Qi v. Nice Shoes Australia Pty Limited [2005] NSWIRComm 1149

Industrial Relations Commission (NSW)|2005-07-09|Before: Wright J, Marks J

CITATION: Qi v. Nice Shoes Australia Pty Limited [2005] NSWIRComm 1149

APPLICANT Wei Qi PARTIES: RESPONDENT Nice Shoes Australia Pty Limited

CATCHWORDS: termination of employment - alleged unfair dismissal - out-of-time claim - resignation - constructive dismissal - conflict in the evidence - costs application

LEGISLATION CITED: Industrial Relations Act 1996

Allison v. Bega Valley Council (1995) 63 IR 68 Attorney General v. Wentworth (1988) 14 NSWLR 481 Burns v. Grigg (1967) VR 871 General Steel Industries Inc v. Commissioner for Railways (1964) 112 CLR 125 Griffith Ex-Services Club Limited v. Federated Liquor and Allied Industries Employees' Union of Australia (1993) 51 IR 186 CASES CITED: Jones v. Dunkel (1959) 101 CLR 298 Mitchelson v. Mitchelson (1979) 24 ALR 522 Parker v. Capitol Painters Pty Limited (1996) 68 IR 100 Skelly v. Prouds Jewellers Pty Limited (1994) 53 IR 3 Spanish Club Case (1999) 94 IR 173 Waine v. BHP Steel - unreported

APPLICANT Martin Churchill

LEGAL REPRESENTATIVES: RESPONDENT Mark Thompson Ren Zhou Lawyer

DECISION: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

Application under S.84 of the Industrial Relations Act, 1996

1 Pursuant to the provisions of Part 6, Unfair Dismissals, of Chapter 2, Employment [Ss.83 to 90] of the 1996 Industrial Relations Act, an application has been lodged (by a friend) on behalf of Ms Wei Qi who had been employed as a shop assistant with Nice Shoes Australia Pty Limited which operates four shoe stores - at Burwood, Ashfield, Liverpool and Marrickville. Ms Qi worked alone at the Ashfield store. Mr William Lin is the proprietor of Nice Shoes. Ms Qi commenced employment on Monday, 10 May, 2004 with him and her services terminated on Friday, 3 December, 2004. There were issues related to her work performance - frequent private telephone calls and reading a newspaper during working time - which Ms Qi disputes. But Nice Shoes claim that she, in fact walked out, ie resigned and, as such, her Part 6 application is beyond jurisdiction. Ms Qi also allegedly took money that she claimed to be owing to her as salary.

2 In her Part 6 application Ms Qi has sought monetary compensation under S.89(5). Her claim was allocated to me by Registry staff and set down by them for a conciliation and directions hearing on Thursday, 17 February, 2005 and a mention on Thursday, 10 March, 2005. Conciliation failed to settle the matter. I programmed it for arbitration which occurred on Wednesday, 8 June, 2005. I made directions for the filing of evidentiary material in the customary manner. Ms Qi was to file and serve her material by no later than Monday, 11 April, 2005. She filed that material on Tuesday, 5 April, 2005. Nice Shoes was to file its evidentiary material by no later than Monday, 2 May, 2005. It did so.

3 However, on Friday, 3 June, 2005 a substantial amount of further evidentiary material was provided for and on behalf of Ms Qi. She would have the right for some brief evidentiary material in response to the case presented on behalf of Nice Shoes on Monday, 2 May, 2005 but that would be confined to the material already brought into evidence by Nice Shoes - not to produce a substantial body of fresh evidence. Consequently, Mr Zhang, representing Nice Shoes, wrote to me to inform me that it would be opposing that material being brought into evidence.

4 In the Spanish Club Case (1999) 94 IR 173 the Full Bench of the Commission (Wright J - President, Marks J and Bishop C) declined to grant leave for an appeal against a decision at first instance to exclude affidavits into evidence since they had not been provided in accordance with directions made and without proper reasons being given for that failure. The Full Bench took the view (at p.173) that the exclusion of the affidavits was within the discretion of the member of the Commission. I accept that the course approved by the Full Bench in the Spanish Club Case should not be followed where it would obviously constitute an unfairness to the party which has not complied with the directions. But in this case, in my opinion, it would constitute an unquestionable unfairness to Nice Shoes to admit material in evidence at this late stage which, on its face, so obviously is new material. Indeed, some of that additional material appears to me not be particularly relevant for the Part 6 application mounted by Ms Qi.

5 But all of that argument becomes somewhat academic. At the commencement of the hearing on Wednesday, 8 June, 2005, Mr Churchill, now representing Ms Qi, indicated that his client had difficulties in communicating in English. She had made no request for a Mandarin interpreter (but apparently believed that she had done so). I have formed the impression that she understands English sufficient for her to understand the nature of these proceedings but I appreciate that she may be more comfortable relying on an interpreter. In any event, Mr Lin also has difficulties in communicating in other than Mandarin - and his difficulties in that respect are more acute than Ms Qi's. In those circumstances, it was appropriate to vacate the hearing on Wednesday, 8 June, 2005 and reschedule it on Wednesday, 7 September, 2005, arranging in the meantime for a Mandarin interpreter to assist both Ms Qi and Mr Lin. That gave Mr Thompson, now representing Nice Shoes, with sufficient time to consider the nature of the late material provided on behalf of Ms Qi.

6 It has also been claimed in Ms Qi's Part 6 application that she was not paid all of her entitlements under the Shop Employees (State) Award. It has been estimated by her that she is owed $36,259.52. It appears to me that from the outset that has been her chief area of concern. She has been assisted in her claim in that respect by a friend whom, she describes as an "industrial expert" and who has prepared correspondence on her behalf on Wednesday, 8 December, 2004 making a claim with respect to the alleged underpayment of her wages (but making no reference to a claim for alleged unfair dismissal). That claim for underpayment is strenuously rejected by Nice Shoes. In any event, that is a claim which she is required to mount before an industrial magistrate or the local courts. Pursuant to S.380(1) I do hold jurisdiction to entertain a small claim for alleged underpayments, viz:

"An industrial organisation may, during any proceedings before the Commission, make an application for an order under this Part and for the application to be dealt with under S.379."

But as the words I have highlighted above indicate, that remedy is restricted to an "industrial organisation", ie a trade union and, as the Full Bench of the Commission (Glynn and Hungerford JJ and Connor C) confirmed in its unreported decision of Wednesday, 10 February, 1999 in Maldoc Pty Limited v. Bollard [Matter No. IRC 2710 of 1997], an individual dismissed employee in Part 6 proceedings is not competent to make such a small claim. Moreover, small claims of that nature are confined to the recovery of unpaid rates of pay of $10,000.00 or less. Ms Qi's claim, of course, far exceeds that ceiling.

7 Furthermore, there are two jurisdictional issues which arise with Ms Qi's Part 6 application. Firstly, Ms Qi's Part 6 application was lodged out-of-time. She did so only on Tuesday, 1 February, 2005. A time limit is imposed on the lodging of Part 6 applications. S.85(1) provides as follows:

"Any application under this Part must be made not later than 21 days after the dismissal."

8 Ms Qi's Part 6 application falls outside that time limit by over one month. She has recorded in her Part 6 application that she:

"...was unaware of the requirements to lodge the application within a 21 day period, plus I needed to find work for my support..."

She has asserted that she discovered her entitlement to mount a claim under Part 6 through the internet on her personal computer early in 2005. Of course, as Mr Thompson suggested, she could have done that earlier - and in the time provided in S.85(1).

9 Whether or not to admit and out-of-time claim form is a matter for my discretion. Under S.85(3) members of the Commission hold a discretion to accept an out-of-time Part 6 application if they consider that there is sufficient reasons for doing so. In determining whether there is sufficient reason to hear an out-of-time Part 6 application, S.85(3) directs them to have regard to a number of specific matters: (i) the reason for, and the length of, the delay, (ii) any hardship that may be caused to the applicant if the claim is denied or the employer if it progressed and (iii) the conduct of the employer.

10 Ordinarily, it is a question of determining where the balance of convenience lays: whether a late applicant employee should be denied a remedy or the respondent employer be put to the considerable inconvenience which may arise for him from a late application [Griffith Ex-Services Club Limited v. Federated Liquor and Allied Industries Employees' Union of Australia (1993) 51 IR 186 at p.191]. In Parker v. Capitol Painters Pty Limited (1996) 68 IR 100 I stated (at p.101) that:

"…in my view, it is not appropriate to adopt a restrictive approach in exercising my discretion under S.85(3). It is a question of balancing the competing interests of (the applicant) and (the respondent)…"

Nevertheless, the prima facie position is that the 21 day time limit should be followed: it is a clear instruction of the legislature that the time limit should be imposed and to depart from it there must be some material upon which to exercise the discretion in favour of an out-of-time Part 6 applicant [ Skelly v. Prouds Jewellers Pty Limited (1994) 53 IR 3 at p.5]. Otherwise the time limit in S.85(1) would be meaningless. The 21 day time limit for the lodgement of Part 6 applications is hardly a recent innovation: it has been a feature of the Part 6 jurisdiction for in excess of fifteen years. Ms Qi has clearly slept on her rights and her claim would, in my opinion, fail on that basis alone.

11 Moreover, the other jurisdictional problem - the allegation that Ms Qi walked out of the employment and was not dismissed at all - is something which would weigh on my discretion under S.85(3) to permit her Part 6 claim to go forward. In my opinion, the prospect of ultimate success for a Part 6 applicant is also a factor to take into account when considering whether or not to accept an out-of-time Part 6 application. In my unreported decision of Monday, 8 October, 2001 in Waine v. BHP Steel [Matter No.IRC 3138 of 2001] I commented in that respect (at p.4) that:

"…whilst it is not specifically referred to in S.85(3), it seems to me that one of the factors which I must take into account in determining whether or not to exercise my discretion and admit an out of time Part 6 application, is the prospect of such a Part 6 application ultimately succeeding if it is considered on its merits. That is a common approach by courts and tribunals [ Burns v. Grigg (1967) VR 871 at p.872 and Mitchelson v. Mitchelson (1979) 24 ALR 522 at p.524]. Essentially, if an out of time Part 6 applicant is unlikely to succeed, it goes without saying that to refuse his claim will not, in fact, constitute the type of hardship to the dismissed employee referred to in S.85(3). It would do nothing more than delay the inevitable and (avoid) considerable cost and inconvenience to both parties…"

12 The allegation that Ms Qi walked out on her employment, if substantiated, would take her Part 6 application out of jurisdiction under Part 6. S.84(1), the central plank of Part 6 applies only to cases where:

"…an employer dismisses an employee and the employee claims the dismissal is harsh, unreasonable or unjust…"

It is trite to say that if an employee walks out of her employment, she is not dismissed. The decision to terminate her contract of employment is her own decision and it is tantamount to a resignation. Such cases would only fall under Part 6 if it can be established that the termination of the employee's services was, in effect, a constructive dismissal [ Allison v. Bega Valley Council (1995) 63 IR 68]. It is in that light that I turn to consider the evidence before me in this hearing.

13 Mr Churchill called Ms Qi to give evidence in the proceedings. She asserted that she was changing the prices on the shoes when on Friday, 3 December, 2004 Mr Lin entered the store - at approximately 3.30pm. According to Ms Qi, at first Mr Lin ignored her but later he answered the telephone and became very angry with her. He yelled at her that she should not give the telephone number for the store to her friends. Evidently, the caller on the telephone had claimed a wrong number and hung up the telephone. Mr Lin obviously had formed the view that the telephone call was a personal call for Ms Qi and that when he answered the telephone instead of Ms Qi, the caller had simply hung up the telephone.

14 In her written statement Ms Qi recorded that Mr Lin had said:

"You must not give your working number." Ms Qi denied that she had done so and that none of her friends knew the telephone number for the store. She claimed to Mr Lin that the only private telephone call she had received was one occasion when her sister telephoned at work.

15 Mr Lin then "...jumped, became hot and his face became red...", ie he was angry. He allegedly said:

"I do not like you at all. You mustn't let anyone come to the shop to see you and let anyone know your number. You should not get phone calls."

Ms Qi claimed that she told Mr Lin not to talk to her in that manner and, ultimately, Mr Lin told her:

"I want you to leave. Take the two days pay that is owing to you from the till. Leave a note saying you have taken the money."

Ms Qi did so. She took some cash out of the cash register - apparently $175.50 - and left the store approximately 90 minutes before the store was to close.

16 Mr Thompson called Mr Lin to give evidence in the hearing. Mr Lin claimed that when he entered the store on Friday, 3 December, 2004 he observed a number of customers looking at shoes and trying them on whilst Ms Qi was on the telephone. She was not marking prices on the shoes as she alleged. Mr Lin has limited English and when the customers left the store, he asked Ms Qi in Mandarin:

"When customers are in the shop, can you stop your phone calls if its not related to business and serve customers?"

The rest of the conversation was also in Mandarin. Ms Qi responded:

"I just made one phone call. Making phone calls is important so that I can keep in contact with my family."

"You are not allowed to call family members during work unless it is an emergency."

"I am not going to work for you anymore. I am going home now."

Mr Lin told her that Ms Qi was obliged to give him notice of her intention to resign or at least finish working at the end of the day. Mr Lin claimed that Ms Qi responded with words to the following effect:

"I do not care about your business. I will take the money and go."

Ms Qi withdrew $175.50 from the cash register and left the store.

18 Mr Lin spoke to his wife on the telephone after Ms Qi had left the store. He informed her what had occurred, viz:

"Ms Qi left angrily and I have to stay at work. Ring her and tell her that she can't go and has to give us notice."

Mr Thompson called Mrs Lin to give evidence in the hearing. She indicated in her evidence that she had telephoned Ms Qi and told her that she could not leave her employment without giving notice. Mrs Lin recalled Ms Qi saying:

Mrs Lin asked Ms Qi why she had left the employment and Ms Qi replied:

19 Further telephone calls were made to Ms Qi by Mrs Lin but she did not return those telephone calls. On Wednesday, 15 December, 2004 Mrs Lin telephoned Ms Qi on another person's mobile telephone and Ms Qi did answer that telephone call (suggesting to her - and me - that she was avoiding her). Mrs Lin said to Ms Qi:

Ms Qi confirmed that she would not be returning to work for Nice Shoes when she said:

20 As I have indicated earlier in this decision, the fact that Ms Qi lodged her Part 6 application late - and did not, in my opinion, give a satisfactory explanation for her delay in lodging her Part 6 application - takes her Part 6 application outside jurisdiction. I have also found the version of events by Mr Lin and his wife to be more plausible and, on balance, I prefer it. I therefore conclude that Ms Qi actually walked out of her employment with Nice Shoes on Friday, 3 December, 2004, ie she resigned. I have formed that view for several reasons, viz:

(i) in a statement attached to her Part 6 application Ms Qi indicated that she "...had received one phone call while in the shop...", that she "...didn't expect the call..." and that she "...did not make any calls from the shop, only receiving the one call..."; that statement is at odds with her evidence and her claim in her evidence that she was speaking about a previous incident is not credible, in my opinion;

(ii) the "industrial expert" who was her friend was not called to give evidence in the hearing by Mr Churchill and Mr Thompson has argued that his failure to do so raised the inference that his evidence would not have assisted her in her arguments [ Jones v. Dunkel (1959) 101 CLR 298];

(iii) whilst I am satisfied that Ms Qi has sufficient grasp of English to communicate effectively with English speaking customers, Mr Lin would have difficulties in that respect: it would seem to me very unlikely that Mr Lin would have left the store without somebody who would be able to deal effectively with customers; and

(iv) I am convinced that Mrs Lin had offered Ms Qi that her job was open for her but that Ms Qi rejected that offer and, indeed, attempted to avoid Mrs Lin.

An employee who brings her employment to a conclusion by walking out on her employer cannot expect to find a remedy under Part 6.

21 That is unless the purported resignation is a constructive dismissal, ie it was forced on the employee by the employer. Neither Mr Churchill nor Mr Thompson raised the issue of constructive dismissal in these proceedings. And, in my opinion, it does not apply in this case. For a resignation to be accepted as a constructive dismissal, the employer must have done some act which brings the employment to an end. As the Full Bench of the Commission (Peterson and Marks JJ and Connor CC) indicated Allison v. Bega Valley Council (at p.72):

"…Although the term 'constructive dismissal' is quite commonly used, it can deflect attention from the real inquiry. That inquiry should involve an analysis of what occurred. Did the employer behave in such a way so as to render the employer's conduct the real and effective initiator of the termination of the contract of employment and was this so, despite on the face of it, their employer appears to have given his or her resignation? …"

Clearly, on the evidence before me, it was Ms Qi who intended to bring her employment to a close and it was not Mr Lin's intention to dismiss her. I therefore see no grounds for my intervention in support of Ms Qi in this hearing and I do not propose to do so. 22 Mr Thompson has also argued for costs against Ms Qi and Mr Churchill made a counter-claim in that respect. Costs in Part 6 proceedings are confined by S.181(2)(c), viz:

"...the Commission may award costs against a party to proceedings under Part 6 of Chapter 2 (Unfair dismissals), who, in the opinion of the Commission, unreasonably failed to agree to a settlement of the claim or whose application was frivolous or vexatious..."

Mr Thompson's application for costs would be on the basis that Ms Qi's claim is frivolous or vexatious.

23 In order to bring a case within the description of frivolous and vexatious action it is therefore not sufficient merely to say that the applicant has no cause of action - as is the case here. It must appear that the cause of action is, on the face of it, clearly one which no reasonable person could properly treat as bona fide and contend that she has a grievance which she was entitled to bring before the court. It means litigation which is not brought in good faith and merely seeks to annoy or embarrass an opponent or which is not designed to produce any practical result. Roden J of the State Supreme Court in Attorney General v. Wentworth (1988) 14 NSWLR 481 held (at p.491) that a proceeding was vexatious if it was instituted with the intention of annoying or embarrassing a respondent, if it was brought for collateral purposes and not for having the court adjudicate on the issues or, irrespective of motive, it was so obviously untenable or manifestly groundless as to be utterly hopeless [General Steel Industries Inc v. Commissioner for Railways (1964) 112 CLR 125 at p.129].

24 Whilst I am satisfied that Ms Qi's Part 6 application had no merit, I do not believe that it was frivolous or vexatious. I dismiss the claim for costs against her. I also dismiss Mr Churchill's counter-claim for costs as there are no grounds for such a claim in these proceedings.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.

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