contravened a fundamental term of his contract of employment by failing to attend for and perform work. Even if it is accepted that Mr Lipari needed to take his mother to a doctor's appointment, this would, at most, provide an explanation for a partial absence from work on the Wednesday. It provides no justification at all for absenting himself from work on the Tuesday. Further, I do not accept that Mr Lipari's feeling anxious and upset provides an acceptable reason for leaving work without permission. I do not accept that he was unfit for work on 8 January. Mr Lipari's unauthorised and unjustified absence from work is a valid reason for dismissal.

[40] Further, as I have explained above, Mr Lipari threatened to take a day of bogus sick leave on the Wednesday if his request for a day off was not granted. Assuming he did not resign, Mr Lipari then carried out his threat. He did not come to work on the Wednesday. He later suggested that he was sick. He submitted no medical evidence to support this contention. I do not accept that he was unfit for work on 9 January. I accept Mr Lipari's statement that he has mental health challenges, but I do not accept, without medical evidence, that these caused him to be unfit for work on 8 or 9 January 2019. Threatening to take a day of false sick leave, and carrying out this threat, constituted a second valid reason for dismissal.

[41] As to the other considerations in s 387, I note that Mr Lipari was not notified of a reason for dismissal, and was not given an opportunity to respond to any reasons for his dismissal (sections 387(b) and (c)). There was no unreasonable refusal to allow Mr Lipari to have a support person present to assist at any discussions relating to dismissal (s 387(d)), as there were no such discussions and no request for a support person was made. The notional dismissal did not relate to poor performance (s 387(e)). The small size of the employer's enterprise would have been likely to impact on the procedures followed in effecting the dismissal, by rendering them less robust than might be expected of a bigger organisation (s 387(f)). I would attribute minimal weight to this. There was no evidence about whether the company had dedicated human resources management specialists (s 387(g)). As to any other matters the Commission considers relevant (s 387(h)), I take into account the financial effect of the notional dismissal on Mr Lipari and that he has not found other employment. I do not accept his contention that he lost his role at Uber because of the stress and depression associated with his dismissal from YPA. There is no medical evidence to substantiate this. Further, the company submitted a Facebook post made by Mr Lipari in which he stated that he was 'suspended for making racist remarks' and that Uber is the worst company he ever worked for.

[42] Weighing all these considerations, I conclude that any dismissal of Mr Lipari was not harsh, nor was it unjust or unreasonable. Rather, it was a dismissal for which there was a good and valid reason and which, in all the circumstances, was not unfair.

[43] In the present case, there is simply no basis to conclude that the end of Mr Lipari's employment was the result of any conduct on the part of the company. On the contrary, an objective assessment of the circumstances shows that Mr Lipari intended to resign, and did resign from his employment, entirely of his own volition.

[44] Mr Lipari was not dismissed on the initiative of the employer for the purposes of s 386 of the Act. The company's jurisdictional objection is upheld and Mr Lipari's unfair dismissal application is therefore dismissed.

Ms N Crupi, Mr M Crupi and Mr A Yanko for YPA Estate Agents Pty Ltd

[1] See text screen shots attached to exhibit R1

[2] Koutalis v Pollett [2015] FCA 1165; 235 FCR 370 at [43]

[3] Khayam v Navitas English Pty Ltd [2017] FWCFB 5162 at [75]

[4] [2017] FWCFB 3941 at [47]

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