Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Application for an unfair dismissal remedy - jurisdictional objection upheld - Small Business Fair Dismissal Code complied with.

[1] On 28 November 2016, Grandbridge Limited (Grandbridge) summarily dismissed Ms Diane Wiburd (Ms Wiburd) on the grounds of serious misconduct. Ms Wiburd applied for an unfair dismissal remedy under s.394 of the Fair Work Act 2009 (Cth) (the Act) (the Application). Grandbridge is a small business employer within the meaning of s.23 of the Act. It raised a jurisdictional objection to the Application on the ground that it had complied with the Small Business Fair Dismissal Code (Code) with the result that Ms Wiburd's dismissal was consistent with the Code.

[2] Deputy President Binet determined that Grandbridge's dismissal of Ms Wiburd was not consistent with the Code and Grandbridge lodged an appeal against the Deputy President's decision on 3 August 2017 (the Decision). Permission to appeal was granted, the appeal was upheld, the Decision quashed and the question of whether Grandbridge complied with the Code in relation to Ms Wiburd's dismissal was referred to me.

[3] The parties expressed their view that the rehearing could be determined on the papers unless there were questions for Counsel to address[1]. One issue was raised with Counsel concerning submissions and evidence on whether Grandbridge was a small business employer pursuant to s.23 of the Act. The parties addressed this issue in writing allowing the matter to proceed on the papers.

[4] This decision deals with the question referred. For reasons that will become clear, I am satisfied that Grandbridge complied with the Code in relation to Ms Wiburd's dismissal and therefore the Application is dismissed.

[5] At the time of Ms Wiburd's dismissal Grandbridge had two employees, Ms Wiburd and Mr David Breeze, Director of Grandbridge (Mr Breeze). Mr Breeze had dismissed Ms Deborah Ambrosini (Ms Ambrosini) for reasons that will become clear[2]. With regard to the companies related to Grandbridge Mr Breeze stated it was his understanding that associated entities, MEC Resources Limited (MEC) and another entity, had only 2 employees.

[6] Deputy President Binet set out some of the background relating to Ms Wiburd's employment and dismissal at paragraphs [13] to [45] of the Decision. Neither party has objected to that background and for the purpose of this decision such background is adopted. It follows:

[13] Grandbridge is a corporation listed on the ASX. The directors of Grandbridge are Mr Breeze, Mr Kevin Hollingsworth (Mr Hollingsworth) and Ms Deborah Ambrosini (Ms Ambrosini)[3].

[14] Mr Breeze owns 32.14% of the shares in Grandbridge, either in his personal capacity or via companies which he controls called Trandcorp Pty Ltd (Trandcorp) and Trandcorp Superannuation Pty Ltd (Trandcorp Super)[4].

[15] Grandbridge owns 4.87% of the shares in MEC Resources Limited (MEC) and is the largest shareholder in MEC[5]. Ms Wiburd has a very small share holding in MEC.

[16] MEC is managed from the same premises as Grandbridge, and employs several staff including Ms Natascha Hughes (Ms Hughes) and Mr Toby Foster (Mr Foster) who also perform work from time to time for Grandbridge[6].

[17] Mr Breeze has been Managing Director of Grandbridge for the past 16 years. Until November 2016, Mr Breeze was also Managing Director of MEC pursuant to the terms of a contract between MEC and Trandcorp[7].

[18] In 2008, Ms Ambrosini was appointed the Company Secretary and Chief Financial Officer of Grandbridge. In April 2012, she was appointed a Director of Grandbridge and MEC[8]. The other directors of MEC are Mr Goh Hock (Mr Hock) and Mr KO Yap (Mr Yap)[9].

[19] Ms Wiburd commenced employment with Grandbridge on or around 17 January 2007[10].

[20] At the time of her dismissal, Ms Wiburd's remuneration was $77,625.00 per annum[11].

[21] Ms Wiburd was initially employed as Mr Breeze's Personal Assistant. However, since 2008, she had worked closely with Ms Ambrosini[12].

[22] Sometime before 2 November 2016, Ms Ambrosini, Mr Hock and Mr Yap agreed that Mr Breeze should be removed as Managing Director of MEC because they were dissatisfied with the manner in which he was discharging his duties[13].

[23] Voting at annual general meetings (AGM) of Grandbridge, MEC, and their related entities is mostly done by proxy unless the shareholder is going to personally attend the AGM[14].

[24] On 4 November 2016, Ms Ambrosini instructed Ms Wiburd to forward the proxy voting forms to exercise Grandbridge's voting rights at the upcoming MEC AGM to her so that she and Mr Hollingsworth could complete them. Ms Ambrosini and Mr Hollingsworth did not exercise the proxy in the manner which Mr Breeze wanted the proxy to be exercised.

[25] On or around this date, Ms Wiburd provided Mr Breeze with the proxy voting forms for him to exercise the voting rights associated with his personal shareholdings and those of Trandcorp and Trandcorp Super at the MEC AGM[15].

[26] Ms Wiburd was one of several staff members of Grandbridge whose duties included maintaining the spread sheet which recorded the proxy votes received in advance of the MEC AGM (Electronic Proxy Reconciliation)[16].

[27] On 11 November 2016, Mr Breeze asked Ms Wiburd for copies of the proxies which had been lodged for the upcoming Grandbridge, MEC, and related entity AGMs. Ms Wiburd informed Mr Breeze that Ms Ambrosini had taken the file containing the proxies home[17].

[28] Ms Wiburd was absent from the workplace from 17 November 2016 until 28 November 2016 on annual leave[18].

[29] On 19 November 2016, Mr Breeze attended the Grandbridge office and was unable to locate the hard copy proxy forms for Grandbridge, MEC, and related entity AGMs. Mr Breeze sought to access the Electronic Proxy Reconciliation and discovered it was locked[19].

[30] Mr Breeze became suspicious and searched Ms Ambrosini's computer. He discovered emails which revealed the plans to remove him as Managing Director of MEC[20].

[31] On 21 November 2016, Mr Breeze attended the Grandbridge office. He confronted Ms Ambrosini and demanded that she allow him to inspect the physical file containing the proxy votes. Ms Ambrosini gave him the file and the password to the Electronic Proxy Reconciliation. The following day, Mr Breeze summarily dismissed Ms Ambrosini[21].

[32] On 23 November 2016, a board meeting of MEC was held in Mr Breeze's absence. The MEC Board voted to terminate the service agreement between Trandcorp and MEC, pursuant to which Mr Breeze had been performing the function of Managing Director of MEC[22].

[33] Mr Breeze sought to revoke the Grandbridge MEC proxy which had been completed by Ms Ambrosini and Mr Hollingsworth but was not permitted to do so at the MEC AGM held on 24 November 2016. Consequently, Mr Breeze has lost the income and control associated with performing the role of Managing Director of MEC[23].

[34] After the MEC AGM, Mr Foster and Ms Hughes attended the Grandbridge office and removed MEC papers, corporate folios and computing equipment[24].

[35] On 23 and 25 November 2017, Ms Ambrosini and Mr Hollingsworth respectively resigned as Directors of Grandbridge, leaving Grandbridge with only one director. Having locked Ms Hughes and Ms Foster out of the office, having dismissed Ms Ambrosini, and with Ms Wiburd on annual leave, Mr Breeze was without staff and under significant personal, legal, emotional and financial strain dealing with the consequences of the events which had unfolded[25].

[36] On Saturday 26 November 2016, Mr Breeze prepared a letter terminating Ms Wiburd's employment (Termination Letter). In his written statement he admits that:

"It was inconceivable to me that Wiburd had not known about that [the plan to remove him] and had not been involved in that. However, whilst I had very strong suspicious I did not have, at that point conclusive proof. But I knew that I could not take the risk to keep her as an employee.

I could not trust her at all and I decided to terminate her employment and I prepared her termination letter in advance of her returning to work." [26]

[37] On 27 November 2016, Ms Hughes called Ms Wiburd to let her know that Mr Breeze had dismissed Ms Ambrosini[27].

[38] On her return to work from annual leave on 28 November 2016, Ms Wiburd discovered the locks to the Grandbridge office had been changed. She rang Mr Breeze in order to obtain access to the office. Mr Breeze let her into the office and asked to speak with her in the boardroom[28].

[39] Mr Breeze asked Ms Wiburd if she had the backup drive which contained the Grandbridge corporate records. She advised him that she did not have it[29].

[40] Mr Breeze and Ms Wiburd disagree as to the order in which the following events occurred. Ms Wiburd says that Mr Breeze handed her the Termination Letter which he had prepared on 26 November 2016 and told her that she was summarily dismissed. She says that he then handed her a single email chain and told her that it indicated that she had acted dishonestly in conjunction with Ms Ambrosini. Mr Breeze says that he showed her three email chains and that he did so before handing her the Termination Letter. They both agree she denied acting dishonestly[30].

[41] Mr Breeze then asked Ms Wiburd to remain in the office and assist him to obtain access various banking and software codes. Ms Wiburd agreed to do so and spent an hour or more assisting Mr Breeze[31].

[42] Later that afternoon at around 3.00pm, Ms Wiburd called Mr Breeze and asked if she could return to the office to collect some items she had left behind. Mr Breeze agreed she could do so. Ms Wiburd returned to the office and removed a file from her office. Mr Breeze said he had only given approval for Ms Wiburd to collect some bills. Ms Wiburd said she did not specifically indicate that she intended to only collect her bills. She says that she collected the termination letter and a folder which contained her employment contract as well as the unpaid bills. She says that she made no secret of what documents she removed and, in fact, showed Mr Breeze the documents she had extracted from the file before departing from the Grandbridge office. Mr Breeze conceded at the Hearing that she did, in fact, show him what she was removing but he did not check it carefully[32].

[43] Mr Breeze alleges that Ms Wiburd removed the only company copy of variations to both her own and Ms Ambrosini's employment contracts, which removed an entitlement to the payment of one month per year of service on termination. He subsequently made a police report alleging Ms Wiburd had stolen these documents[33].

[44] A few days later, Ms Wiburd returned to the office to collect other personal belongings. Mr Breeze refused to permit her to enter and recover her personal belongings. At the time of the Hearing, these items had not yet been returned to Ms Wiburd[34].

[45] Mr Breeze says that he subsequently reviewed Ms Wiburd's email account and discovered further correspondence which indicated that Ms Wiburd was actively involved in the plan to remove him as managing director of MEC[35].

[7] Mr Breeze confirmed that Grandbridge had employed Ms Wiburd on or about 17 January 2007 to undertake duties that included accounts payable and receivable, and entry of bills of payment into the banking system[36]. Ms Wiburd assisted in preparation of cash flows, organisation of pays and the calculation of superannuation payments. The back-up of the database, taking home each day a hard drive of the backed up database, working for the other companies related to Grandbridge, namely MEC and BPH Energy Ltd, and working on proxy reconciliations also fell within the scope of Ms Wiburd's duties.

[8] Ms Wiburd worked alongside other employees of MEC including Mr Toby Foster (Mr Foster) and Ms Natascha Hughes (Ms Hughes)[37] and had over time, as noted, established what Mr Breeze considered to be a close working relationship with Ms Ambrosini to the extent that they had become friends[38].

[9] There were, according to Mr Breeze, some accepted practices when it came to voting at the annual general meetings for the companies related to Grandbridge. Mr Breeze said that voting at annual general meetings was done by proxy unless the shareholder was to personally attend the meeting[39]. Ms Wiburd and Mr Hughes would complete an excel document which recorded the entity/person and vote, and the same spreadsheet would compute the calculations relating to the vote and outcome[40]. This excel document was referred to, at first instance, as the Electronic Proxy Reconciliation document and will similarly be referred to as such in this decision.

[10] Mr Breeze said he had always filled in the proxy documents for Grandbridge and the related companies usually at the same time[41], namely after Ms Wiburd had provided him the proxy documents with some parts complete with the exception of the voting section[42].

[11] Mr Breeze noted that historically Ms Ambrosini and Mr Hollingsworth had never filled out or signed the proxy voting forms together and had never emailed proxy documents to each other[43]. Mr Breeze observed that Ms Ambrosini had never travelled to Melbourne to fill in proxy documents with Mr Hollingsworth and Ms Wiburd had never, in the past, emailed proxy documents to Mr Hollingsworth or Ms Ambrosini[44].

[12] Items for the annual general meeting were circulated and there had never been a board meeting or other meeting to decide formally which way to vote as issues were discussed, there was no dissent between Mr Hollingsworth, Ms Ambrosini or Mr Breeze, and Mr Breeze said that he would sign the proxy and Ms Ambrosini would countersign[45].

[13] On 26 October 2016, Ms Wiburd informed Mr Breeze about some sick leave and proposed annual leave dates between 18 November and 25 November 2016.

[14] A sequence of events thereafter unfolded concerning Grandbridge, its related companies, Mr Hollingsworth, Ms Ambrosini, Ms Wiburd and Mr Breeze. In short form the events are elucidated in the earlier part of this decision having been extracted from the Decision of the Deputy President at first instance.

[15] Reference is made to a Mr Breeze's growing suspicions that something was occurring and consequently he reviewed Ms Ambrosini's emails on 20 November 2016[46]. On doing so Mr Breeze discovered a series of emails in which Ms Wiburd and Ms Ambrosini had engaged in the following communication:

a) on or about November 2015 an email referring to Mr Breeze as 'disgusting' [47];

b) on or about 3 December 2015 emails referring to hating Mr Breeze[48];

c) 13 January 2016, Ms Wiburd encouraged Ms Ambrosini via email to deceive Mr Breeze[49];

d) 21 March 2016, Ms Wiburd expressed to Ms Ambrosini that she could not stand Mr Breeze[50];

e) 14 June 2016, Ms Wiburd and Ms Ambrosini exchanged emails in which they sought to cover up for Ms Ambrosini not being in the office[51];

f) 15 July 2016, further emails between Ms Wiburd and Ms Ambrosini expressed hatred toward Mr Breeze and that he was a disgusting human being[52];

g) 17 August 2016, Ms Wiburd and Ms Ambrosini described Mr Breeze as a 'stupid fool' and 'an idiot'[53]; and

1. on or about 20 September 2016, Ms Wiburd and Ms Ambrosini communicated via Facebook (the messages located on Ms Wiburd's work computer) in which they describe Mr Breeze as 'vile' and Ms Wiburd suggests leaking particular news about Mr Breeze to hotcopper.

[16] Mr Breeze admitted that he had not been aware of the abovementioned emails until he had reviewed them on 20 November 2016[54]. The full extent of the emails was not revealed he said, until he looked at Ms Wiburd's emails a relatively short time after the date that he dismissed her[55].

[17] However, Mr Breeze gave evidence that he had viewed three email exchanges between Ms Wiburd and Ms Ambrosini before dismissing Ms Wiburd, and Mr Breeze attested to having shown the email exchanges to Ms Wiburd at a meeting on 28 November 2016[56].

[18] First is the email of 18 June 2015 from Ms Ambrosini to Ms Wiburd the text of which provides:

Going to be in about 11.30 having small melt down today. Can you please just say I have an app[57].

[19] Next is the email of 15 February 2016 from Ms Ambrosini to Ms Wiburd the text of which provides:

Running late can you please make up some reason for me. Sorry it had been a crazy morning thanks to my instructor being late !! It wasn't even me this time[58].

[20] Next is a chain of emails between Ms Ambrosini to Ms Wiburd sent at various times on 14 June 2016 the text of which provides:

Going to be late. Farrier is very late and there are no staff here so I have to wait. Sorry Di it's a disaster at the moment[59]

I'm home alone YS!! DB & Toby (I guess) at meeting[60].

Oh that awesome. Can you turn my computer on and if he gets back tell him I went to a meeting. Just make my office look like I was there. Maybe put a coffee cup on my desk near the computer. My password is Davies05[61].

Thanks Di I am at the insurance broker to get d and o policies ☺[63].

Just told DB at insurance meeting and have been in ☺[64].

[21] On 11 November 2016, Mr Breeze asked Ms Wiburd where the proxy forms were and Ms Wiburd informed Mr Breeze that Ms Ambrosini had taken them home[65]. Mr Breeze says that it was around this time that he looked at the proxy forms that Ms Wiburd and Ms Ambrosini had provided a few days earlier and he realised that the forms were for himself and Trandcorp but not for Grandbridge[66]. Mr Breeze said he had always been given the proxy forms for Grandbridge in the past[67].

[22] Come 19 November 2016, Mr Breeze having returned from a business trip in Melbourne, attempted to access the Electronic Proxy Reconciliation document on the central company computer, only to find that an electronic lock had been placed on Grandbridge and its related companies, and his access was denied[68].

[23] On 20 November 2016, Mr Breeze accessed the work computer of Ms Ambrosini, looked at her emails and printed some of them[69].

[24] Mr Breeze provided the following evidence regarding the events of 21 November 2016:

The only time I was able to see the physical copies of the proxy forms was when I came into the office after hours on the 21 November 2016 (I had been at home all day working) Ambrosini was at the office and she had the proxy file with her. I asked her to let me look at it and she did so. She was shaking. While I was looking at the files she said that she had to go home now. She left while I was still reading the file. At that time, I copied the proxy form. Ambrosini's email to me dated 21 November at 3.57pm shows that she had placed a lock on the proxy reconciliation document and she told me, at the same time, that Wiburd also knew the code (see DB26E). I looked at the physical proxy reconciliation that evening. I put revised votes into the proxy the next morning after I had dismissed Ambrosini for cause. I saw that a vote for Grandbridge had been made without my knowledge or agreement that afternoon, 21 November, Ambrosini sent me the email at 3.57pm. Next to GBA was a highlight I recognized it was a key highlight and they knew this .if [sic]this vote was changed the whole outcome of the meeting changed. This was deception causing massive damage.

It was on 21 November that I realised what Ambrosini, Hollingsworth and the others involved in MEC had done and were going to do.

I was now dealing with a crisis and dealing with much more than the dismissal of Ambrosini. My main concern was how to change the vote at the MEC AGM. This was the start of a very crucial week. I had overwhelming suspicions about what is [sic] going to happen but I could not alert Ambrosini Hollingsworth [sic] or the others what I suspected. But I did know that I had to get rid of Ambrosini as soon as possible because I could not trust her at all.

I also knew, at that time, that I had to dismiss Wiburd. I had lost all trust in her. But she was still on leave and I knew that I had to deal with Ambrosini first. In addition, I believed that Wiburd had a crucial hard drive backup with all of the company's electronic files and I needed to get it back[70].

[25] By 26 November 2016, Mr Breeze turned his mind to the return of Ms Wiburd from leave on the Monday. He stated:

... Ambrosini was now gone and so were Foster and Hughes. It was my view that they had all been involved in the conspiracy for quite some time and they had made detailed plans that they had kept from me. It was inconceivable to me that Wiburd had not known about that and had not been involved in that. However, whilst I had very strong suspicions I did not have, at that point conclusive proof. But I knew that I could not take the risk to keep her as an employee. She was far too dangerous because of her close friendship with Ambrosini and because I now knew that she had acted dishonestly in conjunction with Ambrosini, in the past (see the e-mails that I gave her just before terminating hr employment). I could not trust her at all and I decided to terminate her employment and I prepared her termination letter in advance of her returning to work. (Attached and marked with the letter DB30).

[26] The termination letter prepared by Mr Breeze set out that the reasons for Ms Wiburd's dismissal were threefold. First, because she had lied to him, second she had acted in a manner inconsistent with the policies of the company and third her actions were an egregious violation of the code of conduct[71]. The dismissal was to take effect immediately[72].

[27] Ms Wiburd acknowledged that Mr Breeze was her boss[73].

[28] Her evidence was that she had no knowledge of what was referred to as Project Deer[74] and she did not get involved with matters related to proxy votes beyond recording information about them on an excel spreadsheet[75], and taking instructions from Mr Breeze or Ms Ambrosini regarding the proxies[76].

[29] At hearing, Ms Wiburd acknowledged that she did not lock the Grandbridge proxy documents and stated 'Well, I've never locked the documents'[77]. Ms Wiburd said that the only one she knew was locked was the BPH[78]:

Sorry, the MEC? --- As far as I know, as I said before, close of business, when I left on the 17th, the only company that was locked from my recollection of that time, for my purpose, the only one that was locked was BPH..

Can I ask you to look at page 174? --- Yes, I can read.

You may not know the answer to this, but Ms Ambrosini you're saying that she's sure that you have already told Mr Breeze the password, but you hadn't, had you? --- No, I hadn't. He hadn't asked.

You knew - the reason why you didn't tell Mr Breeze the password, is because you knew that he wasn't supposed to know it, didn't you? --- No, that is not correct. He did not ask me. If David had asked me, I would have told him.

[30] When asked whether Ms Wiburd had given the Grandbridge proxy form to Mr Breeze, Ms Wiburd stated that she was not asked to do so[79]. Ms Wiburd's evidence on this point:

Did he ask you to give him the ones you gave him? --- Yes, or Deborah told me to give them to him. I didn't do it on my own behalf, on my own volition, I am told to do these things.

She gave you the forms to give to Mr Breeze? --- No, she would have told me to print out the forms to give to him.

Which forms did she tell you to print out? --- I would imagine all of them. I do not recall. It wasn't an issue, as far as I could - I did not know subsequently, what has happened.

You accept that Mr Breeze would normally transfer the Grandbridge proxy form? ---Yes.

He had done on every other occasion that you have been involved, hadn't he? ---I wasn't that often involved, but I can't see any reason why he wasn't.

You say that you didn't give - that you didn't - and you entered those proxies that you gave to Mr Breeze, you entered them into the reconciliation document, didn't you? --- As far as I can remember, yes.

But you say that you didn't enter the Grandbridge proxy into that reconciliation? --- As far as I know, I didn't, from memory, because Deborah Ambrosini had that proxy and I didn't see it, as such, as far as the signed document.

But you knew that she had it? --- Only when I saw it entered onto the proxy list, you know, the excel spreadsheet, is what I'm saying sorry[80]

[31] Ms Wiburd agreed that it would normally be the case that that Mr Breeze would transfer the Grandbridge proxy form[81]. However, when asked whether Ms Wiburd had told Mr Breeze that the Grandbridge proxy had been done she said:

---He didn't ask. I didn't even - I did not enter it. Whether it had been done or not, I did not enter it. As I said, Ms Ambrosini entered it, or I presume she did. I did not enter it. I did not go through and look at ---

You said that you saw the Grandbridge proxy in that reconciliation document? ---A line in a spreadsheet.

When did you see that? --- I don't know[82].

[32] Further, Ms Wiburd conceded that she had never emailed proxy forms to Mr Hollingsworth or Ms Ambrosini save on the occasion that Ms Ambrosini ventured to Melbourne[83].

[33] Ms Wiburd disagrees that she was shown three emails by Mr Breeze before he opted to terminate her employment but admits to having written the relevant email on 14 June 2016 that formed part of the Termination Emails[84].

[34] Mr Howlett, Counsel for Grandbridge (Mr Howlett), submitted that there had been a history and pattern of dislike, hatred and contempt toward Mr Breeze shared by Ms Wiburd and Ms Ambrosini[85]. It was said that Mr Breeze was aware of most of those things as at 26 November 2016 when Mr Breeze prepared the termination letter[86]. Dislike, hatred and contempt were things, said Mr Howlett, that went to the implied duties of loyalty, honesty and mutual trust[87].

[35] The proxy reconciliations were part of Ms Wiburd's job and she had always done it in a particular way previously until November 2016[88]. Mr Howlett advanced that Ms Wiburd knew that all of the things that happened in relation to the proxies in or about November 2016 differed to how they were done before[89]. Mr Howlett said that given the number of employees it was inconceivable that Ms Wiburd had no knowledge of Project Deer[90]. Ms Wiburd knew that a lock had never been put on the Grandbridge Electronic Proxy Reconciliation document before and she had the password, which she did not provide to Mr Breeze, because he did not ask[91].

[36] The termination letter, or rather its contents, must be considered, said Mr Howlett, against the context in which Mr Breeze was operating[92]. It was an absolute crisis for Mr Breeze and his priority was to change the outcome of the MEC annual general meeting[93]. Mr Howlett said that it was clear that Mr Breeze had lost trust in Ms Ambrosini and it followed that it was entirely understandable that he had lost all trust in Ms Wiburd. This was because of the combination of factors he was aware of and dealing with in the week commencing 20 November 2016, and arguably two to three weeks prior to that date[94].

[37] Mr Heathcote, Counsel for Ms Wiburd (Mr Heathcote), advanced that Ms Wiburd had not engaged in serious misconduct and in doing so he reflected on the email of 14 June 2016 in which Ms Wiburd conceded that she had lied when informing Mr Breeze that Ms Ambrosini had been in. With regard to that email Mr Heathcote characterised the conduct of Ms Wiburd as being trivial in the total scheme of things[95] particularly when Ms Wiburd had followed the direction of a company director, whom she considered to be her boss[96].

[38] Whilst conceding that the Commission was not bound to follow the provisions of the employment contract, Mr Heathcote referred to paragraph 11.1 termination without notice. Mr Heathcote stated that termination without notice required a 'serious or persistent breach that is not remedied within 14 days' and he referred to subparagraph (b), which set out 'guilty of grave misconduct or wilful neglect where the breach is not remedied within 14 days'. What was clear from the contract, according to Mr Heathcote, was that the parties did not really anticipate that there would be summary dismissal for something trivial that couldn't be fixed[97].

[39] Ms Wiburd's inaction of not providing Mr Breeze with a copy of the proxy was a case of following a direction from Ms Ambrosini[98] and it was clear, said Mr Heathcote, that Ms Wiburd knew nothing of Project Deer[99]. There was according to Mr Heathcote no evidence that Ms Wiburd hated or held no respect for Mr Breeze, rather it was more the case that Ms Ambrosini had engaged in venting over email. Mr Heathcote further submitted that if it was the worst case, and Ms Wiburd did hate Mr Breeze and had no respect for him that, he said, was not a basis for summary dismissal.

[40] It was not contested by the parties that the dismissal was by way of genuine redundancy[100]. Further, I am satisfied that Ms Wiburd was protected from unfair dismissal[101] and that her Application was made within the required period as prescribed in ss.394(2) of the Act.

[41] Having considered the evidence, I am satisfied that Grandbridge is a small business employer as defined in s.23 of the Act and that Ms Wiburd was not provided with notice on termination but rather was summarily dismissed on 28 November 2016. Neither party advanced an argument to the contrary.

[42] It follows then, that the question to be presently resolved is whether Grandbridge was compliant with the Code at the time of Ms Wiburd's dismissal. So much was clear from the referral of the Full Bench in Grandbridge Limited v Mrs Diane Wiburd[102]. Therefore, the focus quite rightly rests on whether the Code was complied with and initially that requires consideration of the Summary Dismissal aspect of that Code.

[43] Unsurprisingly, Ms Wiburd submitted that her dismissal was non-compliant with the Code.

[44] Section 396 of the Act provides that, before considering the merits of an application for unfair dismissal remedy order, the Commission must determine some other initial matters which include:

(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.

[45] A person has not been unfairly dismissed where the dismissal is consistent with the Code. It is useful to set out s.388 of the Act:

(1) The Minister may, by legislative instrument, declare a Small

(2) A person's dismissal was consistent with the Small Business Fair

(a) immediately before the time of the dismissal or at the time the person was given notice of the dismissal (whichever happened first), the person's employer was a small business employer; and

(b) the employer complied with the Small Business Fair

[46] The Code is only relevant if the employer is a small business as defined in s 23 of the Act.

[47] The Code provides:

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. Serious misconduct includes theft, fraud, violence and serious breaches of occupational health and safety procedures. For a dismissal to be deemed fair it is sufficient, though not essential, that an allegation of theft, fraud or violence be reported to the police. Of course, the employer must have reasonable grounds for making the report.

In other cases, the small business employer must give the employee a reason why he or she is at risk of being dismissed. The reason must be a valid reason based on the employee's conduct or capacity to do the job.

The employee must be warned verbally or preferably in writing, that he or she risks being dismissed if there is no improvement. The small business employer must provide the employee with an opportunity to respond to the warning and give the employee a reasonable chance to rectify the problem, having regard to the employee's response. Rectifying the problem might involve the employer providing additional training and ensuring the employee knows the employer's job expectations.

In discussions with an employee in circumstances where dismissal is possible, the employee can have another person present to assist. However, the other person cannot be a lawyer acting in a professional capacity.

A small business employer will be required to provide evidence of compliance with the Code if the employee makes a claim for unfair dismissal to Fair Work Australia, including evidence that a warning has been given (except in cases of summary dismissal). Evidence may include a completed checklist, copies of written warning(s), a statement of termination or signed witness statements.

[48] The 'Summary Dismissal' section of the Code clearly applies to dismissals that have 'immediate effect' as that term is understood by reference to the decision in Ms Li Li Chen v Australian Catering Solutions Pty Ltd T/A Hearty Health[103], and are not dismissals on notice[104].

[49] Without being exhaustive, in Ryman v Thrash Pty Ltd t/a Wisharts Automotive Services (Ryman) the Full Bench provided a useful synopsis of the proper approach to the construction and application of the Summary Dismissal aspect of the Code and its interaction with Regulation 1.07 of the Fair Work Regulations 2009 (Cth) (Regulations).

[50] In Ryman the Full Bench considered the meaning of 'summary dismissal' and said that it referred to a dismissal without notice arising from 'a breach of an essential term of the employment contract, a serious breach of a non-essential term or the contract, or conduct manifesting an intention not to be bound by the contract in the future on the part of the employee'[105].

[51] However, it is not the case that under the Code the Commission has to be satisfied that serious misconduct was the basis for the dismissal[106]. Rather, there needs to be a consideration whether, at the time of dismissal, the employer held a belief that the employee's conduct was sufficiently serious to justify immediate dismissal and one must also consider whether that belief was based on reasonable grounds[107]. This element, which has been described as the second element[108], incorporates the concept that the employer has carried out a reasonable investigation into the matter[109]. It is not necessary to determine whether the employer was correct in the belief that it held[110]. Whether the employer had 'reasonable grounds' for the relevant belief is of course to be determined objectively[111].

[52] The focus on 'serious misconduct' must be taken as identifying the subject matter and it appears to be accepted that this term gleans its meaning from s.12 of the Act and thereafter Regulation 1.07 of the Fair Work Regulations 2009 (Cth)[112].

[53] In applying these requirements I must also have regard to the procedural matters highlighted within the Code.

[54] If the Applicant's dismissal was consistent with the Code, it cannot be considered to be unfair within the meaning of the Act.

[55] Grandbridge communicated to Ms Wiburd that her employment was terminated for cause and would take effect immediately. While the termination letter referred not to 'serious misconduct', it nevertheless traversed the conduct of lying, acting in a manner inconsistent with the policies of the company and an egregious violation of the code of conduct. Grandbridge, in my view, had clearly informed Ms Wiburd through the absence of notice and by reference to the aforementioned types of conduct that her dismissal was by way of summary dismissal.

[56] The question then turns on whether Grandbridge complied with the Code given it was accepted that it was a small business employer, particularly the section of the Code headed Summary Dismissal. In assessing whether there was such compliance it is necessary first to determine whether Grandbridge genuinely held the belief that Ms Wiburd's conduct was sufficiently serious to justify immediate dismissal. The Full Bench, correctly in my view, said that it seemed 'self-evident that the belief held by Grandbridge can only relate to the conduct of Ms Wiburd about which Grandbridge was aware at the time of the dismissal'[113].

[57] It is apparent that at the time of Ms Wiburd's dismissal Mr Breeze had suspicions regarding Ms Wiburd's conduct to the extent that he expressed that on 21 November 2016 he had concluded that he had lost trust in her. By 26 November 2016, Mr Breeze said that he knew that he could not take the risk to keep her as an employee because she had acted dishonestly in conjunction with Ms Ambrosini and he could not trust her at all.

[58] Mr Breeze's belief that Ms Wiburd had acted dishonestly with Ms Ambrosini appeared to arise from his review of three emails that I have collectively termed the Termination Emails against a context in which there were clear deviations from the usual practice within Grandbridge.

[59] Of the three emails, two involved requests by Ms Ambrosini to Ms Wiburd to provide excuses for her tardiness, one being that she had an appointment. Much was made by Mr Heathcote concerning the triviality of the emails, particularly with reference to the 'half truth' in the third email of 14 June 2016, and the contention that Ms Wiburd was simply following the instructions of Ms Ambrosini.

[60] With regard to the email of 14 June 2016, Mr Heathcote submitted that Ms Wiburd knew that Ms Ambrosini had not been in the office however she had followed instructions and did what she was asked to do.

[61] Ms Wiburd's duty was to her employer. That duty of fidelity extended to being honest with her employer which in this case was Mr Breeze. Having viewed the email of 14 June 2016, it was readily open on the evidence for Mr Breeze to form a belief that Ms Wiburd had participated in a deception and had not simply been compliant with a lawful and reasonable instruction. On any view, it was open for Mr Breeze to deduce that Ms Ambrosini's instructions to Ms Wiburd in the Termination Emails were not lawful and reasonable and that on at least one occasion Ms Wiburd had complied with the instruction.

[62] On the evidence, I further consider it was open for Mr Breeze to have held the belief that there was a level of comfort or familiarity between Ms Ambrosini and Ms Wiburd to the extent that Ms Ambrosini was not reticent in asking Ms Wiburd to conduct herself dishonestly on her behalf; and on 14 June 2016 Ms Wiburd was not opposed to complying with Ms Ambrosini's request notwithstanding she would be engaging in dishonesty with her employer. Clearly, Ms Wiburd was willing to lie on behalf of Ms Ambrosini.

[63] It would appear understandably that Mr Breeze's belief concerning Ms Wiburd's conduct was further reinforced when over the course of 18 June 2015 and 15 February 2016, Ms Ambrosini had sent the two emails to Ms Wiburd asking her to lie on her behalf. While there is no evidence to suggest that Ms Wiburd complied with the request from Ms Ambrosini on those dates, in the context where Mr Breeze had read the email dated 14 June 2016, it was open to him to believe that Ms Wiburd may have engaged in the deception with Ms Ambrosini.

[64] It is not the case that Grandbridge was required to establish that Ms Wiburd had a duty to report the misdeeds of Ms Ambrosini. It is generally accepted that there exists not such a duty save where provided in an employment contract, or the placement of the employee within the business is such that the duty arises or the circumstances[114].

[65] Further, it was unnecessary in my view to adduce evidence to show that Ms Wiburd had actually provided to Mr Breeze fabricated reasons for Ms Ambrosini's tardiness. What is more the point is that the Termination Emails in and of themselves were capable of giving rise to a belief that the employee who reported into Mr Breeze, namely Ms Wiburd, had engaged in deception.

[66] It is true that the Termination Emails were sent over the course of 12 months, namely 18 June 2015, 15 February 2016 and 14 June 2016. While they are interspersed over a period this does not in any way impugn the genuineness of the belief held.

[67] Whether or not Mr Breeze's belief that Ms Wiburd's conduct was sufficiently serious to justify immediate dismissal requires consideration of whether the belief was based on reasonable grounds. This relevantly incorporates that the employer has carried out a reasonable investigation into the matter.

[68] Mr Breeze's discovery of the Termination Emails occurred in circumstances where I am satisfied that the usual processes that had been adopted in the past regarding the completion of proxy forms for Grandbridge and its related companies, and the use of the Electronic Proxy Reconciliation document had deviated. Importantly, the evidence, in my view established that Ms Wiburd was aware of such deviations but chose not to inform Mr Breeze whom she acknowledged in evidence was her 'boss' and Mr Breeze at the relevant time had become aware of this.

[69] Mr Breeze gave uncontested evidence that there had been accepted practices when it came to voting at the annual general meetings for all of the companies related to Grandbridge. Voting at the annual general meeting was done by proxy unless the shareholder was to personally attend[115]. It was Ms Wiburd who provided the proxy documents to him. Some of the parts would be completed with the exception of the voting section.

[70] Ms Wiburd and Mr Hughes would record the entity/person and vote on the Electronic Proxy Reconciliation document, and that same spreadsheet would compute the calculations relating to the vote and outcome[116]. From the evidence it would appear that it was not usual for the Electronic Proxy Reconciliation document to be locked.

[71] Mr Breeze said he had always filled in the proxy documents for Grandbridge and the related companies usually at the same time[117], after Ms Wiburd had provided him the proxy documents with some parts completed[118]. It is therefore unsurprising that come 11 November 2016, when Mr Breeze asked Ms Wiburd for copies of the proxies which had been lodged for the upcoming Grandbridge, MEC, and related company annual general meetings and Ms Wiburd informed Mr Breeze that Ms Ambrosini had taken the file containing the proxies home, his suspicion was raised.

[72] When asked whether Mr Breeze would normally transfer the Grandbridge proxy form Ms Wiburd said 'yes', and in reply to being asked whether on every other occasion that Ms Wiburd had been involved him regarding the transfer she replied 'I wasn't that involved, but I can't see any reason why he wasn't.'

[73] Concerning the entry of proxies on the Electronic Proxy Reconciliation document, Ms Wiburd admitted that she would enter the proxies she gave to Mr Breeze onto the document. However, with regard to the Grandbridge proxy that was referred to on 11 November 2016, Ms Wiburd recalled that she did not enter the proxy onto the Electronic Proxy Reconciliation document because Ms Ambrosini had the proxy. Ms Wiburd clarified that she only knew Ms Ambrosini had the proxy for Grandbridge when she saw it entered into the reconciliation document.

[74] On 19 November 2016, Mr Breeze attended the Grandbridge office and was unable to locate the hard copy proxy forms for Grandbridge, MEC, a related entity's annual general meetings and discovered the Electronic Proxy Reconciliation document was locked[119]. Mr Breeze's evidence was that no lock had been put on the electronic proxy reconciliation documents before.

[75] On 21 November 2016, Mr Breeze received an email from Ms Ambrosini showing that she had placed a lock on the Electronic Proxy Reconciliation document and that Ms Wiburd knew the code. Ms Wiburd's evidence was that she knew the code, had not given it to Mr Breeze but would have if he had asked.

[76] Come 26 November 2016, and having dealt with issues with Grandbridge, its related companies, terminating the employees Ms Ambrosini, Ms Hughes and Mr Foster, Mr Breeze turned his mind, he said, to the ongoing employment of Ms Wiburd, who was due back from leave.

[77] Mr Breeze had enquired into why he did not have the proxy form for Grandbridge, and had discovered the lock being placed on the Electronic Proxy Reconciliation document. He had considered the email which disclosed that Ms Wiburd was aware of the lock being placed on the Electronic Proxy Reconciliation document. Further, he had reviewed the Termination Emails, which were direct evidence showing that Ms Wiburd had conducted herself dishonestly and had done so with an employee Mr Breeze saw fit to dismiss, because of her deception, namely Ms Ambrosini.

[78] The evidence that Mr Breeze had shown Ms Wiburd all of the emails constituting the Termination Emails before informing her of her dismissal was disputed. I am nonetheless satisfied, based on the evidence before me, that Mr Breeze had conducted a reasonable investigation given the circumstances of this matter.

[79] Mr Breeze dismissed Ms Wiburd for lying, acting in a manner inconsistent with the policies of the company and an egregious violation of the code of conduct[120]. Mr Heathcote quite correctly submitted that Ms Wiburd appeared unaware of any relevant policy such as an Information Technology policy and that Grandbridge did not in fact have a code of conduct[121]. Mr Heathcote advanced that even on its worst day the conduct of Ms Wiburd could not be that of serious misconduct[122]. Mr Howlett submitted that the Commission should consider the context in which Mr Breeze was operating when he pre-prepared the termination letter for Ms Wiburd. That context was a state of crisis where Mr Breeze was the only remaining employee in Grandbridge with the exception of Ms Wiburd and he had been focused on how to change the vote at the MEC annual general meeting[123]. The evidence before me supports the very contention made by Mr Howlett.

[80] I am satisfied that while there was not a breach of a non-existent code of conduct or a relevant policy, the evidence before Mr Breeze was that he believed Ms Wiburd had lied to him or otherwise engaged in deception. Serious misconduct as understood in the Code, takes its meaning from Regulation 1.07 and in doing so includes wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the employment contract.

[81] When Mr Breeze enquired into the actions of Ms Wiburd regarding the Termination Emails he formed a belief that she had lied or otherwise engaged in deception. To cause an employer to believe something that was not true is not trivial conduct. Such conduct went to the very heart of the duty Ms Wiburd owed to Grandbridge, to be honest. The surrounding circumstances cannot be ignored. Mr Breeze was very aware that Ms Wiburd had been privy to the usual practices around the completion of proxy documents and those practices had been deviated from. Ms Ambrosini had placed a lock on the Grandbridge Electronic Proxy Reconciliation document, yet Ms Wiburd never said anything to Mr Breeze. It appears most reasonable to have arrived at a belief that the trust between Grandbridge and Ms Wiburd was eroded.

[82] In light of my aforementioned consideration of the matter, I consider there was credible basis for a belief being held that Ms Wiburd had engaged in serious misconduct. I am therefore satisfied that at the time of dismissal, Grandbridge held a belief that Ms Wiburd's conduct was sufficiently serious to justify immediate dismissal and the belief was based on reasonable grounds.

[83] Having been asked to determine the question of whether Grandbridge complied with the Code in relation to Ms Wiburd's dismissal my answer is in the affirmative. Consequently, Ms Wiburd's Application is dismissed.

[1] Respondent's further submissions [2] and [3].

[8] Ibid [10] and Exhibit R2 at [1.8].

[12] Exhibit R1 at [1.5] and Exhibit A5 at [22].

[13] Exhibit A5 at [53]-[54] and Attachment DB18 and DB18A.

[25] Exhibit A5 at [87] and [97]-[98] transcript PN1488.

[27] Exhibit R2 at [4.4] transcript at PN1486.

[28] Exhibit A5 [102]-[103] and Exhibit R2 at [4.2]-[4.6].

[29] Exhibit A5 [103] and R2 at [4.7]-[4.8].

[30] Exhibit R2 at [4.9]-[4.10] and Exhibit A5 [104]-[106].

[31] Exhibit A5 [107] and Exhibit R2 at [4.14] and Transcript at PN185.

[32] Exhibit A5 [110]-[113] and Exhibit R2 at [4.15] Transcript at PN260 and PN1405.

[36] Witness Statement of David Breeze (Breeze Statement) [20].

[48] Breeze Statement [24]; Exhibit DB4.

[49] Breeze Statement [26] Exhibit DB5.

[50] Breeze Statement [27] Exhibit DB6.

[51] Breeze Statement [29] Exhibit DB8.

[52] Breeze Statement [31] Exhibit DB10.

[53] Breeze Statement [32]; Exhibit DB11.

[56] Transcript PN490, PN 547, PN 1024.

[57] Email from Ms Ambrosini to Ms Wiburd on 18 June 2015 at 9.25am.

[58] Email from Ms Ambrosini to Ms Wiburd on 15 February 2016 at 9.25am.

[59] Email from Ms Ambrosini to Ms Wiburd on 14 June 2016 at 9.24am.

[60] Email from Ms Wiburd to Ms Ambrosini on 14 June 2016 at 9.27am.

[61] Email from Ms Ambrosini to Ms Wiburd on 14 June 2016 at 10.25am.

[62] Email from Ms Wiburd to Ms Ambrosini on 14 June 2016 at 10.27am.

[63] Email from Ms Ambrosini to Ms Wiburd on 14 June 2016 at 10.50am.

[64] Email from Ms Wiburd on 14 June 216 at 11:25am.

[65] Breeze Statement [71] Exhibit DB26C.

[70] Ibid [78], [79], [80] and [81].

[74] Witness Statement of Ms Wiburd (Wiburd Statement) [5.1].

[102] [2017] FWCB 6732.

[103] [2017] FWC 3930 [62]-[64].

[104] Ryman v Thrash Pty Ltd t/a Wisharts Automotive Services [2015] FWCFB 5264 [36].

[106] Ibid [37] - [38]; Grandbridge Limited v Mrs Diane Wiburd [2017] FWCFB 6732 [28];

[107] Pinawin T/A RoseVi.Hair.Face.Body v Domingo [2012] FWAFB 1359.

[109] Ibid [29] cited in Ryman v Thrash Pty Ltd t/a Wisharts Automotive Services [2015] FWCFB 5264 and referred to in Grandbridge Limited v Mrs Diane Wiburd [2017] FWCFB 6732 [39].

[112] Grandbridge Limited v Mrs Diane Wiburd [2017] FWCFB 6732 [28]; Ryman v Thrash Pty Ltd t/a Wisharts Automotive Services [2015] FWCFB 5264 [37].

[113] [2017] FWCFB 6732 [30].

[114] Sybron Corp v Rochem Ltd [1984] Ch 112 [126].

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