[2013] FWC 1269

Fair Work Act 2009

s.394 - Unfair dismissal

Wilson Curry Pty Ltd; GreenGroup Property Investments Pty Ltd; A&M Green Investments Pty Ltd; S&K Green Investments Pty Ltd; GreenGroup Property Holdings Pty Ltd; Kensington Gardens Lifestyle Estates; A&M Investment Pty Ltd; Glendette Pty Ltd; Eastcoast Management Services Pty Ltd

s394 - application for unfair dismissal remedy.

[1] This application is made under s394 of the Fair Work Act 2009 (the Act). This matter was first dealt with by conciliators of the Fair Work Commission (the Commission) and the matter was unable to be resolved. The matter then proceeded to arbitration by the Commission. The arbitration was dealt with in Shepparton on Friday 22 February 2013.

[2] The application was made by Ms McMahon (the Applicant), who was represented by counsel, against her previous employer, Kensington Management Services Pty Ltd trading as Kensington Gardens Shepparton (the Respondent). The Respondent did not attend the hearing.

[3] An application was made by the Applicant to amend the name of the Respondent to Wilson Curry Pty Ltd and add A&M Green Investments Pty Ltd; S&K Green Investments Pty Ltd; GreenGroup Property Investments Pty Ltd; GreenGroup Property Holdings Pty Ltd; Kensington Gardens Lifestyle Estates; A&M Investment Pty Ltd; Glendette Pty Ltd; Eastcoast Management Services Pty Ltd. An order [PR534339] was made by the Commission under s586 of the Act to amend the name of the Respondent in accordance with that application.

[4] The following decision (now edited) was handed down in transcript at the conclusion of the hearing:

[5] The Applicant commenced in employment on 1 February 2010, along with her husband, Mr Ian McMahon, as caretaker at Kensington Gardens, Shepparton. There were a series of events commencing on 5 April 2010 with a conversation with Mr Peter Stanbrook. That resulted in a meeting with Mr Stanbrook and the Applicant on 10 April 2012.

[6] That discussion revolved primarily around two points: (1) an allegation against the Applicant of disclosing management discussions to residents and (2) an allegation that the Applicant was rude to residents.

[7] During those discussions the Respondent failed to disclose what they meant by being rude to residents, based on the assertion that it was confidential and breached the privacy provisions. However, at the conclusion of that meeting on 10 April 2012 the parties agreed that the matters had been settled and the Respondent, represented by Mr Peter Stanbrook in that matter, indicated basically that matters that happen in Shepparton stayed in Shepparton - words to the effect - kept in the Shepparton office.

[8] On 6 April 2012, the Applicant received two emails from a Regional Manager, Mr Col Ward. In those emails Mr Ward indicated that Mr Stanbrook was happy with the outcome on 10 April. Arising from what appears to be the contents of that meeting on 10 April, correspondence was received by the Applicant on 23 April signed by Mr Shaun Green on behalf of now Wilson Curry Pty Ltd but then known as Kensington Management Services Pty Ltd. That letter is headed "Show Cause" and the Commission doesn't intend to read the contents of that letter into transcript; however, the Applicant did respond to that letter later that day 23 April.

[9] A meeting was called by Mr Stanbrook on 26 April 2012. At that meeting, the Applicant attended, along with her husband. A letter was provided dated 26 April. The Commission will read that letter into transcript:

"Mrs Diana McMahon, Kensington Gardens, Shepparton.

Thank you for your email response. I have considered your response carefully. I note that you deny that you said to Peter that you would continue to talk about work related matters with residents. I note that there was an independent witness at the meeting, Ian Duncalf. Mr Duncalf has confirmed that you did say to Peter that you would continue to discuss work related matters with the residents.

In those circumstances, I am satisfied that you did in fact acknowledge that you have disclosed the content of discussions you have had with management with the residents and I am satisfied that you stated to Peter that it was your intention to continue to do so.

I note in your email response, your statement, that you will keep future discussions with management confidential. However, after giving full consideration to all the material I have decided that the potential risk to the organisation of disclosure of the contents of discussions with management and the potential harm this can cause the relationship between residents and management means that it is not possible to continue with your ongoing employment.

Accordingly, I hereby give you notice of termination effective immediately. You are to vacate the house forthwith."

Signed by Mr Sean Green, Kensington Management Services Pty Ltd.

[10] The Commission is advised that at the meeting that occurred on 10 April 2012 where these issues were discussed and appeared to be resolved nothing further occurred between 10 April and the letter of termination dated 26 April 2012 going to any further allegations against the Applicant. At neither of those meetings was the Applicant provided with the opportunity to have a support person nor at the meeting on 26 April was she provided with an opportunity to respond to the content of the letter dated 26 April 2012 terminating her services.

[11] The Commission understands that her husband was terminated approximately two days later but those matters are subject to an application under s.365 of the Fair Work Act.

[12] In the period of employment which commenced on 1 February 2010 to 10 April 2012 the Applicant advised under oath that there had been no issues raised regarding her work performance nor was she advised that her employment at some point may be in jeopardy due to some actions that she may or may not have occurred nor was she warned or counselled during the period of her employment.

[13] Having considered whether or not the termination is a valid termination there are two things that the Commission must consider - if there was a valid termination, whether the termination was harsh, unjust and unreasonable. If the Commission determines that there were no valid reasons for the termination then it doesn't have to consider the issues of harsh, unjust and unreasonable, and it then turns its mind to remedy.

[14] Having considered all the material that has been provided to the Commission and there is an extensive file, and the Applicant has addressed the major points that the Commission is required to consider, the Commission would determine that there was no valid reason for the termination of the Applicant.

[15] It would appear to the Commission that the actions by the Respondent breached not only procedural fairness but also natural justice in that although the Applicant did respond to the "Show Cause" letter dated 23 April 2012 it would appear that the Respondent already had a pre-determined outcome and that was that the Applicant's services were to be terminated for something that may occur in the future. There would have been, in the Commission's view, alternatives to termination but it would appear that the Respondent had made its mind up.

[16] Turning to the issue of remedy, the Commission would agree that re-instatement is out of the question. It would then turn its mind to the issue of compensation. In turning to the issue of compensation, s.392(2) of the Act states:

(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

(a) the effect of the order on the viability of the employer's enterprise; and

(b) the length of the person's service with the employer; and

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

(g) any other matter that the FWC considers relevant."

[17] In relation to (a) the Respondent has made no attempt to address the issues raised in the application by the Applicant by way of submissions, understanding that this matter was going to proceed. Therefore the Commission was unaware of any effect on the viability of the employer's enterprise.

[18] In relation to (b), it would appear that the Applicant had a period of service of slightly over two years, commencing 1 February 2010 and being terminated on 26 April 2012, and that would appear to be an unblemished service.

[19] In relation to (c), the Commission is satisfied that there would be no reason that the Applicant could not have enjoyed some long term employment with the Respondent.

[20] In relation to (d) the Applicant has indicated that they have a casual position elsewhere and continues to earn an income, although not as significant as her position with the Respondent.

[21] In relation to (e), the Commission has just addressed that point.

[22] In relation to (f), there is a period of seven days sought by the Applicant in the draft order.

[23] In relation to (g), one of the issues that the Commission considers relevant is what may be termed reprehensible conduct by the Respondent in this particular matter towards an employee that, in the Commission's view, has served the Respondent well and has acted in a professional capacity in the period of their employment with the Respondent.

[24] The Applicant has provided a draft order. That draft order at point 3 says:

"The named respondents in Order 1 are jointly and severally liable to pay the Applicant within seven days compensation of $59,050 pursuant to section 392 of the Fair Work Act 2009.

[25] The Commission is advised that that is the maximum amount available under the Act, which is six months.

[26] Given what the Commission has termed to be the reprehensible conduct on the part of the Respondent, the Commission included the amount of $59,050 in its order [PR534339].

[27] Point 5 of the draft order goes to the issue of costs and the Applicant has addressed that; however, in case it is criticised for lack of procedural fairness and natural justice I think it's only appropriate that the Commission provides that appropriate part of the transcript to M&K Lawyers in Queen Street, Brisbane and provide them with an opportunity to respond.

[28] Once given an opportunity to respond, if they choose to take that up the Commission will provide a copy of that response to the Applicant for further comment and the Commission will then determine the issue of costs based on the papers.

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