Victorian Civil and Administrative Tribunal|2009-12-22

Stern v Depilation & Skincare Pty Ltd (Anti-Discrimination) [2009] VCAT 2725 (22 December 2009)

Anti-discrimination - complaint of pregnancy discrimination during employment and by terminating employment - whether direct discrimination occurred - what compensation should be ordered - Equal Opportunity Act 1995 ss7, 8, 10, 14, 102 and 136

Stern v Depilation & Skincare Pty Ltd (Anti-Discrimination) [2009] VCAT 2725

Pursuant to section 136 of the Equal Opportunity Act 1995 (the EO Act) this tribunal orders-

It finds the complaint proven in part. It finds that the respondent directly discriminated against the complainant on the basis of her pregnancy, in contravention of section 14 of the EO Act by changing her employment status during her employment and by terminating her employment.
The respondent must by 7 January 2010 pay to the complainant, as compensation for the loss, damage or injury found by the tribunal to have been suffered by her in consequence of the contravention of the EO Act mentioned in paragraph 1 a total of $6607.58 made up as follows -
- (a) for loss arising from the change of her employment status during her employment - $3000;
- (b) for loss of earnings - $2807.58;
- (c) for humiliation and emotional distress - $800.
In all other respects, the tribunal finds the complaint not proven and dismisses it.

I have found that the respondent (the company) directly discriminated against the complainant (Ms Stern) on the basis of her pregnancy during her employment and by terminating that employment. By doing so, it breached s14 of the Equal Opportunity Act 1995 (the EO Act). My orders set out the various kinds of compensation which I award in respect of those breaches. In all other respects, the complaint is not proven and dismissed.

On 21 April 2009, Ms Stern lodged a complaint against the company with the Victorian Equal Opportunity and Human Rights Commission (the Commission) under the EO Act. The complaint claimed pregnancy discrimination in employment. Under s113 of the EO Act, the Commission notified the parties that it considered that it was not reasonably possible to conciliate the complaint successfully. Ms Stern, as she had a right to do under the EO Act, required the Commission to refer her complaint to VCAT. It did so by letter dated 25 June 2009.
Throughout the processing of this complaint through VCAT, the parties have not been represented by lawyers. The tribunal directed that the complaint stand as Ms Stern's particulars of complaint, and that the company file particulars of defence. It also directed that the parties file witness statements. They have done all these things.
I heard this case for three days commencing on 9 November 2009. At the hearing, Ms Stern was represented by her father, Mr Stern, and the company was represented by its industrial association's representative, Mr Tindley.
I first say something about the law. I then consider the evidence and make findings. Finally, I consider whether the company has breached the EO Act and, if it has, what remedy (if any) should be ordered.

Ms Stern's claim is that, because of her pregnancy, the company treated her less favourably than it did other employees in various ways. This is a claim of direct discrimination. Indirect discrimination is not claimed.
As far as direct discrimination is concerned, the effect of ss7, 8, 10 and 14 of the EO Act is relevantly this. Discrimination includes direct and indirect discrimination on the basis of an attribute. Section 6 lists the attributes on the basis of which the Act prohibits discrimination. Pregnancy is one of these.
Direct discrimination occurs if a person treats someone with an attribute less favourably than the person treats or would treat someone without that attribute or with a different attribute, in the same or similar circumstances. The attribute need not be the only or dominant reason for the treatment, but must be a substantial reason for it. This means that the attribute must be a reason of substance for that conduct.[1] The motive of the discriminator is irrelevant, and it is also irrelevant whether the discriminator was aware of the discrimination or considered the treatment less favourable. Discrimination is based on the relevant attribute if (among other things) its basis is that the person has the attribute or had it at any time, whether or not at the time of the discrimination. [2]
Among other things, s14 prohibits an employer from discriminating against an employee by dismissing the employee or otherwise terminating his or her employment, or by subjecting the employee to 'any other detriment'. The cases have said that detriment includes any kind of real or significant disadvantage.[3] Under s4(1) of the EO Act, humiliation and denigration are specifically included in the meaning of 'detriment'.
The effect of s102 is relevantly this. If any employee in the course of employment, or an agent while acting as agent, does something which breaches the Act or, if the employer or principal had done that thing would breach the Act, then the employee or principal, as well as the employee or agent, are taken to have engaged in that conduct, and a complaint may be made against any of them. Section 103 contains an exception to this rule which is not relied on here.

Ms Turner asks for compensation from the company. Under s136 of the EO Act, if the tribunal finds a complaint or part of it proven, it may (among other things) order the respondent to pay to the complainant within a specified time 'an amount the tribunal thinks fit to compensate the complainant for loss, damage or injury suffered in consequence of' the breach of the EO Act. The amount of compensation is to be judged in a common sense and practical way, and care must be taken not to underestimate the amount in a way that trivialises the important principles of the legislation.[4]

It is for the complainant to prove her case. The standard of proof is the balance of probabilities - that is, a fact is proved if the complainant satisfies the tribunal that it is more probable than not that it occurred.
Here, the complainant does not say that the company or its agents told her directly that she was being made redundant because of her pregnancy. She asks the tribunal to infer that this was so. For the tribunal to be able to make such an inference, it must be satisfied that the evidence supports, not just some inference of general discrimination, but pregnancy discrimination of the kind claimed. The tribunal must be satisfied that there was no equally or more probable innocent explanation of the conduct.[5]

For the complainant, I have witness statements and heard oral evidence from Ms Stern herself, and from her fiancé Mr Watson. For the company, I have witness statements and have heard oral evidence from Ms Simonetti and Ms Argyrou, the company's two directors and owners of its beauty therapy salon business, and from the company's employees, Ms Doumis, Ms Tonasi and Ms Langham. I have also a witness statement and heard oral evidence from the company's accountant, Mr McNeill.
My approach to the evidence is this. For the most part, I am satisfied that all the witnesses gave truthful and reliable evidence. However, in some instances, I have given some of the evidence little weight, and in others I have preferred the evidence of some of the witnesses to others. The fact that I have preferred the evidence of some witnesses to others does not mean that I regarded the evidence of the other witnesses as wholly unreliable. I give some examples.
First, on a number of occasions I have preferred the evidence of Ms Argyrou and Ms Simonetti to that of Ms Stern, because I regarded some of Ms Stern's evidence as springing from a belief that all the actions towards of her of Ms Simonetti and Ms Argyrou sprang from a deliberate and malicious plan to terminate Ms Stern's employment because of her pregnancy. I find that this was an unfounded belief.
Second, I have given little weight to Mr Watson's evidence about what Ms Stern told him about conversations between Ms Stern and others, in which Mr Watson had not participated. I prefer the direct evidence of the participants in these conversations.
Third, Ms Simonetti's oral evidence was on a number of occasions confused and vague. It also appeared from her oral evidence that she had discussed parts of her witness statements with Ms Argyrou. Indeed, one paragraph of Ms Simonetti's witness statement refers to 'Ms Simonetti and I' (meaning, 'Ms Simonetti and Ms Argyrou'), suggesting that Ms Simonetti had at least in this instance simply copied Ms Argyrou's witness statement. Ms Argyrou was a less confused and more compelling witness and, where the evidence of Ms Argyrou and Ms Simonetti conflicts, I prefer that of Ms Argyrou.
Fourth, I have regarded the evidence of Ms Doumis with caution because, in my view, her witness statement was in one respect inconsistent with her oral evidence. Her witness statement said that the friendship between her and Ms Stern did not extend beyond work. But, under cross-examination, she agreed that she had been invited by Ms Stern to her engagement party and that she had invited Ms Stern to her 'hen's night'.
Fifth, there are a number of documents in exhibit B (tendered on behalf of Ms Stern but with the respondent's consent) which appear to be witness statements of people who did not give evidence before the tribunal and could therefore not be questioned either by the tribunal or the respondent. There was no satisfactory explanation why Ms Stern did not or could not have called these people to give evidence. I give no weight to these documents.
Finally, I regarded the accountant Mr McNeill as a truthful and reliable witness.

For the past 15 years, Ms Simonetti and Ms Argyrou have been the directors and owners of the company which conducts a beauty therapy salon business in Templestowe. From the payroll records of the business which are in evidence, while the business may be described as a relatively small one, it is not insignificant. It has about ten employees and (at least during the period December 2008 to April 2009) a monthly wages bill ranging between $35,000 and $42,000. The directors are 'hands on'. They work in the business.
The nature of the beauty therapy business is that the therapists who work in it perform a variety of treatments for clients such as facials, massages, and electrolysis. Most of these are performed by the therapists while standing, but electrolysis is performed by the therapist when seated. Generally, however, therapists spend most of their time at work in the salon on their feet.
In this industry, therapists' hours of work are typically long. The company's salon is no exception. The work also includes night work, to cater for those clients who wish to have their beauty therapy in the evening.
Until October 2008, the therapists employed by the company would typically work three 12 hour shifts per week (from 9.00 am to 9.00 pm) and one eight hour shift per week (from 9.00 am to 5.00pm). In October 2008, Ms Simonetti and Ms Argyrou changed these shift hours to two 12 hour shifts per week, and two eight hour shifts per week. I find that this was due to a decision to close the business on Friday evenings. Ms Argyrou and Ms Simonetti gave evidence that the decision was also to help Ms Stern, who was then pregnant. I do not find this evidence convincing.
In late 2008, the company suffered a downturn in its business. While (according to Mr McNeill, its accountant) trading figures for September and October 2008 showed that the company was still profitable, they showed that business was slowing noticeably when compared with business at the end of the previous financial year. Mr McNeill discussed this difficulty with Ms Argyrou and Ms Simonetti, and how the situation might be redressed. Since 70 per cent of the business' overheads related to staffing, Mr McNeill discussed with them the possibility of staff reduction. Figures for the first nine months of the financial year 2008/09 show that the business operated at a loss of approximately $15,000 and that its income had reduced by approximately 17 per cent.
I accept the evidence of Ms Simonetti and Ms Argyrou that, from about June 2009 onwards, the business began to improve rapidly.

Ms Stern has worked in the beauty therapy industry for about three years. In February 2008, she began employment with the company. She was then aged 21. She did not sign any employment agreement and was not given any copy of written terms and conditions of employment. On Ms Stern's evidence and the evidence of the employees of the company, Ms Langham, Ms Tonasi and Ms Doumis, it seems that the company followed no consistent practice on this matter. Some employees signed written contracts when they began working with the company. Others signed them at some time during their work with the company. Others did not sign any.
I have already made findings about the weekly shifts which the employees worked from February 2008 to October 2008, and the way in which those shifts changed in October 2008. On the issue of what breaks were allowed to employees, I accept the evidence of Ms Argyrou and Ms Simonetti in preference to that of Ms Stern. During each 12 hour shift, the company's employees had two breaks - an hour at about lunch time, and a half hour in the late afternoon. For each eight hour shift, they had a one hour break.
In October 2008, the employee's shifts were changed from three 12 hour shifts per week to two 12 hour shifts per week, and from one eight hour shift per week to two eight hour shifts per week. For each 12 hour shift, they were now given two half hour breaks - one at about lunch time and one in the late afternoon. For each eight hour shift, they had a half an hour break.
In October 2008, Ms Stern told Ms Argyrou and Ms Simonetti that she was pregnant. Before this, there had been no major disputes between her and Ms Argyrou and Ms Simonetti. They encouraged her to train in the provision of electrolysis (in her own time) and provided her equipment for the purpose and allowed her to practice on certain clients. I accept their evidence that, when Ms Stern told them that she was pregnant, they expressed happiness.
I accept Ms Stern's evidence that, after telling Ms Simonetti and Ms Argyrou that she was pregnant, she asked more than once in October 2008 for her hours to be reduced. She explained that she was struggling to stay on her feet, she was tired, and she had morning sickness. She asked Ms Simonetti if she could still keep her full time hours and work a five day week and eight hour shifts daily. Ms Simonetti did not refuse outright, but told Ms Stern that she would see what she could do. I prefer Ms Simonetti's evidence to Ms Stern's on this point because it is consistent with the evidence given by the company's other employees.
Ms Simonetti then approached all but two of the other employees and asked them if they would change their hours so that Ms Stern's request could be accommodated. She did not approach two of the employees because she was certain that they would refuse. All the employees whom she approached refused to change their hours.
After discussing the matter with Ms Argyrou, and on about 20 November 2008, Ms Simonetti asked Ms Stern to put her request in writing. Ms Stern did this by letter dated 28 November 2008, given to Ms Argyrou and Ms Simonetti on 29 November 2008. In that letter, Ms Stern said that, since her original request for eight hour shifts five days a week had been declined and it had been suggested that she cut back her hours, she now requested shifts of 1.00 pm to 9.00 pm on Wednesdays, 9.00am to 5.00 pm on Thursdays and Fridays and 9.00 am to 5.00 pm on Saturdays. The letter explained that she was struggling with 12 hour shifts on her feet and with night shifts.
After discussing Ms Stern's letter, Ms Argyrou drafted a letter (which she and Ms Simonetti signed) to Ms Stern dated 1 December 2008. It was given to her on 3 December 2008. It characterised Ms Stern's request as a request that 'your employment status to be changed from full time to part time'. It refused this request because 'there are no part time positions available at this stage'. It went on to say that this was the busiest time of the year for the beauty industry, especially 'our night appointments', and 'we require all staff to work to the capacity that they have been employed'. It said that they had gone to great lengths to work out how to reduce Ms Stern's hours temporarily. It then suggested a number of other measures -
- Longer or more frequent breaks throughout the day;
- That a co-worker had offered to work Ms Stern's Thursday morning shift from 9.00 am to 1.00 pm until Christmas;
- That other staff could be booked first and Ms Stern could be 'block- booked' allowing her to leave if she had no further bookings for the day;
- That Ms Stern could go 'upstairs' and have power-naps throughout the day.
On the evidence of Ms Argyrou and Ms Simonetti, which I accept, these were measures which they had in the past adopted for pregnant employees. The letter went on to say that the situation would be reviewed in the new year.
I make the following findings about whether the above suggestions were implemented. As to the offer of a co-worker to work four hours out of Ms Stern's Thursday shift, it is not clear from the evidence that this suggestion was implemented, and indeed it seems that Ms Stern's hours then changed again before the suggestion could have been implemented. As far as longer breaks were concerned, I accept the evidence of Ms Argyrou and Ms Simonetti that, while the breaks of other employees working the 12 hour shifts were reduced from one and a half hours to one hour in total, Ms Stern's total breaks remained at one and a half hours (for the short time during which she continued to work the 12 hour shift). While the breaks of other employees for the eight hour shift were reduced from one hour to half an hour, Ms Stern's breaks for that shift remained at one hour. Ms Stern's evidence was that she was not given longer breaks, but I find that effectively she was given longer breaks than other employees.
As to 'block-bookings', Ms Stern's evidence is that she was block-booked occasionally, but that it was uncertain on any day whether or not this would occur. The evidence of Ms Argyrou and Ms Simonetti was that the nature of the beauty industry is that clients of the salon, even though they are regarded as regular clients, came at irregular intervals, and not regular days. Their evidence was that they attempted to block-book Ms Stern wherever possible. I accept their evidence.
As to power-naps, Ms Stern's evidence was that Ms Simonetti and Ms Argyrou told her to keep busy and not to stand around, and she did not feel able to take power-naps. She also said that had to continue to do heavy cleaning work, to carry laundry bags up and down stairs, and to carry heavy buckets of water to and from the pedicure room. She agreed that Ms Simonetti and Ms Argyrou had made sure that she did not have to undertake massage treatments (which involved heavy physical work), but that her request to be removed from this task had been dealt with with such delay that she was unwilling to make any further requests.
The evidence of Ms Argyrou and Ms Simonetti was this. They believed that Ms Stern should not undertake massage treatment of clients while she was pregnant, and agreed to a request to cease that treatment as soon as it was made. They made it clear to Ms Stern that she should not climb the stairs at their premises except when absolutely necessary. While they required other employees to undertake the cleaning duties which Ms Stern would normally have undertaken, they left it to Ms Stern to determine when she needed to 'power nap' and did not prevent her from taking power-naps. Since Ms Stern performed very few pedicures, and each pedicure room had water supplied to it, there was no need for Ms Stern to carry heavy buckets full of water from one room to another. I regard their evidence as more convincing, and accept it. Given that Ms Stern made repeated requests to have her hours reduced, asked that she not undertake massage treatments, and (in 2009) complained to her employers about leave loading entitlements, it is my view that, if Ms Stern had considered these matters to be a serious issue, she would not have hesitated to complain about them.
I find that Ms Simonetti and Ms Argyrou in their letter of 1 December 2008 treated Ms Stern's request for reduced hours while retaining her full time employment status, as a request to change her employment status from full time to permanent part time. This was not what Ms Stern requested. I accept the evidence of Ms Simonetti and Ms Argyrou that this was the first request of such a kind that they had received from a pregnant employee. In the past, their pregnant employees had made requests such as to change their employment status to casual employment or to be given leave. The only other evidence concerning how the company treated requests made by other employees (not on the ground of pregnancy) to have working hours changed or reduced is this.
Ms Argyrou's and Ms Simonetti's evidence (which I accept) is that, in February 2009 their employee Ms Castelan sought leave to look after her dying mother. Ms Castelan was a part time employee. She was told that she could have as much leave as she needed. There was no suggestion that her employment status would be changed.
One of the employees who gave evidence was Ms Doumis. She was a full time employee whose oral evidence was that she had asked Ms Simonetti if she could change her working hours from three 12 hour shifts and one eight hour shift per week, to two 12 hour shifts and two eight hour shifts per week. Ms Simonetti told her that they could not do this at present, but would accommodate this request as soon as they could. The request was made orally. I accept Ms Doumis' evidence that, shortly after this, and without any further written or oral requests from her, her hours were changed as she requested. I also accept her evidence that she has now orally asked Ms Simonetti and Ms Argyrou if she could reduce her hours from two to one eight hour shift per week. She has been told that this will happen after Christmas 2009.
On 29 November 2008 there was a staff meeting. Ms Argyrou and Ms Stern were present, and a number of other employees, but it is not clear who. Ms Stern's evidence was that Ms Argyrou humiliated her in front of the other staff by commenting on how hard it had been for another employee to become pregnant and by saying to Ms Stern 'you don't have cancer, Carla, you're just pregnant'. Ms Argyrou's evidence was that these comments were made in the context of other comments that Ms Stern should embrace her pregnancy and would be okay. I accept all of this evidence. While I find that Ms Argyrou's comments may have been more appropriately phrased and made with more forethought, I am not prepared to find that, viewed objectively, they constituted humiliation or were intended to constitute humiliation.
On 3 December 2008, Ms Argyrou and Ms Simonetti met with Ms Stern. I accept that, at that meeting, they effectively repeated to Ms Stern what they had said in the letter of 1 December 2008. Ms Stern said in evidence (and Ms Simonetti and Ms Argyrou denied) that they told Ms Stern that they had advertised her job 'online' because they were not sure what she wanted to do. No copy of the advertisement was tendered. I am not prepared to find that this comment was made by Ms Simonetti or Ms Argyrou, or that they advertised her position online.
On 8 December 2008, Ms Simonetti and Ms Argyrou again wrote to Ms Stern. The letter was given to her on 10 December 2008. That letter further changed Ms Stern's working hours. The letter states the change was 'agreed' at the 3 December meeting but, on the evidence, I am not prepared to find that it was. It is not clear from the evidence why this further change was made. Ms Stern was now to work one 12 hour shift per week and two eight hour shifts. This arrangement was to apply until the new year 'with the exception of extra hours on the busy Christmas and new year weeks'. On the week in which the company reopened after the new year break, beginning on 12 January 2009, she was to work three eight hour shifts and one 12 hour shift. From the week beginning 19 January 2009 onwards, she was to work two eight hours and one 12 hour shift. The letter confirms that the twelve hour shift was to include two 45 minute breaks which could be longer 'if needed'. The letter states that, from 19 January 2009 on, Ms Stern would be working a 24.5 hours week.
I have found that Ms Stern was given a one hour break for each eight hour shift, and one and a half hours' break for each 12 hour shift. Her working arrangements from 19 January 2009 would therefore involve a total of three and a half hours' break. Including these breaks, her total hours would have been 28. I find that in fact the working hours stated in the letter of 8 December 2008 excluded her breaks, and infer from all the evidence that she was not paid for these breaks. This is consistent with the evidence of Ms Stern's payroll records from early 2008 when she would have been working three 12 hour shifts and one eight hour shift. She is shown as working a 37 or 38 hour week, while the total of three 12 hour shifts and one eight hour shift (including breaks) would have been 44 hours.
On 9 December 2008, Ms Stern replied to the letter of Ms Simonetti and Ms Argyrou. She gave that letter to them on 10 December 2009. She set out a different version of what she recollected had been said at the meeting of 3 December. She enclosed a medical certificate from her obstetrician, certifying that she was not able to work 12 hour shifts, and that she was to work no more than eight hour shifts 'at present'.
I find that, on the day they received the medical certificate, Ms Simonetti and Ms Argyrou changed Ms Stern's working hours to three eight hour shifts a week.

I have already found that there was a significant downturn in the company's business in late 2008 and early 2009, and that the company's accountant Mr McNeill advised Ms Simonetti and Ms Argyrou that the best way to overcome the issue was to reduce staff overheads. Ms Argyrou and Ms Simonetti did not want to do anything about this until after the busy Christmas period. They again discussed the matter at the end of 2008, and it was their view that there was a need to reduce approximately 40 staff hours per week. They had identified that this was this approximate number of hours during which there were no client bookings. This number of hours was the equivalent to the working hours of one full time employee.
Ms Simonetti and Ms Argyrou initially decided that the full time employee Ms Langham would be made redundant. She was the least busy of the full time employees. I accept that either Ms Simonetti or Ms Argyrou told the employees Ms Doumis, Ms Tonasi and Ms Velazquez that it was likely that Ms Langham would be made redundant. Although they did not tell Ms Langham, I accept Ms Langham's evidence that other staff had told her about this likely decision.
In mid-February 2009, Ms Castelan (a part time employee of the business) took leave to care for her sick mother. Two weeks later, on 28 February 2009, she resigned. She had been working 24 hours per week.
Ms Simonetti and Ms Argyrou had another discussion and agreed that, after Ms Castelan's resignation, they did not need to make redundant a full time employee, but (to make up the approximately 40 hours of reduction that they needed) only needed to make redundant a part time employee. They chose Ms Stern for redundancy. There evidence is that she was then working 21 hours per week. On the whole of the evidence, I find that she was in fact working three eight hour shifts (24 hours per week) and that the 21 hour figure excluded breaks, for which she was not paid. The evidence of Ms Simonetti and Ms Argyrou is that they needed to scale down the business, and it was this and not Ms Stern's pregnancy which was the sole reason for making her redundant.
Ms Stern's evidence is that the decision to make her redundant was taken solely because of her pregnancy. Ms Stern's evidence was that, since she told Ms Simonetti and Ms Argyrou that she was pregnant, they had on a number of occasions bullied and humiliated her, had not given her longer breaks, had required her to do heavy manual labour such as carrying laundry bags upstairs and carrying heavy buckets of water from room to room, had showed that she was targeted for redundancy at a staff meeting on 10 January 2009, had been hostile to her for raising leave loading entitlements, had referred her clients to other beauty therapists, and had criticised her for not selling enough products to the salon's clients. She also disputes that there was a downturn in the company's business, saying that Ms Doumis (one of its full time employees) worked additional hours in April 2009. All of this, she says, shows that there was a plan to get rid of her.
On the evidence, I am not satisfied that there was a plan by Ms Simonetti and Ms Argyrou, formulated as soon as she told them that she was pregnant, to target her directly for redundancy solely because of that pregnancy. I find that the redundancy occurred because of a downturn in the business, and that Ms Stern was chosen for redundancy because, after the resignation of one part time employee, she was a part time employee with hours that corresponded to the remaining number of hours that the business wanted to reduce. It is true that the employee Ms Doumis did work additional hours in April, but this does not mean that there was not a downturn in the business. I find that she did this because she was trying to attend to her own clients before she took a long period of leave to go on her honeymoon.
I am not satisfied that the comments relied on by Ms Stern to show that she was constantly humiliated by Ms Simonetti and Ms Argyrou were either (objectively viewed) humiliating or intended to humiliate. There is no evidence that Ms Argyrou's lending her a bassinet was for any other purpose except kindness. I have already made findings that Ms Stern was effectively given breaks longer than the other staff. I have found that she was not required to clean or to carry heavy buckets full of water, or to do work involving climbing up and down stairs.
While I am satisfied on the evidence that on 10 January 2009 at a staff meeting Ms Simonetti and Ms Argyrou told the staff that business was not going well and that within the next two months they would have to let some staff go, and that this may not be the last staff to be employed but the quietest employee, I am not satisfied that this was particularly directed to Ms Stern, or was part of a plan to get rid of her. While I am satisfied that, on the same date and after that staff meeting, Ms Stern raised with Ms Simonetti her leave loading entitlements, and was treated with hostility because of this, I am not satisfied that this had anything to do with her pregnancy. It is more probable than not, in my view, that it simply had to do with her raising her leave loading entitlements. I am not satisfied that Ms Simonetti and Ms Argyrou directed Ms Stern's clients to other therapists. Ms Stern was, after all, working far less hours, and would have been less available. None of Ms Stern's clients were called to give evidence.
On 28 January 2009, Ms Stern wrote to Ms Simonetti and Ms Argyrou that her last day of work before maternity leave would be 30 May 2009. I accept Ms Stern's evidence that, at a meeting with Ms Simonetti and Ms Argyrou on 18 February 2009, Ms Simonetti and Ms Argyrou encouraged her to try to sell more products to clients. Ms Simonetti's and Ms Argyrou's evidence is that they encouraged all staff in this way, to try to improve the performance of the business. I accept this evidence. I am not prepared to accept Ms Stern's evidence that, at that meeting, there was discussion about who might be made redundant. This is denied by Ms Simonetti and Ms Argyrou, and there is simply insufficient evidence to make a finding one way or the other.
On 11 March 2009, just after Ms Stern came to work, Ms Argyrou had a private meeting with her and told her that she had been made redundant. She was given a letter and a cheque. The cheque is not in evidence but, from the payroll records which are in evidence, I have been able to determine its amount. I deal with this shortly.
Ms Stern's version and Ms Argyrou's version of what was said at that meeting are different. Ms Stern's evidence is that Ms Argyrou had told her that it was hard that she was a part timer and it was hard to rearrange her shifts to cover busy times during the day, and her hours 'didn't work', and that other employees could cover busy hours. Ms Argyrou's version of this conversation is that she told Ms Stern she was redundant, that Ms Argyrou was sorry, and that it was unfortunate. On this point, I prefer Ms Argyrou's evidence as the more convincing.
Both Ms Stern and Ms Argyrou agree that Ms Argyrou then hugged her and said that she should call after the birth of her baby and see if they could 'bring her back on'.
While I accept that the hug (following so closely on the redundancy and given by the person who had just made Ms Stern redundant) may have been ill-timed and inappropriate, I do not accept that (objectively) it was an attempt to humiliate Ms Stern or intended to humiliate her.

I accept Ms Stern's evidence that she felt extremely upset by the redundancy. She was sleepless and dejected. There is no medical evidence before me on this point, however.
Ms Stern's baby was born five weeks prematurely on 20 May 2009. The medical certificate in relation to the birth (which is in evidence) states that there had been a premature rupture of membranes and that the birth was induced. While Ms Stern's evidence was that she believed that the premature birth of her child was due to the stress she had suffered from her treatment by the company, I do not accept this. There was no medical evidence to justify such a finding.

Did the company directly discriminate against Ms Stern on the ground of her pregnancy in breach of s14 of the EO Act.?

Apart from one matter, I am not satisfied that the company or its agents (Ms Simonetti and Ms Argyrou) breached s14 of the EO Act during Ms Stern's employment. Except for this one matter, they did not, during Ms Stern's employment, directly discriminate against her on the ground of her pregnancy. They did not, during her employment, on the ground of her pregnancy, subject her to a detriment, by humiliation or otherwise. I am not satisfied that the way in which Ms Argyrou and Ms Simonetti treated Ms Stern's request for a reduction of hours due to her pregnancy constituted less favourable treatment of her on the basis of that pregnancy. The various requests by her and responses by Ms Simonetti and Ms Argyrou were really part of a course of negotiation about how best to deal with the request for reduction of hours in the context of the company's business. These negotiations included suggestions and counter-suggestions. Eventually, once there was clear medical evidence, her hours were reduced. Nor am I satisfied that there was appreciable delay in reducing her hours once the medical evidence had been produced.
The one exception to this finding is the way in which Ms Simonetti and Ms Argyrou (as agents for the company) unilaterally changed Ms Stern's employment from full time to permanent part time, rather than treating her (in accordance with her request) as a permanent employee wanting a temporary reduction in her hours without a change in her employment status. I have found that the company treated other employees who, on grounds other than pregnancy, requested a change in their hours better than it treated Ms Stern. It agreed to the requests, although not immediately. It did not require the requests to be put into writing. It did not treat the requests as a change in employment status. I am satisfied that, when considering Ms Stern's request, the fact that the request was made on the ground of pregnancy was an actuating factor in the minds of Ms Simonetti and Ms Argyrou. It was a substantial part of the decision-making process. Whether or not there were other reasons for the decision, it was a substantial reason for the decision to change Ms Stern's employment status.

Did the company directly discriminate against Ms Stern on the ground of her pregnancy when it made her redundant?

I am satisfied that it did. Although I am satisfied that the dominant reason for the decision was business-related, a substantial factor (a factor of substance) which actuated the minds of Ms Simonetti and Ms Argyrou when they chose Ms Stern for redundancy was that she was a part time employee working reduced hours. The only reason that she was a part time employee was because Ms Simonetti and Ms Argyrou had changed her employment status from full time to permanent part time, and the only reason she was working reduced hours was because Ms Simonetti and Ms Argyrou had granted her request to work reduced hours because of pregnancy. Pregnancy was therefore a substantial reason, an actuating factor in the making of the decision to choose her for redundancy. Ms Argyrou and Ms Simonetti (and therefore their principal, the company) treated her less favourably than their other employees who were not pregnant. None of these were made redundant.

Ms Stern seeks compensation. Section 136 of the EO Act permits the tribunal to award compensation for loss, damage or injury suffered by a complainant in consequence of a contravention of the EO Act.
The change in Ms Stern's employment status meant that she could not, as she could have done if she were a full time employee, require her full time hours to be reinstated. This is a serious erosion of Ms Stern's employment position. I consider it an appropriate award of compensation for her loss under this head to be $3000.
It is not clear from the evidence that Ms Stern would have returned to work with the company after the birth of her child. Taking this into account, I award her in respect of the loss suffered because of the redundancy ten weeks' wages. This is the period from the date of the redundancy (11 March 2009) to the date of the birth of her child (20 May 2009). The award is based on a 21 hour week at $20 per hour. It excludes her 'breaks'. This gives a total figure of $4200. From this I deduct payments (from the payroll records of the company) made to her in March and April, presumably in relation to one week's leave she took in March, and some payment in lieu of notice in respect of the redundancy. The total of this is $1812.42. From $1812.42, I subtract the amount paid for one week's leave (which I am satisfied was $420), which leaves a total of $1392.42. When one subtracts this sum from the $4200, the result is $2807.58.
Ms Stern has not asked for interest on this amount.
As to emotional distress caused to Ms Stern by the redundancy, I consider that, although there is no medical evidence, Ms Stern's evidence of her distress is credible and her distress was real. An appropriate, realistic and commonsense award for this is $800. The total compensation is therefore $6607.58.

[1] Leonard v Youth Hostels Association (1995) EOC 92-763

[4] See Hall v Sheiban & ors. [1989] FCA 72; (1989) EOC 92-250

[5] Department of Health v**.** Arumugam [1988] VicRp 42; [1988] VR 319

Opportunity Act 1995

Stern v Depilation & Skincare Pty Ltd

At a glance

Court

Decision date

Source

Judgment (23 paragraphs)

Stern v Depilation & Skincare Pty Ltd (Anti-Discrimination) [2009] VCAT 2725 (22 December 2009)

Parties

Legislation Cited (1)