s.394 - Unfair dismissal

Application for an unfair dismissal remedy - jurisdictional objections - whether Respondent a small business employer - whether Respondent has associated entities - whether dismissal a case of genuine redundancy - Small Business Fair Dismissal Code does not apply - dismissal not a case of genuine redundancy - no evidence as to reason for dismissal - lack of procedural fairness - Applicant unfairly dismissed - reinstatement inappropriate - compensation awarded.

• [1] On 17 April 2025, Mr Steven Cartarrasa made an application to the Fair Work Commission (the Commission) under s.394 of the Fair Work Act 2009 (the Act) alleging that he had been dismissed from his employment with Smart Tech Retail Group Pty Ltd (the Respondent) and that the dismissal was harsh, unjust or unreasonable. The Respondent trades under the business name of Aussie Batteries and Solar (ABS).

• [2] It is convenient to summarise the procedural background to this matter. The matter was allocated to me on 5 June 2025. The following day, I issued correspondence informing the parties that the matter would be listed for a telephone conference before me on 17 June 2025. In that correspondence, I directed the Respondent to file a Form F3 Employer Response to the application and provide evidence as to its corporate structure and any associated entities by 11 June 2025.

• [3] On 11 June 2025, my chambers received an email from Ms Krystal Crombie, who was described as the General Manager of ABS, informing the Commission that correspondence in relation to the matter should be addressed to Mr Nathan Gathercole, Director of the Respondent. The Respondent did not file a Form F3 as directed.

• [4] The telephone conference proceeded before me on 17 June 2025 with Mr Cartarrasa and Mr Gathercole in attendance. During the conference, I reminded Mr Gathercole of the direction requiring the Respondent to file a Form F3 and afforded the Respondent an extra period until 18 June 2025 to do so. I explained to Mr Gathercole that, in determining the number of employees of the Respondent, employees of any associated entities of the Respondent are included.[1] Mr Gathercole stated during the conference that Ms Ella MacGregor, his sister was the Director of the Respondent. Following the conference, Mr Gathercole requested an extension until 19 June 2025 to file the Form F3, which was granted and with which the Respondent complied.

• [5] In the Form F3, the Respondent raised jurisdictional objections to the application on the basis that the dismissal was a case of genuine redundancy, and that the Respondent was a small business employer at the time of the dismissal and complied with the Small Business Fair Dismissal Code. The Form F3 stated that the Respondent had eight employees at the time of the dismissal; the names of these employees were provided. The Respondent did not provide evidence of its corporate structure and details of any associated entities.

• [6] On 20 June 2025, I issued directions requiring both parties to file evidence and submissions in respect of the two jurisdictional objections raised by the Respondent and the merits of the application in preparation for a hearing on 20 August 2025. The directions required the Respondent to demonstrate whether it was a small business employer, having regard to ss.50AAA and 50AA of the Corporations Act 2001 (Corporations Act). Mr Gathercole and Ms MacGregor were each directed to file a witness statement detailing their involvement in any corporate entities. The directions required the Respondent to file its material by 11 July 2025.

• [7] The Respondent did not file any material in accordance with the directions. On 14 July 2025, I wrote to the parties, seeking an explanation from the Respondent as to its failure to comply with the directions. No response was received. Accordingly, on 15 July 2025, I issued Orders requiring the attendance of Mr Gathercole and Ms MacGregor at the hearing on 20 August 2025. A short time later, Mr Gathercole sent the following email, referring to the Form F3 filed on 19 June 2025:

"It is the companies [sic] position that the previous email covered all points of reply, regarding lyre [sic] commissioners [sic] directions, specifically, small Business and redundancy.

no further information is Outstanding or to be provided."

• [8] In response, my chambers sent the following correspondence to the parties:

The Directions require the Respondent to file material in support of its jurisdictional objections and the merits of the application. The material filed by the Respondent to date is insufficient to substantiate its position on these matters.

The Commissioner would expect, at a minimum, a witness statement from Mr Gathercole, outlining his involvement with his various corporate entities for the purpose of determining whether there are associated entities of the Respondent and whether the Respondent is a small business employer. The witness statement would further detail Mr Gathercole's involvement in the Applicant's dismissal for the purpose of determining whether the dismissal was a case of genuine redundancy, and if necessary, whether the dismissal was harsh, unjust or unreasonable.

In the event Mr Gathercole does not provide a detailed witness statement, he will be giving extensive oral evidence at the hearing commencing at 4:00pm (AEST) on 20 August 2025, answering questions of the Commissioner and any questions in cross-examination. Mr Gathercole has now been ordered to attend the hearing, together with Ms MacGregor."

• [9] No further response was received from Mr Gathercole or the Respondent.

• [10] On 28 July 2025, a Form F53 - Notice of Legal Representation was filed by Legal Aid Queensland on behalf of Mr Cartarrasa. Mr Cartarrasa then filed his material in accordance with the directions on 1 August 2025.

• [11] The hearing proceeded on 20 August 2025 in person. I granted permission for Mr Richard Diqer of Counsel, instructed by Ms Jessica Wray of Legal Aid Queensland to represent Mr Cartarrasa. Despite my Orders issued on 15 July 2025, Mr Gathercole and Ms MacGregor did not attend the hearing. Numerous attempts were made by my Associate to contact the Respondent for the hearing, without success. The hearing proceeded in the absence of the Respondent in accordance with s.600 of the Act.

• [12] Given the failure of Mr Gathercole and Ms MacGregor to attend the hearing as ordered, I intend to provide a copy of this decision to the Australian Federal Police for consideration of prosecution.[2]

• [13] Sections 394 and 385 of the Act relevantly provide as follows:

(1) A person who has been dismissed may apply to the FWC for an order under Division 4 granting a remedy.

Note 1: Division 4 sets out when the FWC may order a remedy for unfair dismissal.

Note 3: Part 6 1 may prevent an application being made under this Part in relation to a dismissal if an application or complaint has been made in relation to the dismissal other than under this Part.

(a) within 21 days after the dismissal took effect; or

(b) within such further period as the FWC allows under subsection (3).

A person has been unfairly dismissed if the FWC is satisfied that:

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388."

• [14] Section 388(2) of the act states that a dismissal will be compliant with the Code if, at the time of the dismissal, the employer was a small business employer and the employer complied with the Code in relation to the dismissal. Section 23 of the Act provides the definition of a small business employer:

(1) A national system employer is a small business employer at a particular time if the employer employs fewer than 15 employees at that time.

(2) For the purpose of calculating the number of employees employed by the employer at a particular time:

(a) subject to paragraph (b), all employees employed by the employer at that time are to be counted; and

(b) a casual employee is not to be counted unless, at that time, the employee is a regular casual employee of the employer.

(3) For the purpose of calculating the number of employees employed by the employer at a particular time, associated entities are taken to be one entity.

(4) To avoid doubt, in determining whether a national system employer is a small business employer at a particular time in relation to the dismissal of an employee, or termination of an employee's employment, the employees that are to be counted include (subject to paragraph (2)(b)):

(a) the employee who is being dismissed or whose employment is being terminated;

(b) any other employee of the employer who is also being dismissed or whose employment is also being terminated."

• [15] 'Associated entity' is defined in s.12 of the Act as having the meaning given by s.50AAA of the Corporations Act. That section relevantly provides:

(1) One entity (the associate) is an associated entity of another entity (the principal) if subsection (2), (3), (4), (5), (6) or (7) is satisfied.

(a) an entity (the third entity) controls both the principal and the associate; and

(b) the operations, resources or affairs of the principal and the associate are both material to the third entity."

• [16] The meaning of 'control' is outlined in s.50AA of the Corporations Act, which relevantly provides:

(1) For the purposes of this Act, an entity controls a second entity if the first entity has the capacity to determine the outcome of decisions about the second entity's financial and operating policies.

(2) In determining whether the first entity has this capacity:

(a) the practical influence the first entity can exert (rather than the rights it can enforce) is the issue to be considered; and

(b) any practice or pattern of behaviour affecting the second entity's financial or operating policies is to be taken into account (even if it involves a breach of an agreement or a breach of trust)."

• [17] Section 389 of the Act describes when a dismissal is a case of genuine redundancy:

(1) A person's dismissal was a case of genuine redundancy if:

(a) the person's employer no longer required the person's job to be performed by anyone because of changes in the operational requirements of the employer's enterprise; and

(b) the employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy.

(2) A person's dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within:

(b) the enterprise of an associated entity of the employer."

• [18] Section 387 of the Act provides the criteria the Commission must consider when determining whether a dismissal was harsh, unjust or unreasonable:

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person's capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person - whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant."

• [19] Section 396 of the Act provides that the Commission must consider whether the dismissal was consistent with the Small Business Fair Dismissal Code (the Code) and whether the dismissal was a case of genuine redundancy before considering the merits of the application. These are the two jurisdictional issues before the Commission. The application was made in time. Mr Cartarrasa has been dismissed and has met the minimum employment requirements.

• [20] Mr Cartarrasa filed a witness statement in these proceedings and gave oral evidence at the hearing.

• [21] Mr Cartarrasa first commenced employment with an entity owned by Mr Gathercole in May 2017 as a full-time Salesperson. From this time, he was employed by a number of various entities owned and operated by Mr Gathercole. They included Sunshine Coast Labour Hire Pty Ltd, BTNM Trading Pty Ltd and Smart Lithium Batteries Pty Ltd. From May 2017 until around August 2019, Mr Cartarrasa stated that he worked for ABS in the employ of The Trustee for The N & M Gathercole Family Trust.

• [22] In August 2019, Mr Cartarrasa returned to Italy for family matters. He obtained permission from Mr Gathercole to work remotely from Italy, which he did until around mid-2020. His evidence is that he did not work for any of Mr Gathercole's entities between 30 June 2020 and November 2022 which he considered was unpaid leave. I do not accept that evidence and consider that Mr Cartarrasa did not have employment again with any entity owned and operated by Mr Gathercole until September 2023.

• [23] In September 2023, while still living in Italy, Mr Cartarrasa negotiated to work in the business remotely and then returned to Australia in November 2023 to work from the Respondent's showroom on the Sunshine Coast.

• [24] From mid-November 2023, Mr Cartarrasa was earning $90,000 per annum and permitted to work from home. He stated that he was paid wages either in cash or by electronic bank transfer until December 2023.

• [25] On 25 January 2024, he signed a new employment agreement with the Respondent with a salary of $90,000 per annum, exclusive of superannuation. On 5 June 2024, Mr Cartarrasa sought an increase to his salary to $120,000 exclusive of superannuation. Mr Gathercole invited him to coffee. At their meeting on 30 July 2024, Mr Cartarrasa noted that the Respondent had issues with its cash flow. Mr Cartarrasa offered to reduce his ordinary hours and remuneration to 78.9% pro-rata to assist the Respondent. He stated that he reached a verbal agreement with Mr Gathercole, with the arrangement to be revisited in three months.

• [26] In August 2024, Mr Cartarrasa returned to Italy, authorised to work remotely.

• [27] On 29 August 2024, Mr Cartarrasa sent an email to Mr Gathercole in relation to the pro-rata remuneration arrangement. The email is lengthy and detailed, reflecting an arrangement for work to be performed 30 hours per week at a pro rata calculation of 78.9%.

• [28] In late November 2024 there was some discussion as to whether Mr Cartarrasa's hours would reduce to four hours per day at a pro rata rate of 60%.

• [29] On 19 March 2025, Mr Gathercole sent the following text message to Mr Cartarrasa:

"Honestly I wish you where [sic] hear [sic] in oz to help with modular sales. Really need some extra help! :)"

• [30] On 1 April 2025, Mr Cartarrasa stated that he attempted to log on to the Respondent's software systems and noticed that he could not access the systems. He contacted Ms Krystal Crombie, General Manager and asked her to escalate the issue to the Respondent's IT specialist. Ms Crombie said that she would need to speak to Mr Gathercole. Mr Cartarrasa then contacted Mr Gathercole who told him that they would speak over videoconference the following day.

• [31] The following day, Mr Cartarrasa sent an email to Mr Gathercole in relation to leave requests from 31 March 2025 to 11 April 2025. The email is as follows:

was due to resume from two days' annual leave today at 8:30 AEST. I will be on personal leave for the remainder of this week and all next week to Friday April 11th.

The past Monday Mar 31st and Tuesday Apr 1st were regularly requested as annual leave two weeks ago for a personal commitment and confirmed in the diary.

Two personal days were requested last week (Thu and Fri) after a workplace issue arose that affected my mental health.

It was arranged with Nathan to be discussed this morning.

As he requested yesterday, he was messaged at 6am AEST and I waited for contact to be made until 10:30 AEST.

These coming days are not to be deducted from annual leave, please.

They have been accrued since contract resumption, accounting for the pro-rata special arrangement I spontaneously volunteered to reduce to from my permanent full time role contracted hours to assist the business with cash flow concerns last November.

Appreciate further communication kindly be by email."

• [32] Mr Gathercole then sent the following email to Mr Cartarrasa a short time later:

"Hi Steve your position has been made redundant and your services is [sic] no longer required offering you standard one weeks notice starting today. We wish you best of luck with all future endeavours."

• [33] Mr Cartarrasa stated that prior to receiving this email, he had not received a call from Mr Gathercole nor any written or verbal warning from the Respondent in relation to the redundancy, or issues with his performance. Mr Cartarrasa did not return to work after receiving the email as he considered his dismissal was immediate. Since being dismissed, Mr Cartarrasa has not received any further payment of wages, and has not been paid for work undertaken from 24-28 April 2025 and annual leave taken on 31 March and 1 April 2025. He has not received any redundancy payment.

• [34] On 3 April 2025, Mr Cartarrasa sent an email to Mr Gathercole outlining what he considered were his outstanding entitlements. The same day, he received the following response from Mr Gathercole:

Please stop communication with staff as you no longer work for the company and this will cube [sic] classed as harraent [sic] harassment and dealt with accordingly.

If you wish to pursue your employment case with fair work, please do.

• [35] Mr Cartarrasa stated that he felt devastated following this email, and in the ensuing months experienced heightened levels of depression, anxiety and insomnia. He stated that the dismissal has had a significant psychological impact, as he lost his ability to earn an income and no longer had a sponsoring employer for his visa application to live in the United States.

• [36] Mr Cartarrasa made a WorkCover claim for psychological injuries sustained as a result of his dismissal. The claim was initially rejected as WorkCover required that the medical certificate provided in support of the claim be certified by a doctor registered in Australia. Mr Cartarrasa later received confirmation on 19 May 2025 that his WorkCover claim had been accepted.

• [37] On 12 May 2025, Mr Cartarrasa sent an email to the Respondent requesting a separation certificate. He received a response from Ms Crombie the same day informing him that she would provide a further update, however he received no further response.

• [38] When the Respondent finally filed the Form F3, the following was stated by Mr Gathercole:

"It should also be noted that I wanted to Fire steven for serious misconduct. Due to providing internal sales documents to a past employee on numerous occasions.

It was ella's position that he be made redundant due an ongoing issue of sales. Stevens

decision to move overseas meant that he was not able to service clients in our showroom.

Sales had drasitically [sic] dropped and his position was not sustainable on phone sales."

• [39] Upon receiving the Respondent's Form F3 response, Mr Cartarrasa was surprised that the Respondent indicated that it was a small business employer. He stated that is not correct, and Mr Gathercole was involved in the financial and operational decision-making of ABS. Mr Cartarrasa said that he understood that Mr Gathercole has previously been a director of ABS and the sole director of previous holding companies of ABS. Mr Cartarrasa had to seek the approval of Mr Gathercole for every sales-related decision. He therefore believed Mr Gathercole had a level of control and decision-making authority within ABS. Mr Cartarrasa stated that he does not recall having any dealings with Ms MacGregor at any time during his employment with the Respondent.

• [40] Mr Cartarrasa stated that he was not notified of, nor given any opportunity to respond to, serious misconduct or performance-related concerns alleged by the Respondent. From Mr Gathercole's dismissal email sent on 2 April 2025, Mr Cartarrasa understood that his dismissal was because his position had been made redundant. At no time was he consulted about the possibility of being made redundant.

• [41] Mr Cartarrasa noted in the Form F3 that there were eight individuals named as employees. His evidence is that these eight employees do not accurately reflect all of the employees who he understood to be working for ABS at the time of his dismissal. Mr Cartarrasa stated that he has previously seen payroll records which usually provide details of the positions and pay of employees.

• [42] Mr Cartarrasa recalled that Mr Gathercole employed individuals in other companies he directed, such as Gathercole Group Pty Ltd (Gathercole Group) and Dream Modular Homes Pty Ltd (Dream Modular Homes). Mr Cartarrasa said that some of these employees were also employed by ABS. For example, Mr Bhavik Patel's email address was linked to the Gathercole Group and he also processed payroll for ABS. While he stated that it was not clear what the relationship between ABS and Mr Gathercole's other companies was, in his view, there was some sort of connection.

• [43] Mr Cartarrasa recalled that it was common for employees of ABS to be transferred to Dream Modular Homes. Dream Modular Homes operated at the same head office of ABS in Chevallum, Queensland. He had received the earlier text message from Mr Gathercole regarding wishing he could assist him with Dream Modular Homes work.

• [44] At the time of his dismissal, Mr Cartarrasa stated that the following people were employed by ABS:

1. Ashia Hampson Wilkie (sales and admin);
2. Dana Landgren (cannot recall role);
3. Jackson Mayfield (warehouse and dispatch);
4. Jeremy Spencer (Salesperson);
5. Krystal Crombie (General Manager);
6. Michael Potts (Manufacturing Manager);
7. Sian East (sales and admin);
8. Cam (cannot recall last name, Chief Technology Officer);
9. Mr Gathercole (General Manager);
10. Kate Vaney (Owner of Giant Power);
11. Daz (unaware of full name, delivery driver);
12. Sun Akquila (Solar Energy Engineer);
13. Nathan Craze (Warehouse Manager);
14. Jaclyn Marquis (HR and legal);
15. Bhavik Patel (payroll); and
    1. Ronnie Conquest (logistics).

• [45] Mr Cartarrasa stated that at the time of his dismissal, some employees who had previously worked for ABS were working for Dream Modular Homes.

• [46] At the time of filing his witness statement, Mr Gathercole said that he had not received any further payments of wages or redundancy pay from the Respondent. With an annual salary of $90,000, his weekly wage was $1,730.77. He has been receiving income payments from WorkCover from around 19 May 2025. He initially received a weekly gross payment of $1,014.59 until 6 June 2025. From that date, the gross payment increased to $1,161.44 per week. Mr Cartarrasa was back paid to 23 April 2025. Mr Cartarrasa is still receiving this weekly payment from WorkCover, with his net pay totalling $966.44 per week.

• [47] Per his most recent Work Capacity Certificate dated 8 July 2025, Mr Cartarrasa has been certified not to have functional capacity for any type of work until 8 October 2025. Mr Cartarrasa has not applied for other jobs as he does not believe he has capacity due to his psychological condition. He stated that it is his hope to return to work as soon as he is able, and it is intention to apply for jobs at that time.

• [48] Through a witness statement of Ms Jessica Wray, Solicitor of Legal Aid Queensland, Mr Cartarrasa provided ASIC and Australian Business Register (ABR) extracts of a number of entities associated with Mr Gathercole.

• [49] The Respondent is an Australian Private Company trading under the business name of Aussie Batteries and Solar since 18 August 2023.

• [50] An ABR search of 'The trustee for the N & M Gathercole Family Trust' was also undertaken. This entity's ABN has been cancelled since 26 March 2021.

• [51] An ASIC search of 'Gathercole Group Pty Ltd' was undertaken. This entity was registered on 27 April 2017 and has the same principal place of business address as the Respondent in Chevallum, Queensland. The search shows that Mr Gathercole is the sole director of this entity.

• [52] An ASIC search of the Respondent indicates that it was registered on 14 May 2020, and Ms MacGregor is the current director.

• [53] An ASIC business name extract for ABS demonstrates that the Respondent is the business name holder.

• [54] An ASIC business name search was also undertaken in respect of Mr Gathercole. This search shows that he is the holder of two business names: 'Aussie Batteries' and 'Paladin Australia'.

• [55] Mr Cartarrasa submitted that the Respondent was not a small business employer at the time of his dismissal because it employed 15 or more employees. He argued that the evidence provided by the Respondent is insufficient to establish it employed fewer than 15 employees. He also noted that the Respondent's evidence regarding the number of employees is inconsistent with his own evidence. In the absence of clear evidence from the Respondent as to the total number of employees of the Respondent and any associated entities, Mr Cartarrasa submitted that his evidence should be preferred.

• [56] In the event the Commission determines that the Respondent did not have at least 15 employees at the time of the dismissal, Mr Cartarrasa submitted that there were associated entities of the Respondent:

a) that would result in the total number of employees being 15 or more; or

b) to which Mr Cartarrasa could have been redeployed.

• [57] Mr Cartarrasa submitted that the numerous entities for whom he performed work from 2017 until his dismissal are all associated entities of the Respondent, by virtue of Mr Gathercole's involvement with the management of each of them, and the control he exerted over them. Specifically, Mr Cartarrasa highlighted the practical influence Mr Gathercole exerted over the Respondent and its business, and Mr Gathercole's practices and pattern of behaviour, affecting the Respondent's financial or operating policies.

• [58] Mr Cartarrasa conceded that Ms MacGregor is currently listed as the Director of the Respondent but argued that the level of control exerted by Mr Gathercole over all of the relevant entities is sufficient to demonstrate that the Respondent was not a small business employer. Mr Cartarrasa submitted that the fact that he only ever received and signed two employment contracts with the relevant entities supports the argument that the entities were associated with the Respondent.

• [59] In the alternative, if the Commission determines that the Respondent is a small business employer, Mr Cartarrasa submitted that the Respondent did not comply with the Code.

• [60] The Respondent bears the evidentiary burden of proving compliance with the Code, including by providing evidence of warnings, completed checklists, statements of termination or signed witness statements. Mr Cartarrasa submitted that where the Code includes considerations relevant to the genuineness of a redundancy and where this is relied on by an employer, the employer is required by the Code to provide evidence in support of each of the elements of s.389 of the Act. Mr Cartarrasa submitted that the Respondent's evidence is insufficient in this regard.

• [61] Mr Cartarrasa submitted that the Respondent has not provided sufficient evidence to demonstrate that his job was no longer required because of changes in the operations requirements of the business and has therefore not satisfied its obligations under the Code in this respect. Further, he argued that there is insufficient evidence to show that the Respondent complied with the requirement to consider reasonable redeployment.

• [62] Mr Cartarrasa relied on his submissions in respect of the Code as it relates to genuine redundancies in respect of the separate jurisdictional question of whether the dismissal was a case of genuine redundancy. Mr Cartarrasa again submitted that the Respondent has not discharged its evidentiary burden in this regard.

• [63] Should the Commission determine that the Code does not apply, or that the Respondent did not comply with the Code, and that the dismissal was not a case of genuine redundancy, Mr Cartarrasa submitted that his dismissal was harsh, unjust or unreasonable under s.387 of the Act.

• [64] Based on the lack of evidence before the Commission demonstrating genuine operational change within the Respondent's business, Mr Cartarrasa submitted that there cannot have been a valid reason for dismissal. Mr Cartarrasa noted that while the Respondent initially dismissed him on the grounds of redundancy, its response to the application and supporting material asserted that serious misconduct and performance issues were relevant reasons for the dismissal. Mr Cartarrasa submitted that any such reasons were not raised with him during his employment, lack credibility and should not be accepted by the Commission as legitimate.

• [65] Mr Cartarrasa submitted that if the Commission finds that there was a valid reason for the dismissal, he was not notified of the reason. He argued that he was not notified that his position would be made redundant or made aware of any operational change within the Respondent's business. He also submitted that the allegations of unsatisfactory performance and serious misconduct were not sufficiently particularised or communicated to him prior to the dismissal.

• [66] If the Commission determines that the allegations made against him were sufficient in detail for him to respond, Mr Cartarrasa submitted that he was not provided with an opportunity to provide any response.

• [67] Mr Cartarrasa noted that there was no offer prior to the dismissal to be accompanied by a support person.

• [68] Mr Cartarrasa submitted that he was not warned about any unsatisfactory performance before the dismissal.

• [69] Mr Cartarrasa submitted that it is clear the Respondent engages a human resource specialist within its enterprise. He argued that there is a clear management structure within the enterprise which should have facilitated an appropriate investigation or show cause process in relation to the dismissal.

• [70] Mr Cartarrasa submitted that he does not hold any specific qualifications in relation to the field of work he completed with the Respondent and is unable to return to work due to his psychological state as a consequence of the dismissal.

• [71] Mr Cartarrasa submitted that his dismissal was harsh, unjust and unreasonable having regard to s.387 of the Act, and he was therefore unfairly dismissed and is entitled to a remedy under ss.390-392 of the Act.

• [72] Due to the breakdown of trust and confidence between himself and the Respondent, Mr Cartarrasa submitted that it would not be appropriate for him to be reinstated. Therefore, he submitted that the Commission should exercise its discretion to make an order of compensation for lost income.

• [73] Mr Cartarrasa noted that the period between his dismissal on 2 April 2025 and the date of the hearing before the Commission is a total of 4 months and 18 days, or approximately 20 weeks. Prior to his dismissal, Mr Cartarrasa was earning a gross weekly wage of $1,730.77, with his net pay totalling $1,316.77. At the hearing it was conceded that the gross weekly wage was only $1,366.40 on account of only 30 hours per week being worked.

• [74] It was submitted that this sum is $27,328. Mr Cartarrasa has received $14,640.02 in workers' compensation payments. He seeks an order of compensation representing the difference, being $12,687.98.

• [75] Mr Cartarrasa conceded that he was employed with the Respondent for a period of a little more than a year, which ordinarily may not be considered a lengthy time for the purposes of s.392(2)(b) of the Act. However, he submitted that authorities suggest that this factor should not necessarily incline the Commission to make a reduction to any compensation order.[3]

• [76] Mr Cartarrasa acknowledged that he has not mitigated his loss by applying for alternative employment, but submitted that this should be accounted for by the attempts he had made to resolve the issue with the Respondent, and by his reduced functional capacity to return to work due to his psychological state. He submitted that there is no reasonable expectation that he will obtain remuneration other than workers' compensation payments in the period between the making of any compensation order and receipt of the actual compensation.

• [77] Alongside its Form F3 Response to the application, the Respondent submitted a list of nine employees it said were employed from 1 March 2025 to 30 April 2025. These employees are:

1. Ashia Hampson Wilkie;
2. Dana Landgren;
3. Jackson Mayfield;
4. Jeremy Spencer;
5. Krystal Crombie;
6. Mandy Roberts;
7. Michael Potts (Manufacturing Manager);
8. Sian East (sales and admin);

• [78] All of these employees, other than Mandy Roberts, appear on the list of employees provided in Mr Cartarrasa's statement to the Commission.

• [79] Mr Gathercole stated that Mr Cartarrasa was hired by ABS when he had no involvement or managerial role in the business, and that Mr Cartarrasa was hired by Ms Kate Vaney, who was the manager at the time. Mr Gathercole stated that he had no knowledge of Mr Cartarrasa's hiring for three months, at which time Ms MacGregor asked him to assist due to the declining financials of the business. Mr Gathercole stated he offered to assist and replaced Ms Vaney as interim manager. He stated that all financial decisions of the business were, and still are, Ms MacGregor's.

• [80] In his statement, Mr Gathercole said that "we decided to offer [Ms Crombie] (an existing employe[e]) the role of manager", which allowed Mr Gathercole "to focus on [his] business interest". From this time, Mr Gathercole stated that he only attended a weekly management meeting with Ms Crombie and Mr Cartarrasa. Notes and information from these meetings were then provided to Ms MacGregor.

• [81] Mr Gathercole stated that Ms Crombie managed Mr Cartarrasa on a day-to-day basis. Mr Gathercole only assisted "when there was need or larger decisions [were] required". He stated that Ms MacGregor dealt with Ms Crombie in relation to sales data. Mr Gathercole was copied into emails in this regard.

• [82] Mr Gathercole stated that the reason he managed Mr Cartarrasa was because of their relationship when Mr Gathercole owned the business prior to 2020. He said he also helped with the management of Mr Cartarrasa due to Mr Cartarrasa's "volatile nature" towards Ms Crombie.

• [83] Mr Gathercole stated that he has no financial interest or investment in the Respondent and has no financial decision making.

• [84] Mr Gathercole said that he "wanted to fire" Mr Cartarrasa for serious misconduct, on account of Mr Cartarrasa providing internal sales documents to a past employee on numerous occasions. Mr Gathercole provided copies of two emails sent by Mr Cartarrasa in relation to certain sales which are blind carbon copied to a number of external email addresses. In evidence given during the hearing, Mr Cartarrasa stated that they were, in fact, email addresses of current employees.

• [85] Mr Gathercole stated that it was Ms MacGregor's position that Mr Cartarrasa be made redundant due to ongoing sales issues. Mr Cartarrasa's decision to move overseas meant that he was not able to service clients in the Respondent's showroom. Mr Gathercole stated that sales had "drastically dropped", and Mr Cartarrasa's position was not sustainable if he were only to perform phone sales.

Is the Respondent a small business employer and if so, was the Small Business Fair Dismissal Code complied with?

• [86] In addition to the ASIC and ABR searches provided by Mr Cartarrasa, the Commission has undertaken an ASIC search of 'Dream Modular Homes Pty Ltd', which was identified by Mr Cartarrasa as another of Mr Gathercole's corporate entities. The search revealed that this entity was registered on 11 October 2022 and has the same principal place of business address as Mr Gathercole's other entities in Chevallum, Queensland. The sole director of Dream Modular Homes is Mr Gathercole.

• [87] Relevant to s.50AAA(7) of the Corporations Act, it must be determined if Mr Gathercole, as the 'third entity', controls the Respondent and other entities he is associated with. Having regard to the test of 'control' in s.50AA of the Corporations Act, I determine the following:

(a) Mr Gathercole has the capacity to determine the outcome of decisions about the Respondent's and at least Dream Modular Homes' financial and operating policies;

(b) the practical influence Mr Gathercole can exert, rather than the rights he can enforce has been considered; and

(c) the practices or pattern of behaviour affecting the Respondent's financial or operating policies has been taken into account.

• [88] I have had regard to the control that Mr Gathercole can exert over the way in which the Respondent operates. I have taken into account and accepted Mr Cartarrasa's evidence about the control Mr Gathercole had over the way he performed his work, and the absence of instructions from Ms MacGregor. I have also had regard to the fact that the dismissal was initiated by Mr Gathercole.

• [89] I am satisfied that on 2 April 2025 the Respondent and Dream Modular Homes were associated entities within the meaning of s.50AAA of the Corporations Act. There were at least 15 employees employed across the two entities on 2 April 2025 and therefore the Respondent was not, at that time, a small business employer within the meaning of s.23 of the Act.

• [90] Mr Cartarrasa conceded that he was not employed pursuant to an award or enterprise agreement requiring consultation in respect of any proposed redundancy.

• [91] Mr Gathercole's unsworn evidence to the Commission is that it was Ms MacGregor's position that Mr Cartarrasa be made redundant. Mr Gathercole's evidence is neither direct, sworn or tested due to his failure to attend the hearing, despite being ordered to attend. His evidence is not accepted and therefore the Commission is unable to be satisfied that, pursuant to s.389(1)(a) of the Act, the Respondent no longer required Mr Cartarrasa's job to be performed by anyone because of changes in the operational requirements of the Respondent's enterprise.

• [92] The jurisdictional objection that the dismissal was a case of genuine redundancy requires two affirmative elements and one negative element which must be satisfied to establish whether a dismissal was or was not a case of genuine redundancy.

• [93] I have determined that the first affirmative element was not satisfied in this case. Specifically, the Respondent has not satisfied the Commission in respect of s.389(1)(a) of the Act. It is unnecessary to consider the redeployment element.

• [94] Accordingly, the dismissal did not satisfy the meaning of genuine redundancy within the Act.

• [95] A dismissal may be unfair, when examining if it is 'harsh, unjust or unreasonable' by having regard to the following reasoning of McHugh and Gummow JJ in Byrne v Australian Airlines Ltd:[4]

"It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer act, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted."

• [96] I am duty-bound to consider each of the criteria set out in s.387 of the Act in determining this matter.[5]

s.387(a) - whether there was a valid reason for the dismissal related to the person's capacity or conduct (including its effect on the safety and welfare of other employees)

• [97] When considering whether there is a valid reason for termination, the decision of North J in Selvachandran v Peterson Plastics Pty Ltd [1995] IRCA 333; (1995) 62 IR 371 at 373 provides guidance as to what the Commission must consider:

"In its context in s.170DE(1), the adjective 'valid' should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s.170DE(1) At the same time the reasons must be valid in the context of the employee's capacity or conduct or based on upon the operational requirements of the employer's business. Further, in consideration whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must 'be applied in a practical, common-sense way to ensure that the employer and employee are treated fairly'."

• [98] However, the Commission will not stand in the shoes of the employer and determine what the Commission would do if it was in the position of the employer.[6]

• [99] Just two weeks prior to the dismissal, Mr Gathercole sent a text message to Mr Cartarrasa stating how he wished he was local to assist with work in Dream Modular Homes, his other business. It was a compliment. Without any intervening event, Mr Gathercole dismissed Mr Cartarrasa on 2 April 2025.

• [100] There is no sworn evidence that can be tested before the Commission in respect of the reason for the dismissal. I am not satisfied that there was a valid reason for the dismissal.

s.387(b) - Whether the person was notified of that reason

• [101] Mr Cartarrasa was notified on 2 April 2025 of the purported reason for the dismissal. In supplementary material to the Commission, Mr Gathercole has stated that the dismissal was now for another reason.

s.387(c) - Whether there was an opportunity to respond to any reason related to the capacity or conduct of the person

• [102] Mr Cartarrasa was not afforded any opportunity to respond to any reason offered by the Respondent as the reason for the dismissal.

s.387(d) - Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to the dismissal

• [103] Where an employee protected from unfair dismissal has requested a support person be present to assist in discussions relating to the dismissal, an employer should not unreasonably refuse that person being present.

• [104] There is no positive obligation on an employer to offer an employee the opportunity to have a support person. The Explanatory Memorandum, Fair Work Bill 2008 (Cth) at [1542] states the following:

"This factor will only be a relevant consideration when an employee asks to have a support person present in a discussion relating to dismissal and the employer unreasonably refuses. It does not impose a positive obligation on employers to offer an employee the opportunity to have a support person present when they are considering dismissing them."

• [105] Mr Cartarrasa was not unreasonably refused by the Respondent to have a support person present in discussions relating to the dismissal, as there were no discussions. This matter is appropriately considered under s.387(h).

s.387(e) - If the dismissal related to unsatisfactory performance by the person - whether the person had been warned about that unsatisfactory performance before the dismissal.

• [106] The reason given by Mr Gathercole on 2 April 2025 was redundancy.

s.387(f) - Whether the respondent's size impacted on the procedures followed and s.387(g) - Whether the absence of a dedicated human resource management specialist impacted on the procedures followed

• [107] On the information before the Commission, I do consider that the size of the business and the lack of human resource management specialists impacted on the procedures followed by the Respondent in dismissing Mr Cartarrasa.

• [108] The dismissal of Mr Cartarrasa, effected by Mr Gathercole, was curt and cruel. On 1 April 2025, Mr Gathercole committed to speaking with Mr Cartarrasa over video conference on 2 April 2025. He failed to do, instead sending to Mr Cartarrasa notification of termination by email. Mr Gathercole's actions were, in my view, cowardly.

• [109] The jurisdictional objection that the dismissal was a case of genuine redundancy has been determined and dismissed, and consideration has turned to the substantive merits of the application. Having appropriate regard for the various factors contained within s.387 of the Act, I determine that Mr Cartarrasa's dismissal was harsh, unjust and unreasonable.

• [110] Section 390 of the Act reads as follows:

"390 When the FWC may order remedy for unfair dismissal

(1) Subject to subsection (3), the FWC may order a person's reinstatement, or the payment of compensation to a person, if:

(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and

(b) the person has been unfairly dismissed (see Division 3).

(2) The FWC may make the order only if the person has made an application under section 394.

(3) The FWC must not order the payment of compensation to the person unless:

(a) the FWC is satisfied that reinstatement of the person is inappropriate; and

(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.

Note: Division 5 deals with procedural matters such as applications for remedies."

• [111] Mr Cartarrasa is person protected from unfair dismissal for the Act's purposes and is a person who has been unfairly dismissed. Accordingly, I am empowered to exercise discretion as to whether he can be reinstated.

• [112] I am satisfied that it is inappropriate for Mr Cartarrasa to be reinstated with the Respondent. He now suffers from a mental health condition which I am certain would be exacerbated by working under Mr Gathercole.

(1) An order for the payment of compensation to a person must be an order that the person's employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

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

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

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

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

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

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

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

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

(3) If the FWC is satisfied that misconduct of a person contributed to the employer's decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person's dismissal.

(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

(a) the amount worked out under subsection (6); and

(b) half the amount of the high income threshold immediately before the dismissal.

(6) The amount is the total of the following amounts:

(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and

(b) if the employee was on leave without pay or without full pay while so employed during any part of that period - the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations."

• [114] The approach to the calculation of compensation is set out in a decision of a Full Bench of Australian Industrial Relations Commission in Sprigg v Paul's Licensed Festival Supermarket.[7] That approach, with some refinement, has subsequently been endorsed and adopted by Full Benches of the Commission in Bowden v Ottrey Homes Cobram and District Retirement Villages inc T/A Ottrey;[8] Jetstar Airways Pty Ltd v Neetson-Lemkes;[9] and McCulloch v Calvary Health Care.[10]

• [115] I have had regard to the above authorities and have considered the submissions of the parties.

The effect of the order on the viability of the Respondent

• [116] No submissions were made by the Respondent due to its failure to participate in the proceedings.

• [117] Mr Cartarrasa's service in his most recent employment was approximately 16 months. This is not a long period of time.

The remuneration that Mr Cartarrasa would have received, or would have been likely to receive, if he had not been dismissed

• [118] Without any evidence from the Respondent on this issue, this is a difficult matter to assess. I am prepared to accept Mr Cartarrasa's submission that the remuneration would have been up until the date of the hearing on 20 August 2025, that being a period of 20 weeks, and an amount of $27,328. Mr Cartarrasa had not been subject to any disciplinary action and there is simply no evidence before the Commission that can be tested and accepted that the Respondent needed to make his role redundant. In all of the circumstances, I am prepared to find that the employment would have continued until 20 August 2025.

The efforts of Mr Cartarrasa (if any) to mitigate the loss suffered because of the dismissal

• [119] Mr Cartarrasa's workers' compensation claim was accepted and he has been too unwell to source other employment.

The amount of any remuneration earned by Mr Cartarrasa from employment or other work during the period between the dismissal and the making of the order for compensation

The amount of any income reasonably likely to be so earned by Mr Brown during the period between the making of the order for compensation and the actual compensation

• [121] This is not a relevant consideration.

• [122] It is acknowledged that in the 20-week period between being dismissed and the hearing, Mr Cartarrasa was in receipt of $14,640.02 in workers' compensation. It is necessary to deduct this amount.[11]

• [123] Section 392(3) of the Act requires that if the Commission is satisfied that the misconduct of a person contributed to the employer's decision to dismiss the person, then the Commission must reduce the amount it would otherwise order by an appropriate amount on account of the misconduct.

• [124] The section requires that consideration be given by the Commission, amongst other things, as to whether a person's misconduct contributed to the decision to dismiss an employee even if the Commission has found that there was no valid reason for the person's dismissal. However, if there was no valid reason for the dismissal, that may be relevant to the Commission's decision as to the appropriate amount by which the amount of compensation should be reduced.

• [125] Mr Cartarrasa did not engage in misconduct.

• [126] I confirm that any amount ordered does not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt caused to Mr Cartarrasa by the manner of the dismissal.

• [127] I must reduce the amount of compensation to be ordered if it exceeds the lesser of the total amount of remuneration received by the applicant, or to which the applicant was entitled, for any period of employment with the employer during the 26 weeks immediately before the dismissal, or the high income threshold immediately prior to the dismissal.

• [128] The amount ordered does not exceed these amounts.

• [129] The Respondent has failed to participate in this matter such that there are no submissions before the Commission in respect of this consideration. If, following this decision being published and the order for compensation being made, the Respondent wishes to provide evidence and make submissions in respect of the Commission ordering the payment by instalments, I will give due consideration to amending the order.

• [130] I have determined that Mr Cartarrasa would have earned remuneration in the amount of $27,328 in wages. It is necessary to deduct the workers' compensation payment of $14,640.02 Mr Cartarrasa has received. The calculation is therefore $12,687.98.

• [131] Mr Cartarrasa would have earned approximately 13 weeks of wages between the dismissal and 30 June 2025, and approximately 7 weeks from 1 July 2025 to 20 August 2025.

• [132] The superannuation rate up until 30 June 2025 was 11.5%. From 1 July 2025 it increased to 12%. The superannuation he would have been entitled to for that period is:

• [133] In Queensland, WorkCover does not make payment to an injured or ill employee's superannuation account. Accordingly, Mr Cartarrasa will be awarded the full amount of $3,190.55 in superannuation.

• [134] The Respondent is to pay to Mr Cartarrasa the amount of $12,687.98 taxed as required by law within 21 days.

• [135] The Respondent is to pay into Mr Cartarrasa's superannuation account the amount of $3,190.55 within 90 days.

• [136] An order [PR793435] giving effect to this decision will be published

R Diqer of Counsel, instructed by J Wray of Legal Aid Queensland, for the Applicant.

[1] Fair Work Act 2009 (Cth) s.23(3).

[2] See ibid s.677(1).

[3] Citing Melisa Morgan v Heritage Motels and Restaurants [2016] FWC 4842; Varani v Independent Advocacy in the Tropics Incorporated T/A Independent Advocacy Townsville [2011] FWA 1633.

[5] Sayer v Melsteel [2011] FWAFB 7498 at [20].

[6] Walton v Mermaid Dry Cleaners Pty Ltd [1996] IRCA 267; (1996) 142 ALR 681, 685.

[7] [1998] AIRC 989; (1998) 88 IR 21.

[8] [2013] FWCFB 431.

[9] [2013] FWCFB 9075.

[10] [2015] FWCFB 2267.

[11] Sprigg v Paul's Licensed Festival Supermarket Print R0235 (AIRCFB, Munro J, Duncan DP, Jones C, 24 December 1998) at para. 26, [(1998) 88 IR 21].

Printed by authority of the Commonwealth Government Printer